Relates to the unenforceability of a contract clause requiring a contractor or subcontractor to continue unapproved or disputed work.

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S6057-2011 Actions

• Jun 18, 2012: referred to judiciary
• Jun 18, 2012: DELIVERED TO ASSEMBLY
• Jun 18, 2012: PASSED SENATE
• May 7, 2012: ADVANCED TO THIRD READING
• May 2, 2012: 2ND REPORT CAL.
• May 1, 2012: 1ST REPORT CAL.625
• Jan 4, 2012: REFERRED TO JUDICIARY

S6057-2011 Meetings

Judiciary: Apr 26, 2012, Judiciary: May 1, 2012

S6057-2011 Calendars

Active List: Jun 18, 2012 , Floor Calendar: May 2, 2012 , Floor Calendar: May 7, 2012 , Floor Calendar: May 8, 2012 , Floor Calendar: May 9, 2012 , Floor Calendar: May 14, 2012 , Floor Calendar: May 15, 2012 , Floor Calendar: May 16, 2012 , Floor Calendar: May 21, 2012 , Floor Calendar: May 22, 2012 , Floor Calendar: May 23, 2012 , Floor Calendar: May 30, 2012 , Floor Calendar: May 31, 2012 , Floor Calendar: Jun 4, 2012 , Floor Calendar: Jun 5, 2012 , Floor Calendar: Jun 6, 2012 , Floor Calendar: Jun 11, 2012 , Floor Calendar: Jun 12, 2012 , Floor Calendar: Jun 13, 2012 , Floor Calendar: Jun 14, 2012 , Floor Calendar: Jun 18, 2012

S6057-2011 Votes

S6057-2011 Memo

BILL NUMBER:S6057

TITLE OF BILL:
An act
to amend the general obligations law, in relation to the
unenforceability of a contract clause requiring a contractor or
subcontractor to continue unapproved or disputed work

PURPOSE OR GENERAL IDEA OF BILL:
To forbid agreements in construction
contracts which require contractors or subcontractors to commence or
continue unapproved or disputed work.

SUMMARY OF SPECIFIC PROVISIONS:
Section 5-322.1 of the General
Obligations Law is amended to declare void and unenforceable
construction contract provisions which require contractors or
subcontractors to commence or continue unapproved or disputed work.

JUSTIFICATION:
Contract clauses which require subcontractors to
commence or continue work on a project notwithstanding that the work
is in dispute or not yet approved by the owner puts the subcontractor
at risk of not being paid for the work he or she completes. These
clauses are found in many construction contracts and are the cause of
unnecessary and costly litigation and arbitration. This bill
endeavors to cure this problem by making such clauses void and
unenforceable. Contractors and subcontractors who refuse to commence
or continue , unapproved or disputed work will no longer be liable
for delay damages due to their refusal.
The bill will also provide an incentive for owners to settle disputes
and process change orders.

PRIOR LEGISLATIVE HISTORY:
New bill.

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
This act shall take effect immediately and shall apply
to all contracts executed on and after the effective date.

S6057-2011 Text

                      S T A T E   O F   N E W   Y O R K
  ________________________________________________________________________

      S. 6057                                                  A. 8841

                        SENATE - ASSEMBLY

                                 (PREFILED)

                               January 4, 2012
                                 ___________

  IN  SENATE  --  Introduced by Sen. DeFRANCISCO -- read twice and ordered
    printed, and when printed to be committed to the Committee on  Judici-
    ary

  IN  ASSEMBLY -- Introduced by M. of A. CUSICK, P. RIVERA, RUSSELL, STEV-
    ENSON, CASTRO -- Multi-Sponsored by -- M. of A. SCHIMEL --  read  once
    and referred to the Committee on Judiciary

  AN  ACT  to  amend the general obligations law, in relation to the unen-
    forceability of a contract clause requiring a  contractor  or  subcon-
    tractor to continue unapproved or disputed work

    THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
  BLY, DO ENACT AS FOLLOWS:


    Section 1. Subdivision 2 of section 5-322.1 of the general obligations
  law, as added by chapter 224 of the laws of 2009, is amended to read  as
  follows:

    2.   A  covenant,  promise,  agreement  or  understanding  in,  or  in
  connection with or collateral to a contract or agreement relative to the
  construction, alteration, repair or maintenance of  a  building,  struc-
  ture,  appurtenances  and  appliances  including  moving, demolition and
  excavating connected therewith, (A) purporting to  condition  a  subcon-
  tractor's  or  materialman's  right  to  file a claim and/or commence an
  action on a payment bond on exhaustion of another legal  remedy  OR  (B)
  WHICH  REQUIRES  A  CONTRACTOR  OR SUBCONTRACTOR TO COMMENCE OR CONTINUE
  WORK NOTWITHSTANDING THAT THE WORK AND/OR THE PRICE FOR THE WORK  IS  IN
  DISPUTE  OR  HAS NOT BEEN APPROVED BY THE OWNER is against public policy
  and is void and unenforceable; provided that this subdivision shall  not
  affect  the  validity  of  any insurance contract, workers' compensation
  agreement or other agreement issued by an admitted insurer.
    S 2.  This act shall take effect immediately.


   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD13599-01-1