2010 California Code
Civil Code
Title 12. Indemnity

CIVIL CODE
SECTION 2772-2784.5



2772.  Indemnity is a contract by which one engages to save another
from a legal consequence of the conduct of one of the parties, or of
some other person.


2773.]  Section Twenty-seven Hundred and Seventy-three. An
agreement to indemnify a person against an act thereafter to be done,
is void, if the act be known by such person at the time of doing it
to be unlawful.


2774.  An agreement to indemnify a person against an act already
done, is valid, even though the act was known to be wrongful, unless
it was a felony.


2775.  An agreement to indemnify against the acts of a certain
person, applies not only to his acts and their consequences, but also
to those of his agents.


2776.  An agreement to indemnify several persons applies to each,
unless a contrary intention appears.



2777.  One who indemnifies another against an act to be done by the
latter, is liable jointly with the person indemnified, and
separately, to every person injured by such act.



2778.  In the interpretation of a contract of indemnity, the
following rules are to be applied, unless a contrary intention
appears:
   1. Upon an indemnity against liability, expressly, or in other
equivalent terms, the person indemnified is entitled to recover upon
becoming liable;
   2. Upon an indemnity against claims, or demands, or damages, or
costs, expressly, or in other equivalent terms, the person
indemnified is not entitled to recover without payment thereof;
   3. An indemnity against claims, or demands, or liability,
expressly, or in other equivalent terms, embraces the costs of
defense against such claims, demands, or liability incurred in good
faith, and in the exercise of a reasonable discretion;
   4. The person indemnifying is bound, on request of the person
indemnified, to defend actions or proceedings brought against the
latter in respect to the matters embraced by the indemnity, but the
person indemnified has the right to conduct such defenses, if he
chooses to do so;
   5. If, after request, the person indemnifying neglects to defend
the person indemnified, a recovery against the latter suffered by him
in good faith, is conclusive in his favor against the former;
   6. If the person indemnifying, whether he is a principal or a
surety in the agreement, has not reasonable notice of the action or
proceeding against the person indemnified, or is not allowed to
control its defense, judgment against the latter is only presumptive
evidence against the former;
   7. A stipulation that a judgment against the person indemnified
shall be conclusive upon the person indemnifying, is inapplicable if
he had a good defense upon the merits, which by want of ordinary care
he failed to establish in the action.



2779.  Where one, at the request of another, engages to answer in
damages, whether liquidated or unliquidated, for any violation of
duty on the part of the latter, he is entitled to be reimbursed in
the same manner as a surety, for whatever he may pay.




