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Provision in indemnity agreement that covers losses due to indemnities’ own negligence must be in clear and unequivocal language.

October 18, 2013
Burlington Coat Factory of Pennsylvania, LLC v. Grays Construction Management Company, LLC, 2013 PHILA. Ct. Com. PL. LEXIS 259

The Court of Common Pleas in Philadelphia County reaffirmed that, if parties intend to include within the scope of their indemnity agreement a provision that covers losses due to the indemnities’ own negligence, they must do so in clear and unequivocal language. Words of general inference cannot establish such indemnification. In this matter, a contract had named a store operator as an additional insured on the contractor’s policies. However, the contract did not require that the contractor’s insurer be primary. Therefore, no breach of contract by the contractor occurred due to the insurer’s refusal to provide coverage for an underlying personal injury action of a subcontractor’s employee. The contract did not require the contractor to provide indemnification for the negligence of the operator or its agents. Since only the store operator could have been found liable for negligence at trial based on the evidence presented, the contractor had no duty under the contract to indemnify the store operator for the underlying action. Summary judgment was granted to the contractor and denied to the store operator.

Case Law Alert, 4th Quarter 2013

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