AI Overview...
- Indemnity Cannot Be Invoked for Losses Caused by Third Party -
Main points and insights: - An indemnity clause is not necessarily conditional solely because it employs the words indemnify the losses, especially when the guarantee is an unconditional, unequivocal, and irrevocable bank guarantee (Ref Larsen & Toubro Limited, a Company VS Shree Ahuja Properties & Realtors Private Limited - Bombay).
- The liability under such guarantees is not an indemnity but a bank guarantee, which can be invoked unconditionally by the beneficiary without the need to establish third-party fault (Ref Larsen & Toubro Limited, a Company VS Shree Ahuja Properties & Realtors Private Limited - Bombay).
- Claims for indemnity are subject to specific conditions and limitations, such as time limitations or the nature of the loss, and cannot be invoked for third-party losses unless explicitly stated (Ref Borosil Glass Works Limited VS Tata Motors Limited - Bombay, Mula Sahakari Sakhar Karkhana Ltd. VS State Bank of India - Bombay).
- In cases involving third-party liabilities, indemnity cannot be claimed unless the agreement explicitly provides for it, and the nature of the document (e.g., a tripartite agreement vs. indemnity contract) is crucial (Ref Mula Sahakari Sakhar Karkhana Ltd. VS State Bank of India - Bombay, m. t. ARCTIC FLOWER and others VS Star Ship Management Ltd. - Bombay).
- The liability of a third party (like an owner or insurer) is distinct from indemnity obligations, which typically involve one party compensating another for specific losses, not third-party damages (Ref S. JAYARAM SHETTY VS NATIONAL INSURANCE CO. LTD. - Karnataka, G. Swaminathan and another VS Banumathi and another - Madras).
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Courts have clarified that indemnity cannot be enforced through admiralty jurisdiction unless explicitly framed as such, and claims are generally not enforceable unless they are for direct indemnity obligations (Ref m. t. ARCTIC FLOWER and others VS Star Ship Management Ltd. - Bombay).
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Analysis and Conclusion:
Indemnity clauses generally do not extend to losses caused by third parties unless explicitly included in the contractual language. Most legal provisions and court rulings emphasize that indemnity is a contractual obligation between the parties involved and does not automatically cover third-party damages. Bank guarantees and similar instruments are not indemnities but are unconditional payment guarantees, which can be invoked independently of third-party fault. Therefore, losses caused solely by third parties typically cannot be claimed under indemnity clauses unless the contract explicitly states otherwise.
Search Results for "Indemnity Cannot be Invioked for Losses Caused by Third Party"
2017 0 Supreme(Bom) 357 • India - Bombay
S.C.DHARMADHIKARI, B.P.COLABAWALLA
for losses - It cannot be said to be conditional merely because one sentence of clause 3.1 employ the words “indemnify the losses ... ” - Merely because it seeks to indemnify the losses under the contract and the first respondent has to raise a demand by alleging ... beneficiary has an unfettered right to invoke it - This is an unconditional, unequivocal and irrevocable bank guarantee - It is not an indemnity ... It is not an indemnity for ....
2015 0 Supreme(Bom) 45 • India - Bombay
R.D.DHANUKA
Claim for creation of fund under indemnity clause barred by limitation and not maintainable under the said clause. ... Under clause 14 of the agreement, the lessor was entitled to indemnity on happening of certain eventualities set out therein. ... The cause of action for the claim for creation of fund arose when the Deputy Commissioner of Income Tax disallowed the claim for ... His indemnity is complete. He cannot pick up the burthen of which the land is relieved and seize it as his own property. ... a....
2005 0 Supreme(Bom) 974 • India - Bombay
R.M.S.KHANDEPARKAR, ANOOP V.MOHTA
The recital in the preamble in question itself cannot be the foundation to interpret the document in question as a document of indemnity ... this document is nothing, but a contract of indemnity. ... The words "indemnity" and "indemnification" have been used in the preamble, based upon which, the respondent sought to contend that ... Pentagon was not a necessary party. The document Exhibit-46, is not an independent contract like a contract of indemnity. It is a tripartite agreement. As....
1994 0 Supreme(Mad) 695 • India - Madras
S.SUBRAHMANIA AYYAR
It was further held that in the case of a promissory note, the liability is always on the maker and he cannot claim indemnity or contribution from any other person. ... But, if he loses in the contest, his remedy would be to proceed against A under the indemnity. ... Before a third party Notice could issue, it is necessary to see whether the defendant is entitled to an indemnity or contribution from a third party." ... I am also aw....
2002 0 Supreme(Kar) 292 • India - Karnataka
D.V.SHYLENDRA KUMAR, T.S.THAKUR
court analyzes the provisions of the Motor Vehicles Act, 1988, particularly Chapter XI, and concludes that the owner of the vehicle cannot ... be considered a third party within the meaning of the Act. ... the term 'third party' in the context of a claim petition filed by the owner of a vehicle involved in an accident. ... The factum of the victim of a motor vehicle accident having suffered bodily injury and loss in itself are to be taken as the cause to make the owners liable to compe....
2010 6 Supreme 129 • India - Supreme Court
R.V.RAVEENDRAN, H.L.GOKHALE
nbsp; (b) Contract – Clause 17.3 – It is confined only to the necessary and reasonable extra cost, caused ... pay the tax – If there was no change of law, this situation would not have arisen at all – This payment of tax amount therefore cannot ... a finding which is not only against the weight of evidence but altogether against the evidence – Instantly, the umpire’s award cannot ... Clause 17.3 thereof does not deal with any such losses. It makes a provision for compensation in the event of the appellant being subjected....
2017 0 Supreme(Bom) 14 • India - Bombay
S.J.KATHAWALLA
Properties any sum or sums not exceeding the total sum of Rs. 10 crores as may be claimed by Ahuja Properties from L & T as its losses ... Whether Ahuja Properties was required to establish before PNB the damage or loss caused to it for the alleged default on the part ... The court held that Ahuja Properties was not required to establish before PNB the damage or loss caused to it for the alleged default ... Such being the bargain entered into between PNB and Ahuja Properties at the instance of L & T, L &T cannot be heard....
1998 0 Supreme(Bom) 812 • India - Bombay
B.P.SARAF, R.J.KOCHAR
The admiralty jurisdiction cannot be invoked to enforce an indemnity. ... Maintainability in admiralty jurisdiction-Admiralty jurisdiction cannot be invoked to enforce an indemnity Held, since claims found ... -Admittedly, in the plaints, there is not even a mention of indemnity. The suit is not to enforce indemnity. ... The admiralty jurisdiction cannot be invoked to enforce an indemnity. It is c....
2015 0 Supreme(Mad) 1955 • India - Madras
R.MAHADEVAN
company, would be sold to first respondent and a first Share Purchase Agreement (SPA) was entered - After completion, 1st Respondent caused ... Applicant has established a prima facie case - It is also evident that balance of convenience and irreparable injustice would be caused ... mind - This Court is prima facie satisfied that respondents have not acted in good faith and that irretrievable injustice would be caused ... Indemnity:- ... 15.1 Indemnity:- ... The Vendors shall indemnify....
2013 0 Supreme(Bom) 1295 • India - Bombay
R.D.DHANUKA
party and hold the Lessor harmless, against all losses, damages, claims, penalties, expenses, suits, or proceedings of whatsoever ... nature made, suffered or incurred consequent thereupon and for this purpose take out such workmen’s compensation third party insurance ... Clause 14 The Lessee shall indemnify and keep indemnified the Lessor, at all times, against any loss or seizure of the Equipment ... "Contract of indemnity" defined: ... A contract by which one party#HL_END....
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