Senate Bill 2197 (Campbell – 1978)
Chapter 1374, Statutes of 1978 SB 2197
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Civil Code section 1670 was enacted in 1978 following passage of Senate Bill 2197. (See Exhibit #1d) Senator William Campbell introduced the bill on April 24, 1978 at the request of the Associated General Contractors Association. (See Exhibits #1a and #3) Senate Bill 2197 was a single-section bill that enacted Civil Code section 1670 only. (See Exhibit #1d)
While before the Legislature, Senate Bill 2197 was heard by the Senate Committee on Judiciary and the Assembly Committee on Judiciary. (See Exhibits #3 and #7) Senate Bill 2197 was amended twice, once in each House. (See Exhibits #1b, #1c, and #2) After approval by the Legislature Senate Bill 2197 was approved by Governor Edmund G. Brown, Jr. and recorded as Chapter 1374 of the Statutes of 1978. (See Exhibits #1d and #2)
The Legislative Counsel's Digest on the final amended version of the bill provides the following summary of Senate Bill 2197:
. . . Existing law permits a construction contract with a public agency to contain a provision that one party to the contract or that party's agent or employee shall decide all disputes arising under the contract.
This bill would provide that a dispute arising out of a construction contract with a public agency which provides that one party to the contract shall decide all disputes arising under that contract shall be resolved by submitting the dispute to independent arbitration if mutually agreeable; or a court of competent jurisdiction.
(See Exhibit #1c, page 1)
The analysis prepared for the Senate Committee on Judiciary provides the following statement of purpose for the bill:
The purpose of the bill is to enable construction contractors to obtain de novo review of disputes arising from contracts with public agencies.
(See Exhibit #3, page 1)