Unenforceable provisions in public construction agreements and public construction contracts — Definitions

1. Law
2. Arkansas Code
3. Public Property
4. Public Works
5. Award of Contracts
6. Unenforceable provisions in public construction agreements and public construction contracts — Definitions

1. (a) As used in this section:

   1. (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, or to construct a permanent improvement to a building, building site, or structure, including site work:

      1. (A) Alteration;

      2. (B) Design;

      3. (C) Erection;

      4. (D) Reconditioning;

      5. (E) Renovation;

      6. (F) Repair; or

      7. (G) Replacement;

   2. (2)

      1. (A) “Public construction agreement” means an agreement in which one (1) party is a public entity and the agreement is the bargain of the parties in fact as found in their language or inferred from other circumstances, including course of performance, course of dealing, or usage of trade as provided in § 4-1-303.

      2. (B) “Public construction agreement” does not include an insurance contract, a construction bond, or a contract to defend a party against liability; and

   3. (3)

      1. (A) “Public construction contract” means a contract in which one (1) party is a public entity and the contract is the total legal obligation that results from the parties' agreement under this section and as supplemented by any other applicable law.

      2. (B) “Public construction contract” does not include an insurance contract, a construction bond, or a contract to defend a party against liability.

2. (b) A provision in a public construction agreement or public construction contract is void and unenforceable as against public policy if it requires an entity or that entity's insurer to indemnify, insure, 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 negligence or fault of the indemnitee, its agents, representatives, subcontractors, or suppliers.

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

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

5. (e) The provisions of this section do not affect any provision in a public construction contract or public construction agreement 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 such 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.

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