The AIACC-sponsored legislation to provide some relief to the “duty-to-defend” obligation design professionals face was dropped before its first hearing in response to very strong and united opposition from public agencies and after we learned that the State Senator who chairs the Senate Judiciary Committee, where it was referred for its hearing, was inclined to vote against our bill. Without the Chair’s support, our bill would have failed in Committee.
The bill, SB 1276, would have affected only contracts for public works and would have required any obligation to defend to be expressly stated in the contract. Currently, this uninsurable risk is included with any contractual obligation to indemnify unless expressly excluded.
Even though this bill would not have prevented an obligation to defend — it would have only required that obligation to be clearly and expressly stated in the contract — public agencies lined up in opposition. Those agencies included the League of California Cities, California State Association of Counties, Los Angeles Unified School District, California State University system, Regional Council of Rural Counties, Association of California Healthcare Districts, Coalition for Adequate School Housing, California Special Districts Association, and many other public associations and agencies.
The opposition coalition argued SB 1276 “eliminates a public agency’s right to invoke defense obligations from consultants … who design … our infrastructure projects” and allows design professionals to “shift up-front defense costs to the public agency, even in situations where the design professional is 100% responsible.”
Our lobbyists and attorneys Gilson Riecken, AIA, Esq. (Morris Polich & Purdy) and Steve Sharafian, Esq. (Long & Levit) met with many representatives from the opposition a few weeks ago to talk about the threat that the duty-to-defend obligation presents to design professionals, chiefly that it is an uninsurable risk to design professionals absent a finding of negligence. Unfortunately, that meeting produced no results that would remove their opposition.
The Chair of the Senate Judiciary Committee, State Senator Noreen Evans, acknowledged there is a problem that deserves attention, but she believed our SB 1276 was not the solution. Last Friday, she met with some of her constituent architects from the AIA Redwood Empire in her Santa Rosa office. Her constituent architects explained that the problem is real and is a great threat to the health of the profession in California. Senator Evans agrees the problem needs to be looked at and agreed to work with her constituent architects, the AIACC, and all interested parties to try to find a solution that does not expose architects to an uninsurable risk.
The AIACC will work with Senator Evans and the author of SB 1276, Senator Mark Wyland, this summer and fall in our ongoing effort to resolve the uninsurable risk the profession faces with the duty-to-defend obligation.