2782.  (a) Except as provided in Sections 2782.1, 2782.2, 2782.5,
and 2782.6, provisions, clauses, covenants, or agreements contained
in, collateral to, or affecting any construction contract and that
purport to indemnify the promisee against liability for damages for
death or bodily injury to persons, injury to property, or any other
loss, damage or expense arising from the sole negligence or willful
misconduct of the promisee or the promisee's agents, servants, or
independent contractors who are directly responsible to the promisee,
or for defects in design furnished by those persons, are against
public policy and are void and unenforceable; provided, however, that
this section shall not affect the validity of any insurance
contract, workers' compensation, or agreement issued by an admitted
insurer as defined by the Insurance Code.
   (b) Except as provided in Sections 2782.1, 2782.2, and 2782.5,
provisions, clauses, covenants, or agreements contained in,
collateral to, or affecting any construction contract with a public
agency that purport to impose on the contractor, or relieve the
public agency from, liability for the active negligence of the public
agency are void and unenforceable.
   (c) For all construction contracts, and amendments thereto,
entered into after January 1, 2009, for residential construction, as
used in Title 7 (commencing with Section 895) of Part 2 of Division
2, all provisions, clauses, covenants, and agreements contained in,
collateral to, or affecting any construction contract, and amendments
thereto, that purport to insure or indemnify, including the cost to
defend, the builder, as defined in Section 911, or the general
contractor or contractor not affiliated with the builder, as
described in subdivision (b) of Section 911, by a subcontractor
against liability for claims of construction defects are
unenforceable to the extent the claims arise out of, pertain to, or
relate to the negligence of the builder or contractor or the builder'
s or contractor's other agents, other servants, or other independent
contractors who are directly responsible to the builder, or for
defects in design furnished by those persons, or to the extent the
claims do not arise out of, pertain to, or relate to the scope of
work in the written agreement between the parties. This section shall
not be waived or modified by contractual agreement, act, or omission
of the parties. Contractual provisions, clauses, covenants, or
agreements not expressly prohibited herein are reserved to the
agreement of the parties. Nothing in this subdivision shall prevent
any party from exercising its rights under subdivision (a) of Section
910. This subdivision shall not affect the obligations of an
insurance carrier under the holding of Presley Homes, Inc. v.
American States Insurance Company (2001) 90 Cal.App.4th 571. Nor
shall this subdivision affect the obligations of a builder or
subcontractor pursuant to Title 7 (commencing with Section 895) of
Part 2 of Division 2.
   (d) Subdivision (c) does not prohibit a subcontractor and builder
or general contractor from mutually agreeing to the timing or
immediacy of the defense and provisions for reimbursement of defense
fees and costs, so long as that agreement does not waive or modify
the provisions of subdivision (c) subject, however, to paragraphs (1)
and (2). A subcontractor shall owe no defense or indemnity
obligation to a builder or general contractor for a construction
defect claim unless and until the builder or general contractor
provides a written tender of the claim, or portion thereof, to the
subcontractor which includes all of the information provided to the
builder or general contractor by the claimant or claimants,
including, but not limited to, information provided pursuant to
subdivision (a) of Section 910, relating to claims caused by that
subcontractor's scope of work. This written tender shall have the
same force and effect as a notice of commencement of a legal
proceeding. If a builder or general contractor tenders a claim for
construction defects, or a portion thereof, to a subcontractor in the
manner specified by this provision, the subcontractor shall elect to
perform either of the following, the performance of which shall be
deemed to satisfy the subcontractor's defense obligation to the
builder or general contractor:
   (1) Defend the claim with counsel of its choice, and the
subcontractor shall maintain control of the defense for any claim or
portion of claim to which the defense obligation applies. If a
subcontractor elects to defend under this paragraph, the
subcontractor shall provide written notice of the election to the
builder or general contractor within a reasonable time period
following receipt of the written tender, and in no event later than
90 days following that receipt. Consistent with subdivision (c), the
defense by the subcontractor shall be a complete defense of the
builder or general contractor of all claims or portions thereof to
the extent alleged to be caused by the subcontractor, including any
vicarious liability claims against the builder or general contractor
resulting from the subcontractor's scope of work, but not including
claims resulting from the scope of work, actions, or omissions of the
builder, general contractor, or any other party. Any vicarious
liability imposed upon a builder or general contractor for claims
caused by the subcontractor electing to defend under this paragraph
shall be directly enforceable against the subcontractor by the
builder, general contractor, or claimant.
   (2) Pay, within 30 days of receipt of an invoice from the builder
or general contractor, no more than a reasonable allocated share of
the builder's or general contractor's defense fees and costs, on an
ongoing basis during the pendency of the claim, subject to
reallocation consistent with subdivision (c), and including any
amounts reallocated upon final resolution of the claim, either by
settlement or judgment. The builder or general contractor shall
allocate a share to itself to the extent a claim or claims are
alleged to be caused by its work, actions, or omissions, and a share
to each subcontractor to the extent a claim or claims are alleged to
be caused by the subcontractor's work, actions, or omissions,
regardless of whether the builder or general contractor actually
tenders the claim to any particular subcontractor, and regardless of
whether that subcontractor is participating in the defense. Any
amounts not collected from any particular subcontractor may not be
collected from any other subcontractor.
   (e) Notwithstanding any other provision of law, if a subcontractor
fails to timely and adequately perform its obligations under
paragraph (1) of subdivision (d), the builder or general contractor
shall have the right to pursue a claim against the subcontractor for
any resulting compensatory damages, consequential damages, and
reasonable attorney's fees. If a subcontractor fails to timely
perform its obligations under paragraph (2) of subdivision (d), the
builder or general contractor shall have the right to pursue a claim
against the subcontractor for any resulting compensatory and
consequential damages, as well as for interest on defense and
indemnity costs, from the date incurred, at the rate set forth in
subdivision (g) of Section 3260, and for the builder's or general
contractor's reasonable attorney's fees incurred to recover these
amounts. The builder or general contractor shall bear the burden of
proof to establish both the subcontractor's failure to perform under
either paragraph (1) or (2) of subdivision (d) and any resulting
damages. If, upon request by a subcontractor, a builder or general
contractor does not reallocate defense fees to subcontractors within
30 days following final resolution of the claim as described above,
the subcontractor shall have the right to pursue a claim against the
builder or general contractor for any resulting compensatory and
consequential damages, as well as for interest on the fees, from the
date of final resolution of the claim, at the rate set forth in
subdivision (g) of Section 3260, and the subcontractor's reasonable
attorney's fees incurred in connection therewith. The subcontractor
shall bear the burden of proof to establish both the failure to
reallocate the fees and any resulting damages. Nothing in this
section shall prohibit the parties from mutually agreeing to
reasonable contractual provisions for damages if any party fails to
elect for or perform its obligations as stated in this section.
   (f) A builder, general contractor, or subcontractor shall have the
right to seek equitable indemnity for any claim governed by this
section.
   (g) Nothing in this section limits, restricts, or prohibits the
right of a builder, general contractor, or subcontractor to seek
equitable indemnity against any supplier, design professional, or
product manufacturer.
   (h) As used in this section, "construction defect" means a
violation of the standards set forth in Sections 896 and 897.



