12 Advoc. Q. 35 (1990-1991)
The Enforceability of Indemnity Clauses by Negligent Parties

handle is hein.journals/aqrty12 and id is 51 raw text is: THE ENFORCEABILITY OF INDEMNITY CLAUSES BY
NEGLIGENT PARTIES
John D. Liddle*
The common law courts have shown a great reluctance to allow
the enforceability of an indemnity clause where the party seeking
to rely on the clause has been found negligent. One commentator
has observed that there exists a strong presumption that a party
is not entitled to be indemnified against liability resulting from his
own negligence.' Where such a clause may be poorly drafted or
is ambiguous, it is not surprising that no effect is given to it; but
in borderline or even clearly drafted cases, the courts have employed
a sometimes curious mix ofjudicial construction and legal fictions
to render the clause ineffectual.
The earliest and highest Canadian authority on the subject is the
Supreme Court of Canada decision of Toronto (City) v. Lambert,2
in which the husband of the plaintiff was killed in an industrial
accident. At trial, both defendants, a utilities company and the city,
were found negligent. The decision was affirmed on appeal, and
the city appealed to the Supreme Court. At issue was whether an
agreement between the city and the utilities company operated so
as to indemnify the city. The relevant provision covered an exhaust-
ing array of contingencies:
The company shall save harmless and indemnify said corporation against
any action, claim, suit or demand brought or made by the granting of any of
the privileges hereinbefore mentioned to the company, and all costs and expenses
incurred thereby, and also against all loss, damages, costs, charges and expenses
of every nature and kind whatsoever, which the corporation may incur, be put
to or have to pay, by reason of the improper or imperfect execution of their
works or any of them, or by reason of the said works becoming unsafe or out
of repair, or by reason of the neglect, failure or omission of the company to
do or permit anything therein agreed to be done or permitted, or by reason
of any act, default or omission of the company or otherwise howsoever.
* Of Borden & Elliot, Toronto.
The Law of Guarantee, Kevin McGuiness (Toronto, Carswell, 1986), at para. 11:13.
2 (1916), 33 D.L.R. 476, [1916154 S.C.R. 200

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