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SR-100-002 (11) EPWM:CC:AA:DP: F:\DATA\SPFILES\SP-MISC\cc Reports\ccAB1839.doc City Council Meeting: August 13, 2002 Santa Monica, California TO: Mayor and City Council FROM: City Staff SUBJECT: Resolution In Opposition To Assembly Bill 1839 Introduction This report recommends adopting the attached resolution in opposition to Assembly Bill 1839 which seeks to place limits on the contractual indemnity provisions of public works design contracts. Discussion AB 1839 seeks to limit the indemnity provisions of design contracts. Under its terms, cities would be held harmless only against those liabilities, claims, actions, demands, losses, and costs to those actions caused by willful misconduct, negligence, or recklessness of the design consultant in performance of the work specified in the contract. AB 1839 supercedes current law which allows cities the flexibility to require indemnification clauses that include other provisions, such as design flaws, errors or omissions, or non-performance, the activities of the design consultant or its sub consultants, and injury, property damage, or other losses to a third party as the result of the design consultant actions. 1 Should AB 1839 pass, the City will lose many of the existing protections against design consultant actions. Budget/Financial Impact There are no budget or financial impacts as a result of adopting the attached resolution. Recommendations Staff recommends that the Council adopt the attached resolution in opposition of Assembly Bill 1839. Prepared by: Craig Perkins, Director of Environmental and Public Works Management Anthony Antich, P.E., City Engineer Donald Patterson, Senior Administrative Analyst Attachments: Resolution 2 EPWM:CC:AA:DP: F:\DATA\SPFILES\SP-MISC\cc Reports\ccProp35.doc City Council Meeting: August 13, 2002 Santa Monica, California RESOLUTION NUMBER (CCS) CITY COUNCIL SERIES A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA IN OPPOSITION TO ASSEMBLY BILL 1839 - AMENDMENT TO THE CIVIL CODE WHEREAS, the City of Santa Monica currently has the authority and duty to respond to local concerns and to provide rules that best meet the needs of the community; and WHEREAS, the City of Santa Monica currently negotiates indemnification agreements with its design professionals and design/builders in a manner that protects the City from liability for claims arising from the performance or nonperformance of the agreement, design activities, payments to its subconsultants, personal injuries associated with the performance or nonperformance of its activities, among others; WHEREAS, Assembly Bill 1839 will limit the obligations of design professionals to indemnify public agencies only to the extent claims are caused by the negligence, recklessness or wilful misconduct of the design professionals in the performance of the agreement; 3 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES RESOLVE AS FOLLOWS: SECTION 1. The City of Santa of Santa Monica opposes Assembly Bill 1839, which will limit the conditions by which the City can require design professionals to indemnify the City. SECTION 2. The City Clerk shall certify to the adoption of the resolution, and thenceforth and thereafter the same shall be in full force and effect. APPROVED AS TO FORM: __________________________ MARSHA JONES MOUTRIE City Attorney 4