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4-56-104. Hold Harmless Clause In Construction Contracts Unenforceable -- Definitions.

(a) As used in this section:

(1) "Construction" means any of the following services, functions, or combination of the following services or functions to construct a building, building site, or structure, to construct a permanent improvement to a building, building site, or structure, including sitework:

(A) Alteration;

(B) Design;

(C) Erection;

(D) Reconditioning;

(E) Renovation;

(F) Repair; or

(G) Replacement;

(2)

(A) "Construction agreement" means the bargain of the parties in fact, as found in the language of the parties or inferred from other circumstances, including course of performance, course of dealing, or usage of trade as provided in § 4-1-303.

(B) "Construction agreement" does not include an insurance contract, a construction bond, or a contract to defend a party against liability;

(3)

(A) "Construction contract" means the total legal obligation that results from the parties' agreement as supplemented by any other applicable law.

(B) "Construction contract" does not include an insurance contract, a construction bond, or a contract to defend a party against liability;

(4) "Gas" means natural gas, including casing-head gas and all other hydrocarbons that are not oil under subdivision (a)(5) of this section;

(5) "Oil" means crude petroleum oil and other hydrocarbons regardless of gravity that are produced at the well in liquid form by ordinary production methods and is not the result of condensation of gas after it leaves the reservoir; and

(6) "Operator" means a person that has the right as a landowner or by agreement with a landowner to enter on the land of another to explore, drill, and develop for the production of brine, oil, gas, and any other petroleum hydrocarbons.

(b) A provision in a construction agreement or construction contract is void and unenforceable as against public policy if it requires an entity or that entity's insurer to indemnify, defend, or hold harmless another entity against liability for damage arising out of the death of or bodily injury to a person or persons or damage to property, which arises out of the negligence or fault of the indemnitee, its agents, representatives, subcontractors, or suppliers.

(c) A provision, covenant, clause, or understanding written in a construction agreement or construction contract that conflicts with the provisions and intent of this section or attempts to circumvent this section by making the construction agreement or construction contract subject to the laws of another state, or that requires any litigation, arbitration, or other alternative dispute resolution proceeding arising from the construction agreement or construction contract to be conducted in another state, is void and unenforceable.

(d) A clause described under subsections (b) and (c) of this section is severable from the construction agreement or construction contract and shall not cause the entire construction agreement or construction contract to become unenforceable.

(e) The provisions of this section do not affect any provision in a construction agreement or construction contract:

(1) That requires an entity or that entity's insurer to indemnify another entity against liability for damage arising out of the death of or bodily injury to persons, or damage to property, but the indemnification shall not exceed any amounts that are greater than that represented by the degree or percentage of negligence or fault attributable to the indemnitors, its agents, representatives, subcontractors, or suppliers; or

(2) To provide construction work or services to an operator or other person directly related to activities or operations stemming from the exploration, drilling, production, processing, gathering, or movement of oil or gas, including without limitation the planning, construction, site preparation, or installation of equipment, facilities, or structures, on or off at least one (1) site where any exploration or production operations have occurred, are occurring, or will occur.

History

Acts 2007, No. 874, § 2; 2009, No. 540, § 2; 2011, No. 719, § 1; 2015, No. 1110, §§ 1-4; 2015, No. 1120, §§ 1-4.

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Local Government
Arkansas
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Asa Hutchinson
Asa Hutchinson
January 13, 2015 -
Republican
501-682-5080
425 W Capitol Ave. Suite 1620, Little Rock, AR, 72201

Keywords
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agreement
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result
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unenforceable
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gas
production