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Indemnification Clauses:
Getting Paid in Light of Contract Provisions

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Clauses in construction contracts where the promisor indemnifies "against liability for damages arising out of bodily injury to persons or damage to property . . caused by the negligence of the promisee" are against public policy and void. Ohio Revised Code §2305.31.

Accordingly, an agreement between an owner and a contractor, whereby the contractor agreed to indemnify the owner for any claims related to the contractor's work, was void and did not require a contractor to indemnify an owner against a claim by the contractor's employee against the owner for injuries suffered on the job allegedly caused by the owner's negligence. Kendall v. U.S. Dismantling Co., 20 Ohio St. 2d 61 (1985).

The Cuyahoga County Court of Appeals has interpreted the statute to prohibit requirements in a construction contract that the contractor name another an additional insured on his CGL policy to insure against the owner's negligence. Buckeye Union Ins. Co.v. Zavarella Bros. Constr. Co., 1997 Ohio App. LEXIS 2934 (July 3, 1997).

The statute also invalidates any requirement for the contractor to pay the owner's attorneys fees and costs in a lawsuit arising from the contractor's work for the owner, if such a requirement is contained within a void indemnification clause. Moore v. Dayton Power & Light Co., 99 Ohio App. 3d 138 (1994).

In negotiating the Fairness in Construction Contracting legislation, there was an effort to codify the concept that a construction contract requiring the promisor to pay the promisee attorneys' fees and costs in an action alleging the promisee negligence was void as against public policy. That effort has apparently failed.

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