Will a Utah court enforce a clause making one party indemnify the other for the other's own negligence?
Not in a construction contract between construction parties: except as subsection (3) provides, an indemnification provision in a construction contract is against public policy and void and unenforceable (§ 13-8-1(2)). A construction contract for that purpose is one between a construction manager, general contractor, subcontractor, sub-subcontractor, supplier or any combination of them, with 'indemnification provision' meaning a covenant in, in connection with, or collateral to a construction contract requiring the promisor to insure, hold harmless, indemnify or defend the promisee or others against liability for bodily injury, property damage or economic loss caused by or resulting from the fault of the promisee, indemnitee, others or their agents or employees. Outside construction, an indemnity agreement that purports to make a party respond for the negligence of another is strictly construed, and it is upheld where the intention to indemnify a person against his own negligence is clearly and unequivocally expressed (Freund v. Utah Power & Light; Shell Oil v. Brinkerhoff-Signal Drilling).
The trap
Specific words are not always required: in Freund the licensee's promise to indemnify against 'any and all' liabilities, with express carve-outs only for the licensor's intentional wrongdoing or willful negligence, was held a clear and unequivocal agreement to cover the licensor's negligence; Cunningham v. Weber County later said those carve-outs helped transform what might have been mistakable language into a clear and unmistakable expression of intent. Section 13-8-1's definition also reaches promises to 'insure' and to indemnify for 'economic loss', and § 13-8-1(3) apportions an owner's fault among the construction parties in some cases. The section does not affect or impair contracts in existence when it, or an amendment to it, took effect. Freund's carve-out was narrower than the trap's shorthand suggests: the exception ran to the licensor's intentional wrongdoing or willful negligence in the interruption of the licensee's service. Shell Oil upheld the clause before it and reversed the judgment against the indemnitee, but the clause there itself excepted damage resulting from the indemnitee's sole negligence, and Shell Oil describes § 13-8-1 as it stood in 1983, when the court read it as reaching an indemnity for the promisee's sole negligence and held it inapplicable outside the construction industry.
10 authorities
- statuteUtah Code § 13-8-1enactment date not established
The words that state the rule
"Indemnification provision" means a covenant, promise, agreement or understanding in, in connection with, or collateral to a construction contract requiring the promisor to insure, hold harmless, indemnify, or defend the promisee or others against liability if: the damages arise out of: bodily injury to a person; damage to property; or economic loss; and the damages are caused by or resulting from the fault of the promisee, indemnitee, others, or their agents or employees.
The words that state the rule
In a long line of cases spanning more than fifty years, we have repeatedly held that an indemnity agreement which purports to make a party respond for the negligence of another should be strictly construed.
The words that state the rule
We conclude that paragraph 21 as a whole expresses a clear and unequivocal intent by the parties that the licensee will indemnify the licensor from any and all liabilities, including the liability that arises because of the licensor’s negligence, except when liability arises because of the li-censor’s intentional wrongdoing or willful negligence in the interruption of the licensee’s service.
- case658 P.2d 1187Shell Oil Co. v. Brinkerhoff-Signal Drilling Co.Utahdecided 1983read it at the source ↗
The words that state the rule
we have frequently adhered to the majority rule that where the intention to indemnify a person from losses attributable to his own negligence is “clearly and unequivocally expressed” in the contract language, an indemnity agreement will be upheld. Howe Rents Corp. v. Worthen, 18 Utah 2d at 265 , 420 P.2d at 849 ; Union Pacific Railroad v. El Paso Natural Gas Co., 17 Utah 2d at 251 , 408 P.2d at 913-14 ; Barrus v. Wilkinson, 16 Utah 2d 204 , 398 P.2d 207 (1965). See also United States v. Seckinger, 397 U.S. 203, 211 , 90 S.Ct. 880, 885 , 25 L.Ed.2d 224 (1970). The indemnity provision challenged here meets that requirement, and is upheld under those authorities.
The words that state the rule
the specific carveouts for intentional wrongdoing and willful negligence helped transform what might have been mistakable language into a clear and unmistakable expression of an intent to extend the indemnification to negligent acts.
- statuteUtah Code § 13-8-1enactment date not established
The words that state the rule
Except as provided in Subsection (3) , an indemnification provision in a construction contract is against public policy and is void and unenforceable. When an indemnification provision is included in a contract related to a construction project between an owner and party listed in Subsection (1)(a) , in any action for damages described in Subsection (1)(b)(i) , the fault of the owner shall be apportioned among the parties listed in Subsection (1)(a) pro rata based on the proportional share of fault of each of the parties listed in Subsection (1)(a) , if: the damages are caused in part by the owner; and the cause of the damages defined in Subsection (1)(b)(i) did not arise at the time and during the phase of the project when the owner was operating as a party defined in Subsection (1)(a) .
- statuteUtah Code § 13-8-1enactment date not established
The words that state the rule
For purposes of this section: "Construction contract" means a contract or agreement relative to the design, construction, alteration, repair, or maintenance of a building, structure, highway, appurtenance, appliance, or other improvement to real property, including moving, demolition, or excavating, connected to the construction contract between: a construction manager; a general contractor; a subcontractor; a sub-subcontractor; a supplier; or any combination of persons listed in Subsections (1)(a)(i) through (v) .
- statuteUtah Code § 13-8-1enactment date not established
The words that state the rule
This section may not be construed to affect or impair the obligations of contracts or agreements, that are in existence at the time this section or any amendment to this section becomes effective.
- case658 P.2d 1187Shell Oil Co. v. Brinkerhoff-Signal Drilling Co.Utahdecided 1983read it at the source ↗
The words that state the rule
Hence, the Comparative Negligence Act does not invalidate an employer’s indemnity contract with a third party. The summary judgment against Shell is reversed, and the cause is remanded for reinstatement of Shell’s third-party complaint and for further proceedings consistent with this opinion. Costs to appellant.
- case658 P.2d 1187Shell Oil Co. v. Brinkerhoff-Signal Drilling Co.Utahdecided 1983read it at the source ↗
The words that state the rule
2 . Respondent cites U.C.A., 1953, § 13-8-1 as further evidence that our legislative and judicial policy disfavors indemnity agreements. That statute, which is entitled “Construction industry — Agreements to indemnify,” provides that an agreement for the construction, repair or maintenance of a building which purports to indemnify the promisee for liability resulting from the promisee’s “sole negligence” is “void and unenforceable” as against public policy. Since, by its own terms, the statute applies only to the construction industry, it is inapplicable here. Moreover, even if the statute were applied, the contract provision challenged here would not be invalidated since it makes exception for injury, death or damage that has “resulted from the sole negligence of Operator [Shell], without negligence or willful act on the part of Contractor [Brinkerhoff], its agents, servants, employees, or subcontractors.” (Emphasis added.)
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.