05 LC 14
9028/AP
House
Bill 307 (AS PASSED HOUSE AND SENATE)
By:
Representatives Rogers of the
26th
and Ralston of the
7th
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Code Section 8-2-40 of the Official Code of Georgia Annotated, relating to
the effect of a
claimant́s
acceptance of a settlement in relation to a construction defect claim, so as to
provide that a
contractoŕs
fulfillment of an offer for settlement or repair does not create insurance
coverage or affect the
partieś
rights under a
contractoŕs
liability policy; to provide for related matters; to repeal conflicting laws;
and for other purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Code
Section 8-2-40 of the Official Code of Georgia Annotated, relating to the effect
of a
claimant́s
acceptance of a settlement in relation to a construction defect claim, is
amended by striking said Code section in its entirety and inserting in lieu
thereof the following:
"8-2-40.
(a)
If a claimant accepts an offer made in compliance with this part and the
contractor fulfills the offer in compliance with this part:
(1)
The claimant shall thereafter be barred from bringing an action for the claim
described in the notice of claim; and
(2)
The
contractor shall be deemed, for insurance purposes, to have been legally
obligated to make the repairs or the monetary payment as if the claimant had
recovered a judgment against the contractor in the amount of the cost of the
repairs or the amount of the monetary payment or
both.
A
contractoŕs
performance of repairs or payment of money to a claimant made pursuant to this
Code section shall not, by itself, create insurance coverage or otherwise affect
the mutual rights and obligations of the parties under a
contractoŕs
liability insurance policy or, by itself, be considered a voluntary payment of
an otherwise valid insured loss.
(b)
An insurer paying a claim under this part shall be subrogated to the rights of
the claimant to whom the amounts were paid against the person causing the
construction defect, damages, or other reason for payment to the extent that
claim payments were made, except that the insurer shall be required to pay any
applicable part of costs, expenses, and
attorneýs
fees incurred in connection
therewith."
SECTION
2.
All
laws and parts of laws in conflict with this Act are repealed.