2782.1.  Nothing contained in Section 2782 shall prevent a
contractor responsible for the performance of a construction
contract, as defined in Section 2783, from indemnifying fully a
person, firm, corporation, state or other agency for whose account
the construction contract is not being performed but who, as an
accommodation, enters into an agreement with the contractor
permitting such contractor to enter upon or adjacent to its property
for the purpose of performing such construction contract for others.



2782.2.  (a) Nothing contained in subdivision (a) of Section 2782
prevents an agreement to indemnify a professional engineer against
liability for the negligence of the engineer, or the engineer's
agents or employees, in providing inspection services to plants or
other facilities if all the following criteria are satisfied:
   (1) The promisor is the owner of the plants or facilities
inspected.
   (2) The promisor is audited annually by an independent certified
public accountant, public accountant, or accounting licentiate of
another state authorized by the laws of that state to perform the
audit.
   (3) The net worth of the promisor exceeds ten million dollars
($10,000,000), as determined by the promisor's most recent annual
independent audit. The requirement of this paragraph shall be
satisfied at the time the contract for indemnification is entered,
and a subsequent reduction of the promisor's net worth shall not void
the obligation to indemnify.
   (4) The promisor is self-insured with respect to liability arising
from ownership of the plant or facility.
   (5) The indemnification shall not be applicable to the first two
hundred fifty thousand dollars ($250,000) of liability.
   (b) Subdivision (a) does not authorize contracts for
indemnification of liability arising from willful misconduct.



2782.5.  Nothing contained in Section 2782 shall prevent a party to
a construction contract and the owner or other party for whose
account the construction contract is being performed from negotiating
and expressly agreeing with respect to the allocation, release,
liquidation, exclusion, or limitation as between the parties of any
liability (a) for design defects, or (b) of the promisee to the
promisor arising out of or relating to the construction contract.



