Indemnity and Liability Clause Pack - New York

INDEMNITY AND LIABILITY CLAUSE PACK — NEW YORK

Jurisdiction: State of New York
Governing Law: New York Laws; New York common law
Template Version: 2026-02-26

TABLE OF CONTENTS

• PART I: Legal Framework
• PART II: Corporate Indemnification Clauses
• PART III: Contractual Indemnity Clause Pack
• PART IV: Limitation of Liability Clauses
• PART V: Anti-Indemnity Considerations
• PART VI: Insurance Requirements
• PART VII: New York-Specific Practice Notes
• Sources and References

PART I: LEGAL FRAMEWORK

1.1 New York Corporate Indemnification Statutes

New York corporate indemnification is governed by New York Business Corporation Law (BCL) §§ 721 through 726. New York's indemnification framework is more restrictive than the Revised Model Business Corporation Act in certain respects, particularly regarding the limitation on providing indemnification inconsistent with the statutory provisions.

Statutory Structure:

Key provisions:

• Permissive indemnification — third-party actions (BCL § 722(a)): A corporation may indemnify any person made, or threatened to be made, a party to an action or proceeding other than one by or in the right of the corporation, including a criminal action or proceeding, by reason of the fact that the person was a director or officer of the corporation, against judgments, fines, amounts paid in settlement, and reasonable expenses including attorney fees, if such director or officer acted in good faith, for a purpose reasonably believed to be in the best interests of the corporation, and in criminal actions or proceedings, in addition had no reasonable cause to believe the conduct was unlawful.

• Permissive indemnification — derivative actions (BCL § 722(c)): A corporation may indemnify any person who was a director or officer in actions by or in the right of the corporation against amounts paid in settlement and reasonable expenses (including attorney fees) actually and reasonably incurred, if the director or officer acted in good faith and for a purpose reasonably believed to be in the best interests of the corporation. However, no indemnification is permitted if the person was adjudged to be liable to the corporation, unless a court determines the person is entitled to indemnification.

• Mandatory indemnification (BCL § 722(a)/723(a)): A person who has been successful, on the merits or otherwise, in the defense of a civil or criminal action or proceeding shall be entitled to indemnification as authorized in BCL § 722.

• Authorization requirement (BCL § 723): Indemnification (unless ordered by a court under § 724) shall be made by the corporation only if authorized in the specific case by: (a) the board acting by a quorum consisting of directors who are not parties to the action or proceeding; or (b) if a quorum of disinterested directors is not obtainable, the board upon the opinion in writing of independent legal counsel that indemnification is proper under the circumstances; or (c) the shareholders.

• Advancement of expenses (BCL § 725(a)): Expenses incurred in defending a civil or criminal action or proceeding may be paid by the corporation in advance of the final disposition upon receipt of an undertaking by or on behalf of the director or officer to repay such amount as, and to the extent, required by BCL § 725(b).

• Nonexclusivity with limitation (BCL § 721): The indemnification and advancement of expenses authorized by BCL §§ 722 through 726 shall not be deemed exclusive of any other rights to which a director or officer may be entitled; however, no indemnification may be made to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes that the director's or officer's acts were committed in bad faith or were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated, or that the director or officer personally gained in fact a financial profit or other advantage to which the director or officer was not legally entitled.

• Insurance (BCL § 726): A corporation shall have the power to purchase and maintain insurance on behalf of any person who is or was a director or officer against any liability asserted against the person and incurred by the person in any such capacity, whether or not the corporation would have the power to indemnify the person under BCL Article 7.

1.2 Common Law Indemnity in New York

New York recognizes both express and implied indemnity:

• Express indemnity: New York courts enforce contractual indemnity agreements according to their terms. An indemnification clause can cover the indemnitee's own negligence if it is expressed in "unmistakable terms" (Gross v. Sweet, 49 N.Y.2d 102 (1980)).
• Implied indemnity (common law contribution): Under Dole v. Dow Chemical Co., 30 N.Y.2d 143 (1972), a tortfeasor may seek contribution from a joint tortfeasor based on relative fault. New York General Obligations Law § 15-108 and CPLR Article 14 govern contribution among joint tortfeasors.
• Workers' Compensation bar: Under N.Y. Workers' Compensation Law § 11, an employer's liability for contribution or indemnity from a third party is limited to the employer's workers' compensation liability, unless the third party proves the employee sustained a "grave injury" as defined by the statute.

