Will this indemnity cover the indemnitee's own negligence in New Jersey?
Only if the contract says so in terms: to bring a negligent indemnitee within an indemnification agreement the agreement must SPECIFICALLY REFERENCE the negligence or fault of the indemnitee. And in construction contracts a covenant purporting to indemnify the promisee against damages from bodily injury or property damage caused by or resulting from the SOLE negligence of the promisee, its agents or employees is void and unenforceable. The anti-indemnity statute's reach is its own first clause: any covenant "in, or in connection with or collateral to a contract, agreement or purchase order, relative to the construction, alteration, repair, maintenance, servicing, or security of a building, structure, highway, railroad, appurtenance and appliance, including moving, demolition, excavating, grading, clearing, site preparation or development of real property connected therewith" (§ 2A:40A-1). A companion section voids an indemnity of an architect, engineer or surveyor for damages caused by the design professional's own sole negligence in preparing or approving drawings, specifications and the like, or in giving or failing to give directions (§ 2A:40A-2). Neither section applies to a covenant made directly with a railroad about its right of way, or to a contract to which the State or its departments, agencies or authorities is a party (§ 2A:40A-3).
The trap
New Jersey's bright line is stricter than the general rule that clear language suffices, and it killed the workaround: Azurak held that Doloughty's distinction between “broad” and “limited” indemnification clauses “is no longer good law”, and the clause it struck was a sweeping one: PBS promised to indemnify the Mall "from and against any claim" ... "relating to, arising out of or existing by reason of" the contractor's performance of the agreement, and that did not reach the indemnitee's own negligence. The Court added that even if the broad-form notion had retained some vitality this clause would not have passed muster, because it "focused on PBS, thus eliminating the possibility of construing it to include the indemnitee’s negligence." The second trap is how little the statute actually voids: New Jersey's construction anti-indemnity statute voids only SOLE-negligence indemnity, so in New Jersey a clause that expressly covers the indemnitee's own negligence can still operate in shared-fault cases, but only if it named that negligence in the first place. Note § 2A:40A-1's saving clause: it does not affect the validity of an insurance contract or workers' compensation agreement issued by an authorized insurer, and the section leaves insurance contracts untouched.
6 authorities
The words that state the rule
To the extent that Doloughty distinguishes between “broad” and “limited” indemnification clauses and suggests that the former provides a way to include an indemnitee’s negligence within an indemnification agreement without explicitly referring to the indemnitee’s “negligence” or “fault,” it is no longer good law. It was implicitly overruled by Ramos and Mantilla , and we reaffirm that view here.
- statuteN.J. Stat. Ann. § 2A:40A-1enactment date not established
The words that state the rule
A covenant, promise, agreement or understanding in, or in connection with or collateral to a contract, agreement or purchase order, relative to the construction, alteration, repair, maintenance, servicing, or security of a building, structure, highway, railroad, appurtenance and appliance, including moving, demolition, excavating, grading, clearing, site preparation or development of real property connected therewith, purporting to indemnify or hold harmless the promisee against liability for damages arising out of bodily injury to persons or damage to property caused by or resulting from the sole negligence of the promisee, his agents, or employees, is against public policy and is void and unenforceable; provided that this section shall not affect the validity of any insurance contract, workmen's compensation or agreement issued by an authorized insurer.
- statuteN.J. Stat. Ann. § 2A:40A-2enactment date not established
The words that state the rule
A covenant, promise, agreement or understanding in, or in connection with or collateral to a contract, agreement or purchase order, whereby an architect, engineer, surveyor or his agents, servants, or employees shall be indemnified or held harmless for damages, claims, losses or expenses including attorneys' fees caused by or resulting from the sole negligence of an architect, engineer, surveyor or his agents, servants, or employees and arising either out of (1) the preparation or approval by an architect, engineer, surveyor or his agents, servants, employees or invitees, of maps, drawings, opinions, reports, surveys, change orders, designs or specifications, or (2) the giving of or the failure to give directions or instructions by the architect, engineer, surveyor or his agents, servants or employees; provided such giving or failure to give is the cause of the damage, claim, loss or expense, is against public policy and is void and unenforceable.
- statuteN.J. Stat. Ann. § 2A:40A-3enactment date not established
The words that state the rule
This act shall not apply to a covenant, promise or agreement made directly with a railroad relative to construction, alteration, repair, maintenance or access upon, under or across the right of way of an operating railroad. This act shall not apply to any contract, agreement, understanding or purchase order to which the State of New Jersey or any of its departments, agencies, or authorities is a party.
The words that state the rule
Contractor [PBS] shall indemnify, defend and hold harmless each Indemnitee [the Mall] from and against any claim (including any claim brought by employees of Contractor), liability, damage or expense (including attorneys’ fees) that such Indemnitee may incur relating to, arising out of or existing by reason of (i) Contractor’s performance of this Agreement or the conditions created thereby (including the use, misuse or failure of any equipment used by Contractor or its subcontractors, servants or employees) or (ii) Contractor’s breach of this Agreement or the inadequate or improper performance of this Agreement by Contractor or its subcontractors, servants or employees.
The words that state the rule
Moreover, even if the “broad form” notion retained some vitality, the indemnification provision in this case would not have passed muster. As the Appellate Division noted, the clause focused on PBS, thus eliminating the possibility of construing it to include the indemnitee’s negligence. Ibid. Finally, in order to allay even the slightest doubt on the issue of what is required to bring a negligent indemnitee within an indemnification agreement, we reiterate that *113 the agreement must specifically reference the negligence or fault of the indemnitee. The judgment of the Appellate Division is affirmed.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.