2782.6.  (a) Nothing in subdivision (a) of Section 2782 prevents an
agreement to indemnify a professional engineer or geologist or the
agents, servants, independent contractors, subsidiaries, or employees
of that engineer or geologist from liability as described in Section
2782 in providing hazardous materials identification, evaluation,
preliminary assessment, design, remediation services, or other
services of the types described in Sections 25322 and 25323 of the
Health and Safety Code or the federal National Oil and Hazardous
Substances Pollution Contingency Plan (40 C.F.R. Sec. 300.1 et seq.),
if all of the following criteria are satisfied:
   (1) The services in whole or in part address subterranean
contamination or other concealed conditions caused by the hazardous
materials.
   (2) The promisor is responsible, or potentially responsible, for
all or part of the contamination.
   (b) The indemnification described in this section is valid only
for damages arising from, or related to, subterranean contamination
or concealed conditions, and is not applicable to the first two
hundred fifty thousand dollars ($250,000) of liability or such
greater amount as is agreed by the parties.
   (c) This section does not authorize contracts for indemnification,
by promisors specified in paragraph (2) of subdivision (a), of any
liability of a promisee arising from the gross negligence or willful
misconduct of the promisee.
   (d) "Hazardous materials," as used in this section, means any
hazardous or toxic substance, material, or waste which is or becomes
subject to regulation as such by any agency of the state, any
municipality or political subdivision of the state, or the United
States. "Hazardous materials" includes, but is not limited to, any
material or substance that is any of the following:
   (1) A hazardous substance, as defined in Section 25316 of the
Health and Safety Code.
   (2) Hazardous material, as defined in subdivision (j) of Section
25501 of the Health and Safety Code.
   (3) Acutely hazardous material, as defined in subdivision (a) of
Section 25532 of the Health and Safety Code.
   (4) Hazardous waste, as defined in Section 25117 of the Health and
Safety Code.
   (5) Extremely hazardous waste, as defined in Section 25115 of the
Health and Safety Code.
   (6) Petroleum.
   (7) Asbestos.
   (8) Designated as a hazardous substance for purposes of Section
311 of the Federal Water Pollution Control Act, as amended (33 U.S.C.
Sec. 1321).
   (9) Hazardous waste, as defined by subsection (5) of Section 1004
of the federal Resource Conservation and Recovery Act of 1976, as
amended (42 U.S.C. Sec. 6903).
   (10) A hazardous substance, as defined by subsection (14) of
Section 101 of the federal Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended (42 U.S.C. Sec.
9601).
   (11) A regulated substance, as defined by subsection (2) of
Section 9001 of the federal Solid Waste Disposal Act, as amended (42
U.S.C. Sec. 6991).
   (e) Nothing in this section shall be construed to alter, modify,
or otherwise affect the liability of the promisor or promisee, under
an indemnity agreement meeting the criteria of this section, to third
parties for damages for death or bodily injury to persons, injury to
property, or any other loss, damage, or expense.
   (f) This section does not apply to public entities, as defined by
Section 811.2 of the Government Code.


2782.8.  (a) For all contracts, and amendments thereto, entered into
on or after January 1, 2007, with a public agency for design
professional services, all provisions, clauses, covenants, and
agreements contained in, collateral to, or affecting any such
contract, and amendments thereto, that purport to indemnify,
including the duty and the cost to defend, the public agency by a
design professional against liability for claims against the public
agency, are unenforceable, except for claims that arise out of,
pertain to, or relate to the negligence, recklessness, or willful
misconduct of the design professional. The duty to indemnify,
including the duty and the cost to defend, is limited as provided in
this section. This section shall not be waived or modified by
contractual agreement, act, or omission of the parties. Contractual
provisions, clauses, covenants, or agreements not expressly
prohibited herein are reserved to the agreement of the parties.
   (b) All contracts and all solicitation documents, including
requests for proposal, invitations for bid, and other solicitation
documents, between a public agency and a design professional, are
deemed to incorporate by reference the provisions of this section.
   (c) For purposes of this section, the following definitions apply:
   (1) "Public agency" includes any county, city, city and county,
district, school district, public authority, municipal corporation,
or other political subdivision, joint powers authority, or public
corporation in the state. Public agency does not include the State of
California.
   (2) "Design professional" includes all of the following:
   (A) An individual licensed as an architect pursuant to Chapter 3
(commencing with Section 5500) of Division 3 of the Business and
Professions Code, and a business entity offering architectural
services in accordance with that chapter.
   (B) An individual licensed as a landscape architect pursuant to
Chapter 3.5 (commencing with Section 5615) of Division 3 of the
Business and Professions Code, and a business entity offering
landscape architectural services in accordance with that chapter.
   (C) An individual registered as a professional engineer pursuant
to Chapter 7 (commencing with Section 6700) of Division 3 of the
Business and Professions Code, and a business entity offering
professional engineering services in accordance with that chapter.
   (D) An individual licensed as a professional land surveyor
pursuant to Chapter 15 (commencing with Section 8700) of Division 3
of the Business and Professions Code, and a business entity offering
professional land surveying services in accordance with that chapter.
   (d) This section shall only apply to a professional service
contract, or any amendment thereto, entered into on or after January
1, 2007.
   (e) The amendments made to this section by the act adding this
subdivision shall apply to services offered pursuant to a design
professional contract, or any amendment thereto, entered into on or
after January 1, 2011.
   (f) Nothing in this section shall abrogate the provisions of
Section 1104 of the Public Contract Code.



