A Mistake You Don’t Want to Make in Your Agreements
It is not uncommon for a company in the business of supplying concrete to use a pumper so that its concrete can get from the truck to the actual pour site. This happens most often when the concrete truck can’t drive close enough to where the concrete is needed.
Agreement with Unenforceable Provision
In one such instance, a concrete company rented a pumper and was using it at a job site when a construction worker was struck and injured by the pumper’s hose. Claims were filed against both the concrete company and the rental company that supplied the pumper. The rental company settled but then sought to recover from the concrete company what it paid out. How could it do that? It relied on the language in its rental agreement with the concrete company. That agreement included an indemnification clause, indemnifying the rental company from claims associated with the use of the pumper.
The concrete company resisted, something the rental company thought was foolish given the language within its rental agreement. But to the rental company’s surprise, the indemnity provision in its rental agreement was found to be unenforceable. It didn’t contain a dollar limit as to the concrete company’s potential liability, and without that limitation, this indemnification was considered too vague by the judge and wouldn’t be enforced.
A good result for the concrete company and a good lesson for all construction companies relying on agreements which may not have been reviewed by their construction lawyer. Not all those indemnification provisions are automatically enforceable.