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Trikdagain

Question about indemnity clause

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Could someone please tell me exactly what I am agreeing to as the Subcontractor if I sign an agreement which contains the following indemnity clause: (my company is actually an Oklahoma LLC but the contract states it will be governed by the laws of the State of Kansas)

9.1.1 INDEMNITY: To the fullest extent permitted by law, the Subcontractor shall defend, indemnify and hold harmless the Contractor, the Contractor’s other subcontractors, the Architect/Engineer, the Owner and their agents, consultants and employees (the Indemnities) from all claims that may arise from any breach, violation or default by contractor or its employees, agents, representatives, Subcontractors, or Sub subcontractors, or any employees, agents, representatives or contractors of any foregoing, of contractors obligations under the contract documents including, without limitation, any violation of any law, statute, ordinance, order, rule or regulation, including, without limitation, any Environmental Law and the Storm Water Requirements.

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Brief translation: If you commit "any breach, violation or default . . . [of any] obligations under the contract documents," you will be liable to "the Contractor, the Contractor’s other subcontractors, the Architect/Engineer, the Owner and their agents, consultants and employees" for any damages that result.  Additionally, if anyone makes claims against any of those entities, you could be called on to defend and indemnify them.

 

This sort of provision is ubiquitous, and any general contractor who knows what it's doing will include such a provision in its subcontracts.

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 Thank you for your response.  I interpreted the following underlined text:  

 

"...from all claims that may arise from any breach, violation or default by contractor or its employees, agents, representatives, Subcontractors, or Sub subcontractors, or any employees, agents, representatives or contractors of any foregoing, of contractors obligations ..."

 

to mean that we, as the subcontractor, would  be liable for any damages resulting from any breach, violation or default committed by any of the indemnities and not just any breach, violation of default which we committed.  

 

Also, does the following underlined language:  

 

"...of contractors obligations under the contract documents including, without limitation, any violation of any law, statute, ordinance, order, rule or regulation, including, without limitation, any Environmental Law and the Storm Water Requirements".

 

mean that if any of the indemnities breaks any law, statute, ordinance, etc. that we, as the subcontractor, could be called on to defend and indemnify them even in the absence of any negligence on our part?    

 

Thank you so much for your help.  We are a small start up company and can't afford legal counsel at this time.  We need this companies business but  can't afford to sign a contract that may create uninsurable losses for us as I am pretty sure out E&O insurance policy contains a contractual liability exclusion.      

 

How could we revise this clause to ensure that we indemnify the contractor et al., only to the extent of damages caused by our negligence or the negligence of others for whom we are legally responsible? 

 

 

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1 hour ago, Trikdagain said:

I interpreted the following underlined text:  

 

"...from all claims that may arise from any breach, violation or default by contractor or its employees, agents, representatives, Subcontractors, or Sub subcontractors, or any employees, agents, representatives or contractors of any foregoing, of contractors obligations ..."

 

to mean that we, as the subcontractor, would  be liable for any damages resulting from any breach, violation or default committed by any of the indemnities and not just any breach, violation of default which we committed.

 

Let's clarify one thing.  Does the provision you quoted really say, "Subcontractor shall defend, indemnify and hold harmless the Contractor . . . from all claims that may arise from any breach, violation or default by contractor or its employees," etc.?  Also, please confirm that the terms "Subcontractor," "Contractor" and "contractor" (the three terms that I just underlined) are exactly as they appear in the document (i.e., the first two have an initial upper-case letter and the third is all lower case).

 

You should be agreeing to indemnify for breaches/violations committed by you, your employees, your agents, your subcontractors, etc., but you should not be agreeing to indemnify the other party for breaches/violations committed by that other party.

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1 hour ago, pg1067 said:

Does the provision you quoted really say, "Subcontractor shall defend, indemnify and hold harmless the Contractor . . . from all claims that may arise from any breach, violation or default by contractor or its employees," etc.?  Also, please confirm that the terms "Subcontractor," "Contractor" and "contractor" (the three terms that I just underlined) are exactly as they appear in the document (i.e., the first two have an initial upper-case letter and the third is all lower case).

 

Yes, I cut and pasted the language straight from the contract into my post.  

 

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2 hours ago, pg1067 said:

The language that obligates you to indemnify the "Contractor" for breaches/violations by the "contractor" is quite problematic.  I strongly suggest you run this by a local attorney for advice.

 

That is what I thought.   I appreciate all your help.  Although we can't afford an attorney at this time I think I can come up with language that  ensures that we indemnify the contractor et al., only to the extent of damages caused by our own  negligence or the negligence of others for whom we are legally responsible.  I hope the contractor will accept the change.  I can't thank you enough for all your help!

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