2782.9.  (a) All contracts, provisions, clauses, amendments, or
agreements contained therein entered into after January 1, 2009, for
a residential construction project on which a wrap-up insurance
policy, as defined in subdivision (b) of Section 11751.82 of the
Insurance Code, or other consolidated insurance program, is
applicable, that require an enrolled and participating subcontractor
or other participant to indemnify, hold harmless, or defend another
for any claim or action covered by that program, arising out of that
project are unenforceable.
   (b) To the extent any contractual provision is deemed
unenforceable pursuant to this section, any party may pursue an
equitable indemnity claim against another party for a claim or action
unless there is coverage for the claim or action under the wrap-up
policy or policies. Nothing in this section shall prohibit a builder
or general contractor from requiring a reasonably allocated
contribution from a subcontractor or other participant to the
self-insured retention or deductible required under the wrap-up
policy or other consolidated insurance program, if the maximum amount
and method of collection of the participant's contribution is
disclosed in the contract with the participant and the contribution
is reasonably limited so that each participant may have some
financial obligation in the event of a claim alleged to be caused by
that participant's scope of work. The contribution shall only be
collected when and as any such self-insured retention or deductible
is incurred by the builder or general contractor and in an amount
that bears a reasonable and proportionate relationship to the alleged
liability arising from the claim or claims alleged to be caused by
the participant's scope of work, when viewed in the context of the
entirety of the alleged claim or claims. Any contribution shall only
be collected from a participant after written notice to the
participant of the amount of and basis for the contribution. In no
event shall the total amount of contributions collected from
participants exceed the amount of any self-insured retention or
deductible due and payable by the builder or general contractor for
the claim or claims. However, this requirement does not prohibit any
legally permissible recovery of costs and legal fees to collect a
participant's contribution if the contribution satisfies the
requirements of this subdivision and is not paid by the participant
when due.
   (c) This section shall not be waived or modified by contractual
agreement, act, or omission of the parties.



2782.95.  For any wrap-up insurance policy or other consolidated
insurance program that insures a private residential (as that term is
used in Title 7 (commencing with Section 895) of Part 2 of Division
2) work of improvement that first commences construction after
January 1, 2009, the following shall apply:
   (a) The owner, builder, or general contractor obtaining the
wrap-up insurance policy or other consolidated insurance program
shall disclose the total amount or method of calculation of any
credit or compensation for premium required from a subcontractor or
other participant for that wrap-up policy in the contract documents.
   (b) The contract documents shall disclose, if and to the extent
known:
   (1) The policy limits.
   (2) The scope of policy coverage.
   (3) The policy term.
   (4) The basis upon which the deductible or occurrence is triggered
by the insurance carrier.
   (5) If the policy covers more than one work of improvement, the
number of units, if any, indicated on the application for the
insurance policy.
   (6) A good faith estimate of the amount of available limits
remaining under the policy as of a date indicated in the disclosure
obtained from the insurer.
   (7) Disclosures made pursuant to paragraphs (5) and (6) are
recognized to be based upon information at a given moment in time and
may not accurately reflect the actual number of units covered by the
policy nor the amount of insurance available, if any, when a later
claim is made. These disclosures are presumptively made in good faith
if the disclosure pursuant to paragraph (5) is the same as that
contained in the application to the wrap-up insurer and the
disclosure pursuant to paragraph (6) was obtained from the wrap-up
insurer or broker. The presumptions stated above shall be overcome
only by a showing that the insurer, broker, builder, or general
contractor intentionally misrepresented the facts identified in
paragraphs (5) or (6).
   (c) Upon the written request of any participant, a copy of the
insurance policy shall be provided, if available, that shows the
coverage terms and items in paragraphs (1) to (4), inclusive, of
subdivision (b) above. If the policy is not available at the time of
the request, a copy of the insurance binder or declaration of
coverage may be provided in lieu of the actual policy. Paragraphs (1)
to (4), inclusive, of subdivision (b) may be satisfied by providing
the participant with a copy of the binder or declaration. Any party
receiving a copy of the policy, binder, or declaration shall not
disclose it to third parties other than the participant's insurance
broker or attorney unless required to do so by law. The participant's
insurance broker or attorney may not disclose the policy, binder, or
declaration to any third party unless required to do so by law.
   (d) If the owner, builder, or general contractor obtaining the
wrap-up insurance policy or other consolidated insurance program does
not disclose the total amount or method of calculation of the
premium credit or compensation to be charged to the participant prior
to the time the participant submits its bid, the participant shall
not be legally bound by the bid unless that participant has the right
to increase the bid up to the amount equal to the difference between
the amount the participant included, if any, for insurance in the
original bid and the amount of the actual bid credit required by the
owner, builder, or general contractor obtaining the wrap-up insurance
policy or other consolidated insurance program. This subdivision
shall not apply if the owner, builder, or general contractor
obtaining the wrap-up insurance policy or other consolidated
insurance program did not require the subcontractor to offset the
original bid amount with a deduction for the wrap-up insurance policy
or program.


