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Recently enacted California statute clarifies design professionals' duty to defend obligations.

April 1, 2011

On January 1, 2011, California SD 972 became effective. The law reduces a design professional's liability when entering into contracts with public agencies. Under the previous law, construction design professionals were under a "duty to defend" public agencies regardless of whether the design professional was negligent or had breached a contract. The new statute was enacted in response to two court decisions (Crawford v. Weather Shield Mfg., Inc. 44 Cal.4th 541 (2007) and UDC v. CH2M Hill 181 Cal.App.4th 10 (2007)) which held that parties could be required to bear defense costs under common contractual indemnity provisions, even if the professionals were not found to have been negligent. SD 972 states that a design professional's "duty to defend" will only be triggered for claims that arise out of, or are related to, the professional's negligence. The design professional's duty to defend will only arise after the design professional is found to be negligent. SD 972 eases the burden on construction design professionals in contract with public agencies. With the passage of this law design professionals in California should have an easier time in obtaining insurance coverage and will be more likely to bid on projects involving public works.

Case Law Alert - 2nd Qtr 2011

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David J. Shannon
Chair, Privacy and Data Security
(215) 575-2615

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