EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*sb0161*
SENATE BILL 161
D3 2lr0771
SB 189/21 – JPR (PRE–FILED) CF HB 79
By: Senator West
Requested: October 15, 2021
Introduced and read first time: January 12, 2022
Assigned to: Judicial Proceedings
Committee Report: Favorable with amendments
Senate action: Adopted
Read second time: February 17, 2022
CHAPTER ______
AN ACT concerning 1
Courts – Prohibited Indemnity and Defense Liability Agreements 2
FOR the purpose of prohibiting a provision in a contract with a design professional for 3
professional services that requires the design professional to indemnify or hold 4
harmless certain parties unless the design professional is at fault for causing the 5
loss, damage, or expense indemnified; prohibiting a provision in a contract with a 6
design professional for professional services that requires the design professional to 7
defend certain parties against liability or certain claims; and generally relating to 8
indemnity and defense liability agreements. 9
BY repealing and reenacting, with amendments, 10
Article – Courts and Judicial Proceedings 11
Section 5–401(a) 12
Annotated Code of Maryland 13
(2020 Replacement Volume and 2021 Supplement) 14
SECTION 1. BE IT ENACTED BY THE GENER AL ASSEMBLY OF MARYLAND, 15
That the Laws of Maryland read as follows: 16
Article – Courts and Judicial Proceedings 17
5–401. 18
2 SENATE BILL 161
(a) (1) (I) IN THIS SUBSECTION TH E FOLLOWING WORDS HA VE THE 1
MEANINGS INDICATED . 2
(II) “DEFEND” MEANS TO PAY FOR DEF ENSE COSTS OR TO 3
FURNISH COUNSEL AT T HE EXPENSE OF THE PR OMISOR FOR THE PURPO SE OF 4
DEFENDING A PROMISEE OR THE PROMISEE ’S INDEPENDENT CONTRA CTORS, 5
AGENTS, EMPLOYEES, OR INDEMNITEES AGAIN ST CLAIMS ALLEGED OR BROUGHT 6
AGAINST THE PROMISEE OR THE PROMISEE ’S INDEPENDENT CONTRA CTORS, 7
AGENTS, EMPLOYEES, OR INDEMNITEES BY A THIRD PARTY IN ANY C OURT OR OTHER 8
TRIBUNAL, INCLUDING FORMS OF A LTERNATIVE DISPUTE R ESOLUTION REQUIRED 9
BY LAW OR CONTRACT , BEFORE THE COURT OR TRIBUNAL HAS REACHED A FINAL 10
DETERMINATION OF FAU LT. 11
(III) “DEFENSE COSTS ” MEANS REASONABLE FEE S OF 12
ATTORNEYS AND EXPERT WITNESSES, COURT COSTS , AND RELATED EXPENSES 13
ACTUALLY INCURRED BY A PARTY IN THE DEFEN SE OF A CLAIM OR AN ALLEGATION 14
OF LIABILITY IN CONN ECTION WITH LITIGATI ON, ARBITRATION, OR ALTERNATIVE 15
DISPUTE RESOLUTION PROCEEDIN GS. 16
(IV) “DERIVATIVE PARTIES ” MEANS A PARTY ’S 17
SUBCONTRACTORS , AGENTS, EMPLOYEES, OR OTHER PERSONS FOR WHICH THE 18
PARTY MAY BE LIABLE OR RESPONSIBLE AS A RESULT OF ANY STATUT ORY, TORT, OR 19
CONTRACTUAL DUTY . 20
(V) “DESIGN PROFESSION AL” MEANS: 21
1. A LICENSED ARCHITECT , AS DEFINED IN § 3–101 OF 22
THE BUSINESS OCCUPATIONS AND PROFESSIONS ARTICLE; 23
2. A CERTIFIED INTERIOR D ESIGNER, AS DEFINED IN § 24
8–101 OF THE BUSINESS OCCUPATIONS AND PROFESSIONS ARTICLE; 25
3. A LICENSED LANDS CAPE ARCHITECT , AS DEFINED IN 26
§ 9–101 OF THE BUSINESS OCCUPATIONS AND PROFESSIONS ARTICLE; 27
4. A PROFESSIONAL ENGINEE R, AS DEFINED IN § 14–101 28
OF THE BUSINESS OCCUPATIONS AND PROFESSIONS ARTICLE; OR 29
5. A PROFESSIONAL LAND SU RVEYOR, AS DEFINED IN § 30
15–101 OF THE BUSINESS OCCUPATIONS AND PROFESSIONS ARTICLE. 31
(VI) “FAULT” MEANS: 32
1. A BREACH OF CONTRACT ; 33 SENATE BILL 161 3
2. A NEGLIGENT, RECKLESS, OR INTENTIONAL ACT O R 1
OMISSION CONSTITUTIN G A TORT; OR 2
3. A VIOLATION OF APPLICA BLE STATUTES OR 3
REGULATIONS. 4
(VII) “PROFESSIONAL SERVICES ” MEANS SERVICES OR WO RK 5
THAT CONSTITUTES THE PRACTICE OF A PROFES SION REGULATED BY , OR FOR 6
WHICH LICENSURE IS R EQUIRED UNDER , TITLE 3, TITLE 8, TITLE 9, TITLE 14, OR 7
TITLE 15 OF THE BUSINESS OCCUPATIONS AND PROFESSIONS ARTICLE. 8
(2) A PROVISION, covenant, promise, agreement, or understanding in, or 9
in connection with or collateral to, a contract or agreement relating to architectural, 10