1.3 Contractual Indemnity Under New York Law

New York enforces contractual indemnity provisions subject to the following rules:

• Clear and unambiguous language: A party may agree to indemnify another for the indemnitee's own negligence, but the agreement must be expressed in "unmistakable terms" (Gross v. Sweet).
• GOL § 5-322.1: Anti-indemnity restrictions in construction contracts (see Part V).
• GOL § 5-321: Exculpatory clauses in leases exempting lessors from liability for negligence are void and unenforceable.
• Anti-subrogation rule: An insured cannot be subrogated to a claim against its own insured for a covered loss.

PART II: CORPORATE INDEMNIFICATION CLAUSES

2.1 Mandatory Indemnification Provision

CLAUSE 2.1 — MANDATORY INDEMNIFICATION

The Corporation shall indemnify each person who was or is a party to, or is threatened to be made a party to, any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (including any action by or in the right of the Corporation), by reason of the fact that such person is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director or officer of another corporation, partnership, joint venture, trust, or other enterprise, to the fullest extent permitted by New York Business Corporation Law §§ 721 through 726, as the same exist or may hereafter be amended, against judgments, fines, amounts paid in settlement, and reasonable expenses (including attorney fees) actually and reasonably incurred in connection with such action, suit, or proceeding.

Mandatory Component (BCL § 722(a)/723(a)): A person who has been successful, on the merits or otherwise, in the defense of a civil or criminal action or proceeding of the character described above shall be entitled to indemnification as authorized in BCL § 722, without the necessity of any authorization under BCL § 723.

Limitation (BCL § 721): Notwithstanding the foregoing, no indemnification shall be made to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes that: (a) the director's or officer's acts were committed in bad faith or were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated; or (b) the director or officer personally gained in fact a financial profit or other advantage to which the director or officer was not legally entitled.

2.2 Permissive Indemnification Resolution

CLAUSE 2.2 — BOARD RESOLUTION FOR PERMISSIVE INDEMNIFICATION

RESOLVED, that the Corporation shall indemnify [________________________________] ("Indemnitee") against judgments, fines, amounts paid in settlement, and reasonable expenses (including attorney fees) actually and reasonably incurred in connection with [________________________________] (the "Proceeding"), subject to the following:

(a) The required authorization has been obtained under BCL § 723 by:

☐ The Board of Directors acting by a quorum consisting of directors who are not parties to the Proceeding

☐ The Board upon the written opinion of independent legal counsel (if a disinterested quorum is not obtainable) that indemnification is proper under the circumstances

☐ The shareholders

(b) For third-party proceedings (BCL § 722(a)): Indemnitee acted in good faith, for a purpose reasonably believed to be in the best interests of the Corporation, and in criminal proceedings, had no reasonable cause to believe the conduct was unlawful.

(c) For derivative proceedings (BCL § 722(c)): Indemnitee acted in good faith and for a purpose reasonably believed to be in the best interests of the Corporation. No indemnification for amounts paid to the Corporation in settlement or judgment if Indemnitee was adjudged liable to the Corporation, unless a court determines indemnification is appropriate.

2.3 Advancement of Expenses

CLAUSE 2.3 — ADVANCEMENT OF EXPENSES

The Corporation shall pay expenses (including attorney fees) incurred by a director or officer of the Corporation in defending any civil or criminal action, suit, or proceeding in advance of the final disposition of such action, suit, or proceeding, pursuant to BCL § 725(a), upon receipt of an undertaking by or on behalf of such director or officer to repay such amount as, and to the extent, required by BCL § 725(b).

The Corporation may also advance expenses to employees and agents who are not directors or officers on such terms and conditions as the Board of Directors deems appropriate.

