Hold Harmless Agreement

So what would happen if an employee under your supervision accidentally does something wrong inside work hours and a client bears the damage? The client would probably get ready to sue you and not the employee, because he/she was under your supervision. It would mean you would personally have to pay for what your employee did while you had little or no control over it. This is where the hold harmless agreement comes into picture. Hold harmless agreement is often a very important part of a contract. So, before entering into a contract, always take some time to read through it thoroughly before signing it.

Hold Harmless Agreement

Let me start with the basics of what is a contract. A contract is an agreement signed by two or more parties and is legally enforceable. Now, when two parties sign a contract, it indicates that they have been through the contract and agree on the terms and conditions contained in it. For example, let us take a construction contract. When an individual construction company enters into a contract with a labor contractor, there are several things in the contract that the two parties agree on, the materials to be used, the supply, the completion and the remuneration. And when the contractor and the company sign the contract, it means that all the terms and conditions of the contract are mutually agreed upon.

Now, what is the hold harmless agreement in the scheme of things? This agreement is one of the terms and conditions contained in the contract. Continuing the previous example of a construction company, the contractor for completing the work may demand that the construction company sign the hold harmless agreement. By signing the hold harmless agreement, the construction company agrees that any losses or any calamity at the construction site will not be the responsibility of the contractor and the loss of money and materials in any such situation will be borne by the construction company. Often, it may so happen that there are some mishaps on the construction site during any process. The contractor or any other person may choose to wash his hands off the ensuing liability of loss, by making the construction company sign the hold harmless agreement. By signing the hold harmless agreement, the construction company basically chooses to undertake all the losses that may arise during the process of construction.

Now the question which might come up in your mind is why would any person, the construction company in this case, would choose to sign the hold harmless agreement when clearly it puts them in a position of disadvantage? The construction company signs such an agreement at the behest of the contractor. The contractor may often work only under such a condition where the company chooses to sign the hold harmless clause. So, if the contractor has enough clout to swing things his way, he can do so.

Hold Harmless Agreement Template

Here's the hold harmless agreement sample to make things easier for you to understand and use. This example will assume there is Mr. Roberts, the construction company manager on one hand and Mr. Murphy, the contractor on the other hand. Mr. Roberts drafts this hold harmless agreement for contractors, in this case, Mr. Murphy.

"M/s Roberts Constructions, its successors and assigns, hereby agrees to save and hold harmless the M/s Murphy Contractors and any of its employee from all cost, injury and damage incurred by any of the above, and from any other injury or damage to any person or property whatsoever, any of which is caused by an activity, condition or event arising out of the performance, preparation for performance or nonperformance of any provision of this agreement by M/s Murphy Contractors. The above cost, injury, damage or other injury or damage incurred by or to any of the above shall include, in the event of an action, court costs, expenses of litigation and reasonable attorneys' fees. This save harmless clause is not intended to indemnify against any cost or damage, or portion thereof, caused by M/s Murphy Contractors". IN WITNESS WHEREOF, the parties hereto have hereunto set their hands this _______________day of _______________________, 20_______. ________________________________________ RESPONSIBLE PARTY SIGNATURE

So, this was all about hold harmless agreement. The hold harmless agreement puts one party into a great advantage and they need not worry about the losses that they may incur and can go on with their job without much hassle.