Limited Indemnity Clause
(by Contractor of Owner for Third Party Claims and Optional Indemnity by Owner of Contractor)

Summary

This limited indemnity clause may be included in a construction contract between an owner and contractor. It requires the contractor to indemnify the owner only if the claim arises in whole or in part from the negligent acts or omissions of the contractor. The contractor is not responsible for the negligent acts or omissions of the owner. This limited indemnity clause includes an optional reciprocal indemnity made by the owner to the contractor. It should be noted that most states have anti-indemnity statutes, which may result in certain indemnities being found void and unenforceable. Therefore, when drafting an indemnity clause, it is important to be familiar with the state statutes and case law that may affect the enforceability of such indemnity. See the drafting note to this clause for a discussion of anti-indemnity statutes and drafting and negotiation strategies for indemnity clauses. The capitalized terms used in this clause should be conformed to the defined terms in the relevant construction contract. This clause includes practical guidance, drafting notes, and an optional clause. For a full listing of key content covering purchasing and selling commercial real estate, see Owner and Contractor Agreement Resource Kit. For a full listing of key content covering construction, see Construction Resource Kit. For a survey of anti-indemnity statutes by state, see Anti-Indemnity Statute State Law Survey. For additional guidance on owner-contractor agreements, see Owner-Contractor Agreements.