For years, employers, owners and contractors have used indemnity agreements in contracts. Regardless of ultimate responsibility for the loss, an indemnity agreement can help you shift the cost of damages and legal fees to another party. Smiley Law has years of experience drafting construction contracts, which include indemnity agreements that reduce the cost of construction and account for any potential litigation that may come up.

Indemnification: Nuts & Bolts

Though an indemnity agreement can be one of the most effective ways to protect against future costs associated with injury or damages, it also comes with limitations. Here are some key points to keep in mind as you decide how best to proceed:

1. What protection does an indemnity agreement provide?

Under Louisiana law, an indemnity is simply seen as a matter of reimbursement. Indemnity clauses are set up to release you, the indemnitee, from paying for damage caused by certain actions specified in the indemnity agreement. The person or company signing the indemnity agreement, the indemnitor, assumes the financial responsibility if your actions under the agreement cause damage.

You can imagine that in the often, hazardous world of construction, indemnity agreements are incredibly vital components of a contract, and something that you cannot afford to leave to chance. At Smiley Law we draft your indemnification agreement to be legally enforceable while mitigating potential risks.

2. What are the limitations of an indemnity agreement?

Many states have passed laws that limit the reach of indemnification clauses. In Louisiana, the following acts may NOT be covered by an indemnification agreement:

  • Damages related to wells for oil, gas or water.
  • Liability resulting from negligent or intentional acts or omissions of the indemnitee in construction or motor carrier transportation contracts.
  • Generally a person or company in Louisiana cannot indemnify against negligence, intentional acts and/or omissions.

Indemnification can be used for various claims, including those arising from compensation related to injury or damage to property, legal costs, and even for breach of contract.

Getting Started Right: Indemnity Agreements by Smiley Law

Indemnity agreements are critical to the success of your construction contract. If you have questions about or want to draft an indemnity agreement for your construction project, contact the attorneys at Smiley Law today. With years of experience in drafting indemnity agreements and defending future claims, our attorneys can help ensure you are well protected in your contractual obligations.

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