Time for Contract Term of the Day! Today I'm doing "indemnity," because it is not well understood and it can really bite your wallet in the ass. #grownostr #lawstr #contracttermoftheday #indemnity #defend
Indemnity is an obligation you can have just via common law, but it is also a contractual provision that safeguards one party from financial loss or damage caused by another party. It involves compensating the harmed party for expenses, losses, or liabilities incurred due to the responsible party's actions or omissions. You see indemnity provisions in contracts such as leases, construction or design agreements, employment agreements, and insurance policies. Enforceability may vary depending what state law applies.
Why do you care? If you enter into a contract with someone, and something you do causes them damage, it is your job to “make them whole.” But it can get a little crazy – many provisions include the term “defend” and indemnity. What does that mean? If your client / the other person gets sued and it is related to something you did under your contract, YOU have to pay for their lawyers, and yours! What? Right, I know, scary. Scary expensive. If you have good Commercial General Liability insurance, you’re covered. If you are working under a professional liability insurance policy, you are NOT covered for this “up front” defense – so it would be good to have a chat with your insurance person and see when and if you are covered for this.
If you don’t have insurance, YIKES. Lawyers are expensive. Don’t agree to this, bottom line.
(Necessary disclaimer – I’m A lawyer, but not YOUR lawyer, this is not an attorney/client relationship and you should seek counsel licensed in your jurisdiction for advice on any indemnity or contract issue)
agoristesq / Agorist, Esq.
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2023-05-22 17:59:26
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2023-05-22 17:59:26Event JSON
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"content": "Time for Contract Term of the Day! Today I'm doing \"indemnity,\" because it is not well understood and it can really bite your wallet in the ass. #grownostr #lawstr #contracttermoftheday #indemnity #defend \n\nIndemnity is an obligation you can have just via common law, but it is also a contractual provision that safeguards one party from financial loss or damage caused by another party. It involves compensating the harmed party for expenses, losses, or liabilities incurred due to the responsible party's actions or omissions. You see indemnity provisions in contracts such as leases, construction or design agreements, employment agreements, and insurance policies. Enforceability may vary depending what state law applies. \n\nWhy do you care? If you enter into a contract with someone, and something you do causes them damage, it is your job to “make them whole.” But it can get a little crazy – many provisions include the term “defend” and indemnity. What does that mean? If your client / the other person gets sued and it is related to something you did under your contract, YOU have to pay for their lawyers, and yours! What? Right, I know, scary. Scary expensive. If you have good Commercial General Liability insurance, you’re covered. If you are working under a professional liability insurance policy, you are NOT covered for this “up front” defense – so it would be good to have a chat with your insurance person and see when and if you are covered for this. \nIf you don’t have insurance, YIKES. Lawyers are expensive. Don’t agree to this, bottom line. \n\n(Necessary disclaimer – I’m A lawyer, but not YOUR lawyer, this is not an attorney/client relationship and you should seek counsel licensed in your jurisdiction for advice on any indemnity or contract issue) \n",
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