NJ: No Indemnification for Homeowners’ Association from Snow-Removal Contractor.

In the case of Franchini v. Beverly Hills Terrace Condominium Association, et al., the Appellate Division was faced with the question of whether a snow-removal contractor was responsible for indemnifying a homeowners’ association for the costs of defending a slip and call case instituted by a unit owner.  The relevant facts are as follows.

Franchini testified at trial that she was crossing a sidewalk at the homeowners’ association when she fell on an icy sidewalk. She claimed that defendant Greenview, the snow-removal contractor, was negligent in failing to inspect or maintain the sidewalk.  She also claimed that the Association was negligent in its conduct of the ownership and operation of the property.  After hearing all the evidence, the jury rendered a defense verdict in favor of both the Association and Greenview.  The Association then moved for  contractual indemnification from Greenview and sought reimbursement for all litigation costs incurred in defending plaintiff’s suit.

The indemnification clause that Greenview sought to enforce required Greenveiw to indemnify the Association for any damage or loss arising out of Greenview’s work. The trial court agreed that Franchini’s accident arose out of Greenview’s work and thus it awarded the Association defense costs.  Greenview appealed.

The Appellate Division first noted that the first step in interpreting a contractual indemnity provision is to determine the intent of the parties. The court noted that absent explicit contractual language, an indemnitee such as the Association may not recover for claims arising out of its own independent fault absent specific language to the contrary. The indemnification provision in this case stated that:

“It is the intent of the parties that the contractor’s indemnification and save harmless obligations hereunder are not contingent upon contractor’s fault.”

The Appellate Division found that this language could not be construed as an unequivocal statement by Greenview assuming indemnification for the Association’s own independent acts of negligence. It therefore reversed the trial court.

Special thanks to Andrew Marra for his contributions to this post.  For more information, please contact Bob Cosgrove at rcosgrove@wcmlaw.com.