Effective April 26, 2016, Georgia amended its anti-indemnification statute, Ga. Code § 13-8-2, to cover not only construction contracts, but also contracts for engineering, architectural or land surveying services. The amended statute, however, does not apply equally to construction and professional services contracts.
In Sanislo v. Give Kids the World, Inc., 157 So.3d 256 (Fla. 2015), the Supreme Court of Florida considered whether a party to a contract, in order to be released from liability for its own negligence, needs to include an express reference to negligence in an exculpatory clause. The court held that, unlike an indemnification clause, so long as the language in an exculpatory clause is clear, the absence of the terms “negligence” or “negligent acts” in an exculpatory clause does not, for that reason alone, render the exculpatory clause ineffective.
In Atlanta Flooring Design Centers, Inc. v. R.G. Williams Construction, Inc., — S.E.2d –, 2015 WL 4311070 (Ga. App. July 16, 2015), the Georgia Court of Appeals addressed the validity of a contract clause in a construction contract. In the contract, R.G. Williams Construction, Inc. (“Williams”), the general contractor, and Atlanta Flooring Design Centers, Inc. (“AFDC”) agreed to arbitrate any disputes related to the contract. In addition, Williams and AFDC expressly agreed “not to challenge the validity of the arbitration or the award.” The court, relying in part on analogous federal arbitration law, held that the clause – precluding judicial review of an arbitration award – altered Georgia’s statutory arbitration scheme, frustrated Georgia’s public policy and was void and unenforceable.
In Belasco v. Wells, 183 Cal. Rptr.3d 840, 234 Cal. App. 4th 409 (2015), the California Court of Appeals for the Second District addressed the question of whether a homeowner, when settling an administrative complaint against a licensed homebuilder, can release future, unknown claims. Despite the presence of a California statute, Cal. Civ. Code § 1542, stating that a general release does not extend to claims that the releasor does not know about, the court held that the homeowner’s express release of future claims was enforceable. Thus, the homeowner’s release – signed as part of a 2006 settlement of the homeowner’s construction defect claims against the defendant, a homebuilder – barred the homeowner’s 2012 claims against the builder based on latent defects in the roof of the home that the homeowner discovered in 2011.