2782.96.  If an owner, builder, or general contractor obtains a
wrap-up insurance policy or other consolidated insurance program for
a public work as defined in Section 1720 of the Labor Code or any
other project other than residential construction, as that term is
used in Title 7 (commencing with Section 895) of Part 2 of Division
2, that is put out for bid after January 1, 2009, the following shall
apply:
   (a) The total amount or method of calculation of any credit or
compensation for premium required from a subcontractor or other
participant for that policy shall be clearly delineated in the bid
documents.
   (b) The named insured, to the extent known, shall disclose to the
subcontractor or other participant in the contract documents the
policy limits, known exclusions, and the length of time the policy is
intended to remain in effect. In addition, upon written request,
once available, the named insured shall provide copies of insurance
policies to all those who are covered by the policy. Until such time
as the policies are available, the named insured may also satisfy the
disclosure requirements of this subdivision by providing the
subcontractor or other participant with a copy of the insurance
binder or declaration of coverage. Any party receiving a copy of the
policy, binder, or declaration shall not disclose it to third parties
other than the participant's insurance broker or attorney unless
required to do so by law. The participant's insurance broker or
attorney may not disclose the policy, binder, or declaration to any
third party unless required to do so by law.
   (c) The disclosure requirements in subdivisions (a) and (b) do not
apply to an insurance policy purchased by an owner, builder, or
general contractor that provides additional coverage beyond what was
contained in the original wrap-up policy or other consolidated
insurance program if no credit or compensation for premium is
required of the subcontractor for the additional insurance policy.



2783.  As used in Sections 2782 and 2782.5, "construction contract"
is defined as any agreement or understanding, written or oral,
respecting the construction, surveying, design, specifications,
alteration, repair, improvement, maintenance, removal of or
demolition of any building, highway, road, parking facility, bridge,
railroad, airport, pier or dock, excavation or other structure,
development or other improvement to real or personal property, or an
agreement to perform any portion thereof or any act collateral
thereto, or to perform any service reasonably related thereto,
including, but not limited to, the erection of all structures or
performance of work in connection therewith, the rental of all
equipment, all incidental transportation, crane and rigging service
and other goods and services furnished in connection therewith.



2784.  As used in Sections 2782 and 2782.5, a "design defect" is
defined as a condition arising out of its design which renders a
structure, item of equipment or machinery or any other similar
object, movable or immovable, when constructed substantially in
accordance with its design, inherently unfit, either wholly or in
part, for its intended use or which impairs or renders the use of
such structure, equipment, machinery or property dangerous.



2784.5.  Any provision, promise, agreement, clause, or covenant
contained in, collateral to, or affecting any hauling, trucking, or
cartage contract or agreement is against public policy, void and
unenforceable if it purports to indemnify the promisee against
liability for any of the following damages which are caused by the
sole negligence or willful misconduct of the promisee, agents,
servants, or the independent contractors directly responsible to the
promisee, except when such agents, servants, or independent
contractors are under the direct supervision and control of the
promisor:
   (a) Damages arising out of bodily injury or death to persons.
   (b) Damage to property.
   (c) Any other damage or expense arising under either (a) or (b).
   This section shall not affect the validity of any insurance
contract, workmen's compensation insurance contract, or agreement
issued by an admitted insurer as defined by Sections 23 and 24 of the
Insurance Code or insurance effected by surplus line brokers under
Sections 1760 through 1780 of the Insurance Code.



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