Bill Text: OR SB893 | 2011 | Regular Session | Introduced

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Bill Title: Relating to construction contracts.

Sponsorship: Committee Bill

Status: (Failed) 2011-06-30 - In committee upon adjournment. [SB893 Detail]

Download: Oregon-2011-SB893-Introduced.html

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     76th OREGON LEGISLATIVE ASSEMBLY--2011 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 3795

                         Senate Bill 893

Sponsored by COMMITTEE ON GENERAL GOVERNMENT, CONSUMER AND SMALL
  BUSINESS PROTECTION

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.

  Prohibits construction contractor from performing work to
construct, improve or repair large commercial structure, small
commercial structure, residential structure or zero-lot-line
dwelling for property owner unless contractor provides property
owner with written statement that contractor has contractual
obligation to ensure that work performed meets state building
code requirements. Requires contractor to obtain written
statement from subcontractors that subcontractor has contractual
obligation to ensure all work performed by subcontractor will
meet state building code requirements. Makes property owner
beneficiary of obligation stated by subcontractor.
  Makes violations subject to civil penalty, not to exceed
$5,000.

                        A BILL FOR AN ACT
Relating to construction contracts; creating new provisions; and
  amending ORS 701.305.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + Section 2 of this 2011 Act is added to and made
a part of ORS chapter 701. + }
  SECTION 2.  { + (1) A contractor may not perform work to
construct, improve or repair a large commercial structure, small
commercial structure, residential structure or zero-lot-line
dwelling for a property owner unless the contractor provides the
property owner with a written statement that the contractor has a
contractual obligation to the property owner to:
  (a) Ensure that all work performed by the contractor or any
subcontractor of the contractor meets state building code
requirements; and
  (b) Obtain from any subcontractor, and provide to the property
owner, a written statement that the subcontractor has a
contractual obligation to ensure that all work performed by the
subcontractor meets state building code requirements.
  (2) If the price for the performance of work to construct,
improve or repair a residential structure or zero-lot-line
dwelling exceeds $2,000, the statement required under subsection
(1) of this section must be included in the written contract
required under ORS 701.305.
  (3) If a contract for the construction, improvement or repair
of a large commercial structure, small commercial structure,
residential structure or zero-lot-line dwelling is between a
contractor and the property owner, a subcontractor that performs
work on the structure or dwelling must provide the contractor
with a written statement that the subcontractor has a contractual
obligation to ensure that all work performed by the subcontractor
meets state building code requirements. The contractor shall
provide the written statement of the subcontractor to the
property owner. There is a conclusive presumption that a property
owner is an intended third-party beneficiary of the contractual
obligation stated by the subcontractor. + }
  SECTION 3. ORS 701.305 is amended to read:
  701.305. (1) A contractor may not perform work to construct,
improve or repair a residential structure or zero-lot-line
dwelling for a property owner without a written contract if the
aggregate contract price exceeds $2,000. If the price of a
contract was initially less than $2,000, but during the course of
performance the contract exceeds that amount, the contractor
shall mail or otherwise deliver a written contract to the
property owner not later than five days after the contractor
knows or should reasonably know that the contract price will
exceed $2,000.  Failure to have a written contract will not void
the contract.
  (2) The Construction Contractors Board shall adopt rules that
require a contractor to use standard contractual terms in a
construction contract for which subsection (1) of this section
requires a written contract. The standard contractual terms shall
be clear, use words of common understanding and shall include but
need not be limited to:
  (a) A statement that the contractor is licensed by the board;
  (b) The name, license number, address and telephone number of
the contractor as shown on board records on the date the contract
is entered into;
   { +  (c) A statement complying with section 2 of this 2011 Act
that the contractor shall:
  (A) Ensure that all work performed under the contract meets
state building code requirements; and
  (B) Obtain a written statement from any subcontractor that the
subcontractor shall ensure that work performed under the
subcontract meets state building code requirements; + }
    { - (c) - }  { +  (d) + } An acknowledgment of a written
offer of a warranty, if an offer is required by ORS 701.320, and
indication of the acceptance or rejection of the offered
warranty;
    { - (d) - }  { +  (e) + } A list of the notices required
under ORS 87.093 or under rules adopted under ORS 701.330 and
701.335 (2) on the contractor's bid proposal; and
    { - (e) - }  { +  (f) + } An explanation of the property
owner's rights under the contract, including, but not limited to,
the ability to file a claim with the board and the existence of
any mediation or arbitration provision in the contract, set forth
in a conspicuous manner as defined by the board by rule.
  SECTION 4.  { + Section 2 of this 2011 Act and the amendments
to ORS 701.305 by section 3 of this 2011 Act apply to work that a
construction contractor or a subcontractor performs pursuant to a
contract between a property owner and a construction contractor
entered into on or after the effective date of this 2011 Act. + }
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