2.4 Directors and Officers Insurance

CLAUSE 2.4 — D&O INSURANCE AUTHORIZATION

Pursuant to BCL § 726, the Corporation shall purchase and maintain insurance on behalf of any person who is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director or officer of another corporation, partnership, joint venture, trust, or other enterprise, against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person's status as such, whether or not the Corporation would have the power to indemnify such person against such liability under Article 7 of the Business Corporation Law.

Minimum Coverage Parameters:

☐ Each-occurrence limit: $[________________________________]

☐ Annual aggregate limit: $[________________________________]

☐ Retention/deductible: $[________________________________]

☐ Policy form: ☐ Claims-made ☐ Occurrence

☐ Tail coverage period (if claims-made): [____] years

2.5 Nonexclusivity with Statutory Floor

CLAUSE 2.5 — NONEXCLUSIVITY

Pursuant to BCL § 721, the rights to indemnification and advancement of expenses conferred by this Article shall not be exclusive of any other rights to which any director or officer seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of shareholders or disinterested directors, or otherwise, both as to action in such person's official capacity and as to action in another capacity while holding such office, subject to the limitation set forth in BCL § 721 (no indemnification where a final adjudication establishes bad faith, active and deliberate dishonesty material to the action, or receipt of a financial profit or advantage to which the person was not legally entitled).

PART III: CONTRACTUAL INDEMNITY CLAUSE PACK

3.1 Mutual Indemnification (Balanced)

CLAUSE 3.1 — MUTUAL INDEMNIFICATION

Each party (when acting as the "Indemnifying Party") shall indemnify, defend, and hold harmless the other party and its officers, directors, employees, agents, successors, and permitted assigns (collectively, the "Indemnified Parties") from and against any and all third-party claims, demands, actions, suits, proceedings, losses, damages, liabilities, judgments, fines, penalties, costs, and expenses (including reasonable attorney fees and court costs) (collectively, "Losses") arising out of or relating to:

(a) Any material breach of any representation, warranty, or obligation of the Indemnifying Party under this Agreement;

(b) The gross negligence or willful misconduct of the Indemnifying Party or its officers, directors, employees, agents, or subcontractors;

(c) Any infringement or misappropriation of any third-party intellectual property right by the Indemnifying Party's materials, products, or services provided under this Agreement; or

(d) Any violation of applicable law by the Indemnifying Party in the performance of its obligations under this Agreement,

in each case, except to the extent such Losses arise from the negligence or willful misconduct of the Indemnified Parties or from the Indemnified Parties' breach of this Agreement.

New York Practice Note: Under New York law, an indemnity clause may cover the indemnitee's own negligence if expressed in "unmistakable terms" (Gross v. Sweet, 49 N.Y.2d 102 (1980)). This clause limits each party's indemnification obligation to Losses arising from the Indemnifying Party's own acts, avoiding potential enforceability issues.

3.2 One-Way Indemnification (Provider to Customer)

CLAUSE 3.2 — PROVIDER INDEMNIFICATION OF CUSTOMER

Provider shall indemnify, defend, and hold harmless Customer and its officers, directors, employees, agents, successors, and permitted assigns from and against any and all Losses arising out of or relating to:

(a) Any third-party claim alleging that Customer's authorized use of Provider's products or services infringes, misappropriates, or otherwise violates any patent, copyright, trademark, trade secret, or other intellectual property right of a third party;

(b) Provider's material breach of any representation, warranty, or obligation under this Agreement;

(c) The gross negligence or willful misconduct of Provider, its employees, agents, or subcontractors; or

(d) Provider's violation of applicable law.

Exclusions from Provider's Indemnification Obligation:

Provider's obligations under this Section shall not apply to claims arising from: (i) modifications to Provider's products or services made by Customer without Provider's written approval; (ii) use of Provider's products or services in combination with third-party products, services, or materials not supplied or approved by Provider; (iii) Customer's use of Provider's products or services in violation of this Agreement or applicable law; or (iv) Customer's continued use after being notified of the alleged infringement and provided a non-infringing alternative.

Mitigation Remedies: If any product or service becomes, or in Provider's reasonable opinion is likely to become, the subject of an infringement claim, Provider may, at its sole option and expense: (1) procure for Customer the right to continue using the affected product or service; (2) replace or modify the affected product or service to make it non-infringing without material degradation in functionality; or (3) if neither (1) nor (2) is commercially practicable, terminate the affected product or service and refund to Customer any prepaid, unused fees.

