• 

  News and Publications

  • Media Room
  • News: Federal
  • News: State
  • Publications
  • Subscriptions

• 

  Seminars and Services

  • Convention
  • Event Calendar
  • Services

• 

  Government Affairs

  • Advocacy
  • Compliance
  • Issue Resources
  • Legislative Reports
  • Public Policy
  • Political Action

• 

  About NAMIC

  • Membership
  • History
  • Member Directory
  • Employment
  • Affiliates
  • Contact

Read	E-mail Print

Colorado: Pro Rata Liability Provision in Construction Agreements to Governor

A bill requiring the tortfeasor to be responsible for his own wrong-doing passed the Senate 21-13 on May 5. It passed the House on 3rd reading May 4, 43-21. Similar bills were offered in past legislative sessions, but killed by opponents of this type of tort reform measure. NAMIC will request that Gov. Owens sign SB 142.

SB 142 would require the tortfeasor (person committing the negligence) to be responsible for his/her own wrong-doing. SB 142 would not affect any provision in a construction contract that requires a person or the person's surety or insurer to indemnify another against liability for damages, including attorney's fees and costs, arising out of that party's negligence. However, the party's duty to indemnify and defend would be limited to that person's degree or percentage of negligence or fault. The at-fault party's obligation to indemnify or defend another party is limited to that person's pro rata responsibility for the damages.

"The purpose of SB 142 is to insure that legal liability for damages arising out of negligence in the construction arena is allocated to the appropriate party in proportion to that party's fault, just like it is presently done in the area of automobile accidents," stated State Affairs Manager Christian J. Rataj. SB 142 promotes the ideals of the current law on comparative negligence and pro rate liability."

NAMIC, members of the insurance industry, and members of the sub-contractor industry worked in concert to educate legislators about how SB 142 is necessary to make tort liability law in the construction industry consistent with the Pro Rata Liability Statute in Colorado, CRS § 13-21-111.5, which states:

In an action brought as a result of a death or an injury to person or property, no defendant shall be liable for an amount greater than that represented by the degree or percentage of the negligence or fault attributable to such defendant that produced the claimed injury, death, damage, or loss, except as provided in subsection (4) of this section. [Emphasis added].

NAMIC actively supports SB 142, because it is:

• a reasonable and appropriate tort reform measure because it promotes Colorado's "Pro Rata Liability Doctrine;"
• good for the construction industry because it encourages "professional responsibility" and the implementation of sound risk management practices; and
• good for the consumer because it will facilitate market competition between sub-contractors. Under the current system, many small business sub-contractors have been forced out of business as a result of the economic burden associated with being contractually required to indemnify and defend general contractors and developers for liability that exceeds the actual tort liability of the sub-contractor.

"SB 142 promotes legal consistency throughout the Colorado tort law system by enforcing the sound public policy principle that a person should be legally liable for no more or less than his portion of the damages caused by his pro rata share of the negligence," stated Rataj.

Direct questions to State Affairs Manager Christian Rataj.