A provision in a contract that requires one contracting party to respond to certain legal liabilities of the other party.
- For example, construction contracts typically require the contractor to indemnify the owner of the property with respect to the owner’s liability to members of the public who are injured or whose property is damaged during the course of the contractor’s operations. There are a number of types of hold harmless clauses, differentiated by the extent of the liabilities they transfer. The most commonly used types of clauses are the “broad,” “intermediate,” and “limited” form hold harmless clauses.
Limited form—Where Party A holds Party B harmless for suits arising out of Party A’s sole negligence. Party B is thus protected when it is held vicariously responsible for the actions of Party A.
Intermediate form—Where Party A holds Party B harmless for suits alleging sole negligence of Party A or negligence of both parties.
Broad form—Where Party A holds Party B harmless for suits against Party B based on the sole negligence of A, joint negligence of A and B, or the sole negligence of B. Broad form hold harmless agreements are unenforceable in a number of states.