engineering, inspecting, or surveying services, or the construction, alteration, repair, or 11
maintenance of a building, structure, HIGHWAY, ROAD, appurtenance or appliance, 12
including moving, demolition, and excavating connected with those services or that work, 13
purporting to indemnify the promisee against liability for damages arising out of bodily 14
injury to any person or damage to property caused by or resulting from the sole negligence 15
of the promisee or indemnitee, or the agents or employees of the promisee or indemnitee, is 16
against public policy and is void and unenforceable. 17
[(2)] (3) A PROVISION, A covenant, a promise, an agreement, or an 18
understanding in, or in connection with or collateral to, a contract or an agreement relating 19
to architectural, engineering, inspecting, or surveying services, or the construction, 20
alteration, repair, or maintenance of a building, a structure, A HIGHWAY, A ROAD, an 21
appurtenance, or an appliance, including moving, demolition, and excavating connected 22
with those services or that work, purporting to require the promisor or indemnitor to defend 23
or pay the costs of defending the promisee or indemnitee against liability for damages 24
arising out of bodily injury to any person or damage to property caused by or resulting from 25
the sole negligence of the promisee or indemnitee, or the agents or employees of the 26
promisee or indemnitee, is against public policy and is void and unenforceable. 27
(4) A PROVISION IN, OR IN CONNECTION WIT H A CONTRACT OR AN 28
AGREEMENT WITH A DES IGN PROFESSIONAL FOR PROFESSIONAL SERVICE S 29
PURPORTING TO REQUIR E THE DESIGN PROFESS IONAL TO INDEMN IFY OR HOLD 30
HARMLESS THE PROMISE E, THE PROMISEE ’S INDEPENDENT CONTRA CTORS, 31
AGENTS, EMPLOYEES, OR INDEMNITEES , OR ANY OTHER PERSON AGAINST LOSS, 32
DAMAGES, OR EXPENSES IS VOID AND UNENFORCEABLE UN LESS THE FAULT OF TH E 33
DESIGN PROFESSIONAL OR ITS DERIVATIVE PA RTIES IS THE A PROXIMATE CAUSE OF 34
THE LOSS, DAMAGE, OR EXPENSE INDEMNIFI ED. 35
(5) A PROVISION IN, OR IN CONNECTION WIT H A CONTRACT OR AN 36
AGREEMENT WITH A DES IGN PROFESSIONAL FOR PROFESSIONAL SERVICE S 37
PURPORTING TO REQUIR E THE DESIGN PROFESS IONAL TO DEFEND A PROMISEE, 38 4 SENATE BILL 161
THE PROMISEE ’S INDEPENDENT CONTRA CTORS, AGENTS, EMPLOYEES, OR 1
INDEMNITIEES, OR ANY OTHER PERSON AGAINST LIABILITY OR CLAIMS FOR 2
DAMAGES OR EXPENSES , INCLUDING ATTORNEY ’S FEES, ALLEGED TO BE CAUSED , IN 3
WHOLE OR IN PART , BY THE PROFESSIONAL NEGLIGENCE OF THE DESIGN 4
PROFESSIONAL OR ITS DERIVATIVE PARTIES , WHETHER THE CLAIM IS ALLEGED OR 5
BROUGHT IN TORT OR C ONTRACT, IS AGAINST PUBLIC PO LICY AND IS VOID AND 6
UNENFORCEABLE . 7
(6) THIS SUBSECTION MAY N OT BE INTERPRETED TO PROHIBIT AN 8
OTHERWISE ENFORC EABLE INDEMNITY OR H OLD HARMLESS PROVISI ON IN ANY 9
CONTRACT OR AGREEMEN T FROM INCLUDING REC OVERY OF REASONABLE 10
ATTORNEY’S FEES AND DEFENSE C OSTS ACTUALLY INCURR ED BY THE PROMISEE T O 11
DEFEND AGAINST THIRD –PARTY CLAIMS FOR DAM AGES, LOSSES, OR EXPENSES , 12
ALLEGED IN ANY COURT , TRIBUNAL, OR ALTERNATIVE DISPU TE RESOLUTION 13
PROCEDURE REQUIRED O F THE PROMISEE BY LA W OR BY CONTRACT , IN CASES 14
WHERE THE FAULT OF T HE PROMISOR OR ITS D ERIVATIVE PARTIES IS DETERMINED 15
TO BE THE PROXIMATE CAUSE OF THE DEFENSE COSTS TO BE INDEMNIF IED. 16
[(3)] (7) (6) This subsection does not affect the validity of any insurance 17
contract, workers’ compensation, any general indemnity agreement required by a surety as 18
a condition of execution of a bond for a construction or other contract, or any other 19
agreement issued by an insurer. 20
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 21
October 1, 2022. 22
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
President of the Senate.
________________________________________________________________________________
Speaker of the House of Delegates.