Be Careful Or You May Have to Indemnity Others For Their Own Negligence

Indemnity obligations are often found in construction contracts. The function of these undertakings, generally speaking, is to pass liability through from one party to the other where one party is actively liable and the other party is vicariously liable. In the construction context, such agreements or clauses may be drafted by a general contractor with the intention of passing through to a subcontractor the liability the general contractor owes to an owner for a loss. This is certainly fair where the indemnitor is actually the party that caused the loss. There exists a common law duty of indemnity where one (e.g. subcontractor) causes the loss and the other (e.g. contractor) is responsible for the loss by contract but did nothing to create the loss. More difficult to accept is an undertaking to indemnify someone from their own negligence. Florida Statute 725.06 imposes a requirement of a commercially reasonable monetary limit with respect to enforceability of the indemnity undertaking by contractors and subs by contract for the other’s negligence.  Read more…