3.3 Customer Indemnification (Customer to Provider)

CLAUSE 3.3 — CUSTOMER INDEMNIFICATION OF PROVIDER

Customer shall indemnify, defend, and hold harmless Provider and its officers, directors, employees, agents, successors, and permitted assigns from and against any and all Losses arising out of or relating to:

(a) Any third-party claim arising from Customer Data, including claims of defamation, invasion of privacy, or infringement of intellectual property rights;

(b) Customer's use of Provider's products or services in violation of applicable law or this Agreement;

(c) Customer's use of Provider's products or services in combination with third-party systems, products, or materials not supplied or approved by Provider, to the extent such combination gives rise to the claim; or

(d) Customer's gross negligence or willful misconduct.

3.4 Third-Party Claims Procedure

CLAUSE 3.4 — THIRD-PARTY CLAIMS PROCEDURE

(a) Notice. The Indemnified Party shall promptly notify the Indemnifying Party in writing of any third-party claim for which indemnification is sought (a "Claim Notice"). The Claim Notice shall describe the claim in reasonable detail and include copies of relevant pleadings, correspondence, or documents. The failure to provide prompt notice shall not relieve the Indemnifying Party of its indemnification obligations except to the extent the Indemnifying Party is materially prejudiced by such failure.

(b) Defense. The Indemnifying Party shall have the right, at its sole cost and expense, to assume and control the defense of any claim for which it is obligated to provide indemnification, using counsel of its own choosing reasonably acceptable to the Indemnified Party. The Indemnified Party shall cooperate in all reasonable respects.

(c) Participation. The Indemnified Party may participate in the defense of any claim with its own counsel and at its own expense; provided, however, that if the Indemnifying Party fails to assume the defense within [____] business days after receiving the Claim Notice, or if a conflict of interest makes it inappropriate for the same counsel to represent both parties, the Indemnified Party may assume the defense at the Indemnifying Party's expense.

(d) Settlement. The Indemnifying Party shall not settle any claim without the Indemnified Party's prior written consent (not to be unreasonably withheld, conditioned, or delayed) if the settlement: (i) imposes any non-monetary obligation on, or requires any admission of liability by, the Indemnified Party; (ii) does not include a complete and unconditional release of the Indemnified Party; or (iii) involves the payment of money for which the Indemnified Party will not be fully indemnified.

(e) Cooperation. The Indemnified Party shall make available to the Indemnifying Party all relevant records, documents, and information, and shall provide reasonable assistance and cooperation, at the Indemnifying Party's expense.

3.5 Direct Claims Between Parties

CLAUSE 3.5 — DIRECT CLAIMS PROCEDURE

(a) Notice. In the event of a direct claim, the Indemnified Party shall deliver a written notice specifying: (i) the nature of the claim in reasonable detail; (ii) the specific provisions of this Agreement alleged to have been breached; and (iii) the estimated amount of Losses.

(b) Response. The Indemnifying Party shall respond within [____] business days, either accepting the claim (in whole or in part), rejecting the claim, or requesting additional information.

(c) Resolution. If the parties cannot resolve the direct claim within [____] business days, either party may pursue resolution through the dispute resolution mechanisms set forth in this Agreement.

PART IV: LIMITATION OF LIABILITY CLAUSES

4.1 Consequential Damages Exclusion

CLAUSE 4.1 — EXCLUSION OF CONSEQUENTIAL DAMAGES

EXCEPT FOR THE EXCLUDED CLAIMS SET FORTH IN SECTION 4.3 BELOW, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR TO ANY THIRD PARTY FOR ANY INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO LOSS OF PROFITS, LOSS OF REVENUE, LOSS OF BUSINESS OPPORTUNITIES, BUSINESS INTERRUPTION, LOSS OF DATA, LOSS OF GOODWILL, COST OF PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES, OR ANY OTHER SIMILAR DAMAGES, ARISING OUT OF OR RELATING TO THIS AGREEMENT, WHETHER BASED ON WARRANTY, CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, OR ANY OTHER LEGAL THEORY, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND EVEN IF A LIMITED REMEDY SET FORTH HEREIN IS FOUND TO HAVE FAILED OF ITS ESSENTIAL PURPOSE.

