Treatment of Indemnification Agreements in the Courts

Hold harmless (indemnification) agreements have been a source of much litigation due to their use as important risk transfer and liability apportionment devices. Courts are frequently called on to interpret and apply hold harmless provisions entered into by parties to contracts. When faced with the task of discerning the meaning and intent of an indemnification clause, courts apply rules generally applicable to all written contracts. However, because of the unique nature of hold harmless agreements, particular rules of interpretation have emerged that most courts apply to these agreements, and these rules vary from state to state.

Contractual Risk Transfer discusses the various rules of interpretation and includes a handy state-by-state summary of the applicable standards, which has recently been updated. If you work with risk allocation provisions in contracts and subscribe to Contractual Risk Transfer, check out the chart and the discussion at the applicable link below.