Demystifying Legalese in Contracts, Part IV: Indemnification

On September 3, 2009

Demystifying Legalese in Contracts, Part IV: Indemnification

This is a post by guest blogger Jonathan I. Ezor.

jonathan_ezor.jpg The first blog in this series discussed how while some words do have legal weight, agreements should still be written in clear, understandable language in order to do what they're meant to. The second in the series examined warranties, and the third non-disclosure provisions. This fourth (and for now final) entry will focus on indemnification provisions.

Indemnification is a very straightforward concept: if party A does something that causes losses or damage to party B, A will pay to fix B. Indemnification encourages each party to concentrate on the risks it controls rather than worrying about problems only the other party can avoid. While either could sue the other to force payback in the event of a problem, putting an indemnification provision in the contract minimizes the time, expense and uncertainty of the process by at least hopefully avoiding the need for a lawsuit. The key to these provisions, though, is what is (and isn't) covered.

Here's the indemnification provision from the Web development agreement, written from the perspective of the client (which is important to know, as you'll see):

On September 3, 2009

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On September 3, 2009

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On September 3, 2009

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On September 3, 2009

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On September 3, 2009

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