New York Practice Note: New York courts generally enforce consequential damages waivers in commercial contracts between sophisticated parties. Under N.Y. UCC § 2-719(3), limitation of consequential damages for personal injury in consumer goods cases is prima facie unconscionable. New York courts have held that parties to a commercial contract may agree to limit liability for consequential damages as part of an arm's-length negotiation (Metropolitan Life Ins. Co. v. Noble Lowndes International, Inc., 84 N.Y.2d 430 (1994)).

4.2 Cap on Aggregate Liability

CLAUSE 4.2 — AGGREGATE LIABILITY CAP

EXCEPT FOR THE EXCLUDED CLAIMS SET FORTH IN SECTION 4.3 BELOW, EACH PARTY'S TOTAL CUMULATIVE LIABILITY ARISING OUT OF OR RELATING TO THIS AGREEMENT, WHETHER BASED ON WARRANTY, CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, OR ANY OTHER LEGAL THEORY, SHALL NOT EXCEED:

☐ Option A (Fee-Based Cap): The aggregate amount of fees actually paid or payable by Customer to Provider during the [____]-month period immediately preceding the first event giving rise to such liability.

☐ Option B (Fixed-Dollar Cap): $[________________________________].

☐ Option C (Greater-Of Cap): The greater of (i) the aggregate amount of fees actually paid or payable by Customer to Provider during the [____]-month period immediately preceding the first event giving rise to such liability, or (ii) $[________________________________].

4.3 Carve-Outs from Liability Limitations

CLAUSE 4.3 — EXCLUDED CLAIMS

The limitations of liability set forth in Sections 4.1 and 4.2 shall not apply to (collectively, "Excluded Claims"):

(a) Either party's indemnification obligations for third-party intellectual property infringement claims;

(b) Either party's liability arising from gross negligence or willful misconduct;

(c) Either party's liability arising from a breach of its confidentiality obligations under this Agreement;

(d) Either party's liability arising from a data breach caused by such party's failure to maintain agreed-upon security controls;

(e) Customer's obligation to pay fees due and payable under this Agreement;

(f) Either party's liability arising from fraud or intentional misrepresentation; and

(g) Either party's liability arising from bodily injury, death, or damage to tangible property.

Optional Supercap for Excluded Claims:

☐ Notwithstanding the foregoing, each party's total cumulative liability for Excluded Claims shall not exceed [____] times the liability cap set forth in Section 4.2 (or $[________________________________], whichever is greater).

4.4 Enforceability Under New York Law

CLAUSE 4.4 — ENFORCEABILITY SAVINGS PROVISION

The parties acknowledge that the limitations of liability and exclusions of damages set forth in this Agreement reflect a fair and reasonable allocation of risk and are a material inducement for each party to enter into this Agreement. If any limitation or exclusion is found to be unenforceable under New York law, it shall be reformed to the minimum extent necessary to make it enforceable.

New York Enforceability Notes:

• New York courts enforce limitation of liability provisions between sophisticated commercial parties negotiating at arm's length, absent fraud, illegality, or unconscionability.
• Exculpatory clauses exempting parties from liability for grossly negligent or intentional conduct are generally unenforceable as against public policy.
• GOL § 5-321: Exculpatory clauses in leases exempting lessors from liability for negligence are void and unenforceable.
• New York follows a pure comparative negligence system (CPLR § 1411), where a plaintiff's damages are reduced by the percentage of fault attributable to the plaintiff, but recovery is not barred regardless of the degree of plaintiff's fault.
• CPLR Article 16: For non-economic loss in cases involving two or more tortfeasors, a defendant who is 50% or less at fault pays only its equitable share (several liability). A defendant who is more than 50% at fault is jointly and severally liable for non-economic damages.

PART V: ANTI-INDEMNITY CONSIDERATIONS

5.1 Construction Anti-Indemnity Statute (GOL § 5-322.1)

New York General Obligations Law § 5-322.1 is a broad anti-indemnity statute that renders void certain indemnification provisions in construction contracts.

