Review of Indemnification Clauses

Please open or print the Indemnification Sample Clauses. There will be references below to these clauses.

 

One Way or Mutual

Unless Sponsor requests an indemnification from Institution, offer a form of indemnity that only runs one-way, from Sponsor to Institution.

 

Terms of Sponsor's Indemnity

  • Proper Parties - Must include the proper parties (no exceptions): "The University of Texas System ("System"), the University, its Regents, officers, agents, and employees"

  • Kinds of Claims

    •  Should cover all kinds of claims: "claims, demands, costs or judgments against them"

    •  May, under proper circumstances, be limited to "claims for personal injury, including death, and damage to property." (See Clause 5)

  • Arising/Resulting From

    •  Should cover us if we perform exactly as they request: "arising out of the activities to be carried out pursuant to the obligations of this Agreement"

    •  May, under proper circumstances, be limited to claims "arising directly out of administration of the study compound pursuant to the obligations of this Agreement." (See Clause 12.2)

    •  Should also cover claims resulting from their use of the results of the Study: "including, but not limited to, the use by Sponsor of the results obtained from the activities performed by University under this Agreement."

  • Carve-Outs - Sponsor may except from its obligations causes of action arising from our negligence:

    "the negligent failure of Institution to substantially comply with any applicable governmental requirements or to adhere to the terms of the protocol attached hereto as Exhibit A"
    OR

    "the negligence or willful malfeasance by a Regent, officer, agent, or employee of Institution or System."

  • Our Protocol - If the protocol is ours, we may require only a mutual negligence indemnity or no indemnity at all from Sponsor. (See Clause 3)

Terms of Institution's Indemnity

  • Institution Indemnifies - Only the Institution, not the System, indemnifies Sponsor. The System is not a party to the Agreement.
  • Indemnity Limited to that which is Authorized - The Institution only indemnifies Sponsor "to the extent authorized under the Constitution and laws of the State of Texas"
  • Negligence Only - The Constitution and laws of the State of Texas only permit us to indemnify Sponsor with respect to claims resulting from the negligence of our parties to the agreement, since the State of Texas has only waived its sovereign immunity with respect to negligence claims:

    "liability resulting from the negligent acts or omissions of Institution, its agents or employees pertaining to the activities to be carried out pursuant to the obligations of this Agreement"
  • Carve-Outs - We except from our obligations causes of action arising from "the negligence or willful malfeasance of Sponsor, its officers, agents, or employees, or any person or entity not subject to Institution's supervision or control." (See Clause 2.1)

Notice

If notice provisions are included, be sure they are reasonable. Limitations to fewer than 30 days are not generally reasonable and it is preferable to simply say that we will "promptly" give notice. (See Clause 5, Clause 12.1, and Clause 10.)

 

Cooperation in Defense of Claims; Control of Defense

  • Subject to Statutory Duties of Texas Attorney General

    •  If Sponsor requests control of and/or our full cooperation with its defense, inform Sponsor that the Texas Attorney General has a duty to defend us but that there are mechanisms whereby he will permit us to be represented by outside counsel

    •  Some Sponsor insurance carriers will not provide coverage if the Attorney General steps in. Please consult with OGC if you encounter this problem.

Conditions

Many examples of appropriate conditions to Sponsor's obligation to Indemnify are contained in Clauses 5 and 10. As a general rule, conditions should be limited in number and limited to those with which we would ordinarily and routinely comply even were we not required to do so by the terms of the Agreement. Other conditions should be evaluated on a case-by-case basis. Failure to comply with a condition should not affect Sponsor's obligation to indemnify if such non-compliance does not contribute to the injury for which we are seeking indemnification. (See last paragraph of Clause 10.)

 

 

Disclaimer: The materials on this website do not constitute legal advice. You should consult with an attorney before acting on or conveying any interpretation of these materials.

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