Key provisions:

(a) Void provisions: A covenant, promise, agreement, or understanding in, or in connection with or collateral to, a contract or agreement relative to the construction, alteration, repair, or maintenance of a building, structure, appurtenances, and appliances (including moving, demolition, and excavating connected therewith) purporting to indemnify or hold harmless the promisee against liability for damage arising out of bodily injury to persons or damage to property contributed to, caused by, or resulting from the negligence of the promisee (whether such negligence be in whole or in part) is against public policy and is void and unenforceable.

(b) Permitted provisions: The statute does not preclude a promisee from requiring indemnification for damages arising out of bodily injury to persons or damage to property caused by or resulting from the negligence of a party other than the promisee, whether or not the promisor is partially negligent.

(c) Savings language: An indemnity clause can be preserved by inserting the phrase "to the fullest extent permitted by law" or similar savings language, which limits the indemnification to the indemnitor's own negligence and allows the clause to survive GOL § 5-322.1 scrutiny.

(d) Payment bonds: A covenant conditioning a subcontractor's or materialman's right to file a claim or commence an action on a payment bond on exhaustion of another legal remedy is void and unenforceable.

5.2 Exculpatory Clauses in Leases (GOL § 5-321)

GOL § 5-321 renders void and unenforceable every covenant, agreement, or understanding in or in connection with or collateral to any lease of real property exempting the lessor from liability for damages for injuries to person or property caused by or resulting from the negligence of the lessor, its agents, servants, or employees in the operation or maintenance of the demised premises or the real property containing the demised premises.

5.3 Workers' Compensation Grave Injury Limitation

N.Y. Workers' Compensation Law § 11 limits an employer's exposure to third-party indemnity and contribution claims. A third party seeking contribution or indemnity from an employer must establish that the employee sustained a "grave injury" as defined by the statute (e.g., loss of a limb, permanent brain damage, paraplegia, blindness, or death). Absent a grave injury, a third party cannot recover contribution or indemnity from the employer, even where a contractual indemnification agreement exists.

5.4 Construction Contract Indemnity Clause (GOL § 5-322.1-Compliant)

CLAUSE 5.4 — CONSTRUCTION INDEMNITY (COMPLIANT WITH GOL § 5-322.1)

To the fullest extent permitted by law, including but not limited to New York General Obligations Law § 5-322.1, Contractor shall indemnify, defend, and hold harmless Owner and its officers, directors, employees, and agents from and against any and all Losses arising out of or relating to:

(a) Bodily injury (including death) to any person;

(b) Damage to property (including loss of use thereof); or

(c) Any other loss, damage, or expense,

caused by or arising out of the negligent acts, errors, or omissions of Contractor, its subcontractors, agents, or employees in the performance of the Work, but not to the extent contributed to, caused by, or resulting from the negligence of Owner, its officers, directors, employees, or agents.

The phrase "to the fullest extent permitted by law" is specifically intended to limit this indemnification obligation to the maximum scope permitted by GOL § 5-322.1, and is not intended to require Contractor to indemnify Owner for Owner's negligence in any degree.

IMPORTANT: GOL § 5-322.1 renders void any provision purporting to indemnify or hold harmless the promisee against liability for damage caused by the promisee's negligence (whether in whole or in part). This clause is specifically drafted to avoid violating GOL § 5-322.1 by limiting indemnification to Losses caused by the Contractor's negligence, not Owner's negligence.

5.5 New York Labor Law Considerations

New York's Labor Law §§ 240(1) and 241(6) impose strict liability on owners and general contractors for certain gravity-related construction injuries and safety violations, respectively. These statutory obligations cannot be eliminated by indemnification or insurance provisions, and they create unique indemnification dynamics:

• Labor Law § 240(1) (Scaffold Law): Imposes absolute liability on owners and general contractors for gravity-related injuries. The owner or general contractor may seek contractual indemnification from the subcontractor whose employee was injured, provided the indemnification clause does not violate GOL § 5-322.1.
• Labor Law § 241(6): Imposes a non-delegable duty on owners and general contractors to comply with specific Industrial Code safety regulations. Violation of an applicable regulation creates liability.
• Contractual indemnification in Labor Law cases: The scope of indemnification for Labor Law claims depends on whether the owner's or general contractor's liability is purely vicarious (indemnification is available) or involves the owner's or general contractor's own negligence (limited by GOL § 5-322.1).

PART VI: INSURANCE REQUIREMENTS

6.1 General Insurance Requirements

CLAUSE 6.1 — INSURANCE REQUIREMENTS

[________________________________] ("Insured Party") shall, at its sole cost and expense, obtain and maintain throughout the term of this Agreement, and for a period of [____] years thereafter, the following insurance coverages with carriers authorized to do business in New York and rated no less than "A-" (VII) by A.M. Best Company:

(a) Commercial General Liability Insurance:

☐ Each-occurrence limit: $[________________________________]

☐ General aggregate limit: $[________________________________]

☐ Products-completed operations aggregate: $[________________________________]

☐ Personal and advertising injury: $[________________________________]

Coverage shall include premises-operations, products-completed operations, contractual liability, broad form property damage, and independent contractors.

(b) Professional Liability (Errors and Omissions) Insurance:

☐ Each-claim limit: $[________________________________]

☐ Annual aggregate limit: $[________________________________]

☐ Retroactive date: No later than [__/__/____]

(c) Workers' Compensation and Employers' Liability Insurance:

☐ Workers' Compensation: Statutory limits as required by the New York Workers' Compensation Law

☐ Employers' Liability:
- Each accident: $[________________________________]
- Disease — policy limit: $[________________________________]
- Disease — each employee: $[________________________________]

☐ New York Disability Benefits: Statutory limits as required by N.Y. Workers' Compensation Law Art. 9

☐ New York Paid Family Leave: As required by N.Y. Workers' Compensation Law Art. 9

(d) Commercial Automobile Liability Insurance:

☐ Combined single limit: $[________________________________]

Coverage shall include owned, hired, and non-owned vehicles.

(e) Umbrella/Excess Liability Insurance:

☐ Each-occurrence limit: $[________________________________]

☐ Annual aggregate limit: $[________________________________]

6.2 Additional Insured Requirements

CLAUSE 6.2 — ADDITIONAL INSURED

[________________________________] ("Additional Insured") shall be named as an additional insured on all commercial general liability, commercial automobile liability, and umbrella/excess liability insurance policies, using ISO Additional Insured endorsement CG 20 10 (or equivalent) for ongoing operations and CG 20 37 (or equivalent) for completed operations.

The additional insured coverage shall:

(a) Be primary and non-contributory with respect to any other insurance or self-insurance maintained by the Additional Insured;

(b) Apply on a per-project basis, where applicable;

(c) Include a waiver of subrogation in favor of the Additional Insured; and

(d) Not be limited by any limitation of liability set forth in this Agreement.

6.3 Waiver of Subrogation

CLAUSE 6.3 — WAIVER OF SUBROGATION

Each party shall cause its insurers to waive all rights of subrogation against the other party and its officers, directors, employees, and agents with respect to any claims covered by the insurance policies required under this Agreement.

6.4 Certificates of Insurance

CLAUSE 6.4 — CERTIFICATES AND EVIDENCE OF INSURANCE

[________________________________] shall deliver to [________________________________] certificates of insurance evidencing all required coverages prior to the commencement of any work or services, and annually thereafter upon renewal. Certificates shall:

(a) Identify the named insured, policy numbers, policy periods, and coverage limits;

(b) Confirm additional insured status, waiver of subrogation, and primary/non-contributory status;

(c) Provide that the insurer shall endeavor to provide [____] days' prior written notice to the certificate holder of any cancellation, non-renewal, or material change in coverage; and

(d) Be accompanied by copies of all required endorsements upon request.

PART VII: NEW YORK-SPECIFIC PRACTICE NOTES

7.1 Pure Comparative Negligence

New York follows a pure comparative negligence system under CPLR § 1411. A plaintiff's damages are diminished by the percentage of fault attributed to the plaintiff, but the plaintiff's recovery is not barred regardless of the degree of fault. This system affects risk allocation in indemnification provisions.

7.2 Joint and Several Liability (CPLR Article 16)

Under CPLR Article 16:

• Economic damages: Joint and several liability applies. Any defendant can be held liable for the full amount of economic damages.
• Non-economic damages: A defendant whose share of fault is 50% or less is liable only for its proportionate share of non-economic damages (several liability). A defendant whose fault exceeds 50% is jointly and severally liable for non-economic damages.
• This framework makes contractual indemnification particularly important in multi-party disputes.

7.3 Statute of Limitations Considerations

• Contract claims: Six (6) years (CPLR § 213(2))
• Tort claims (general): Three (3) years (CPLR § 214)
• Indemnity/contribution claims: Six (6) years from date of payment (CPLR § 213(2))
• Construction claims: Subject to CPLR § 214-d (accrual of contribution claims upon payment of underlying judgment or settlement)

7.4 Jury Waiver Enforceability

New York courts enforce pre-dispute jury waivers in commercial contracts if the waiver is knowing, voluntary, and intentional. The New York Constitution (Art. I, § 2) preserves the right to trial by jury. Practitioners should:

☐ Include conspicuous placement of the waiver (capitalized, bold, or separate acknowledgment)

☐ Ensure the waiver is mutual

☐ Ensure the waiver was a product of arm's-length negotiation between sophisticated parties

7.5 Drafting Checklist

☐ Verify that all construction contract indemnification provisions comply with GOL § 5-322.1

☐ Include "to the fullest extent permitted by law" savings language in construction indemnity clauses

☐ Account for New York Labor Law §§ 240(1) and 241(6) in construction-related indemnification

☐ Consider Workers' Compensation Law § 11 "grave injury" limitation on employer contribution/indemnity

☐ Verify that corporate indemnification provisions comply with BCL §§ 721 through 726

☐ Ensure the BCL § 721 floor limitations are respected (no indemnification for bad faith, active and deliberate dishonesty, or improper personal benefit)

☐ Verify that lease provisions do not violate GOL § 5-321 (no exculpation for lessor negligence)

☐ Ensure all indemnification provisions requiring indemnification for the indemnitee's own negligence use "unmistakable terms" per Gross v. Sweet

☐ Verify insurance requirements meet New York-specific mandates (Workers' Compensation, Disability Benefits, Paid Family Leave)

☐ Include appropriate survival provisions for post-termination indemnification obligations

☐ Ensure all optional provisions are appropriately selected and all bracketed fields are completed

SOURCES AND REFERENCES

1. N.Y. Bus. Corp. Law §§ 721-726 — Business Corporation Law, Directors and Officers (Indemnification)
   - https://www.nysenate.gov/legislation/laws/BSC/A7

2. BCL § 722 — Authorization for Indemnification
   - https://law.justia.com/codes/new-york/bsc/article-7/722/

3. GOL § 5-322.1 — Anti-Indemnity (Construction)
   - https://law.justia.com/codes/new-york/gob/article-5/title-3/5-322-1/

4. GOL § 5-321 — Exculpatory Clauses in Leases Void
   - https://law.justia.com/codes/new-york/gob/article-5/title-3/5-321/

5. N.Y. Workers' Compensation Law § 11 — Grave Injury Limitation
   - https://www.nysenate.gov/legislation/laws/WKC/11

6. CPLR § 1411 — Comparative Negligence
   - https://www.nysenate.gov/legislation/laws/CVP/1411

7. CPLR Article 16 — Joint and Several Liability
   - https://www.nysenate.gov/legislation/laws/CVP/A16

8. Gross v. Sweet, 49 N.Y.2d 102 (1980) — "Unmistakable terms" for indemnification of own negligence

9. Dole v. Dow Chemical Co., 30 N.Y.2d 143 (1972) — Common law contribution based on relative fault

This clause pack is provided for informational purposes only and does not constitute legal advice. It must be reviewed and customized by a qualified attorney licensed in New York before use. Laws change frequently; all citations should be verified against current statutes before relying on this document.

Prepared for use on the ezel.ai platform. For solo practitioners licensed in New York.