The indemnification clause someone just invoked against you.

An indemnification tender is a demand that you pay someone else’s liability, their defense costs, or both, under a clause in a contract you signed. In New York that clause is construed strictly and read as written. The gap between what the letter demands and what the clause says is where the defense lives.

What does it mean when someone invokes an indemnification clause against you?

Invoking an indemnification clause means one contracting party is demanding that the other absorb a loss — a lawsuit, a judgment, a settlement, or defense costs. The demand is a contract claim whose entire strength comes from the sentence the parties wrote. New York courts enforce that sentence as written, and no further.

Three promises travel together: defend, indemnify, and hold harmless. To defend is to fund the defense now. To indemnify is to reimburse an established loss. “Hold harmless” is often drafted as a promise not to pursue you at all, though New York courts frequently read “indemnify and hold harmless” as a single obligation. The text decides, not the labels.

That matters immediately. A commercial indemnitor is not an insurance company, and where the indemnitor is not an insurer, its duty to defend is no broader than its duty to indemnify, unless the clause separately and expressly promises a defense. A tender demanding that you take over the defense today, before anyone has decided whether the claim falls inside the clause, may be asking for more than the clause gives.

Case: Bellefleur v Newark Beth Israel Med. Ctr., 66 AD3d 807 (2d Dept 2009).

Does an indemnification clause cover the other side’s attorney fees in a lawsuit between the two of you?

New York follows the American rule: each party pays its own attorney fees unless a statute, a court rule, or the parties’ agreement says otherwise. An indemnification clause shifts fees between the contracting parties only where that intent is unmistakably clear from the language of the promise. Generic wording mentioning counsel fees reaches third-party claims.

That is the holding of Hooper. A purchaser sued its computer system supplier and demanded its own fees under an indemnity article that expressly mentioned reasonable counsel fees. The Court of Appeals read the rest of the article: prompt notice of claims, indemnitor control of the defense, no settlement without consent. Those mechanics are exclusively referable to claims brought by outsiders. The purchaser’s fees in its own suit were not recoverable.

Case: Hooper Assoc. v AGS Computers, 74 NY2d 487 (1989).

Apply that to the letter on your desk. If the tender demands the fees your counterparty is spending to sue you, find the words that say so: claims “between the parties,” fees “in enforcing this agreement,” a prevailing-party provision. A clause reciting notice, tender of defense, and settlement consent is describing somebody else’s lawsuit.

A clause that tells you who must notify whom, who may control the defense, and who must consent to a settlement is not talking about a fight between the two signatories. That is the tell.

How strictly do New York courts read an indemnification clause?

Indemnification clauses are construed strictly. A promise to indemnify is not found unless it can be clearly implied from the language and purpose of the entire agreement and the surrounding circumstances. Where the clause is said to cover the indemnitee’s own negligence, the contract must evince an unmistakable intent. Broad, sweeping language alone does not carry the burden.

Strict construction does not mean magic words. A clause covering any and all claims for injury caused by or happening in connection with the premises was held to show unmistakable intent, and the Court of Appeals refused to require that the indemnitee’s active negligence be recited by name. Two limits. It predates the construction statute below, and sweeping language satisfies that test only when the agreement as a whole points the same way.

Case: Levine v Shell Oil Co., 28 NY2d 205 (1971); Great N. Ins. Co. v Interior Constr. Corp., 7 NY3d 412 (2006).

A statutory override swallows many tenders. In contracts relative to the construction, alteration, repair, or maintenance of a building or structure, a promise to indemnify the promisee against liability for bodily injury or property damage caused by the promisee’s own negligence, in whole or in part, is void. If your subcontract is read to make you pay for the general contractor’s own fault, that reading is unenforceable. The statute does not reach an ordinary services or supply contract, bar indemnity for damage caused by someone other than the promisee, or invalidate insurance.

Law: General Obligations Law 5-322.1. Case: Itri Brick & Concrete Corp. v Aetna Cas. & Sur. Co., 89 NY2d 786 (1997).

Drafters answered with five words: “to the fullest extent permitted by law.” The Court of Appeals held that the phrase limits rather than expands the promisor’s obligation, so a clause containing it is not void. The subcontractor indemnifies only for the share attributable to it, even where the general contractor was partly negligent. Partial indemnification survives. Full indemnification for the promisee’s own negligence does not.

Case: Brooks v Judlau Contr., Inc., 11 NY3d 204 (2008).

What is the difference between contractual and common-law indemnification?

Contractual indemnification arises from a clause the parties wrote. Common-law indemnification arises from the law itself and shifts an entire loss to the party at fault when the party seeking it was held liable without fault of its own. The two are proven differently, and one fails the moment the claimant’s own negligence appears.

Common-law indemnification requires the party seeking it to prove that it was not negligent, and that the proposed indemnitor was negligent in a way that contributed to the injury or, absent negligence, had authority to direct, supervise, and control the work. A party whose own fault remains in the case cannot establish that yet, so conditional relief is the most it can get.

Case: Bellefleur v Newark Beth Israel Med. Ctr., 66 AD3d 807 (2d Dept 2009).

What makes a tender letter effective, and what happens if the notice was defective?

A tender is the formal demand that you accept the defense, the liability, or both. Whether notice is required, in what form, within what time, and to which address is answered by the contract. The indemnity clause and the notice clause are read together, because the promise is measured from the purpose of the entire agreement.

Audit the letter before answering, in this order.

• Identify the operative contract by name and date. The 2022 master services agreement. The subcontract. Never a bare “the agreement,” because a tender can be built on the wrong one.
• Confirm the sender is a person the clause protects. Indemnified parties are a defined list, and affiliates, lenders, and successors are either in it or they are not.
• Read the trigger. “Arising out of the Services” is narrower than “relating in any way to this Agreement.” Compare it word for word against the underlying complaint.
• Check the notice mechanics. Whether a defect defeats the tender turns on whether the contract makes notice a condition precedent. Absent that, expect a fight about prejudice, not forfeiture.
• Separate the insurance promise from the indemnity promise. A covenant to name an additional insured is a different obligation. Answer them separately.
• Read the settlement and defense-control terms first. Where the clause conditions indemnity on consent, settling without it can forfeit the claim.

I read the indemnification clause and the notice provision before I read the tender letter. I ask for the signed contract with every exhibit and amendment before I ask anyone what happened.

Then respond in writing. Silence is not a strategy. A denial that states its textual basis and reserves all rights preserves your position without conceding that the clause applies.

Can they demand indemnification before they have paid anything?

An indemnification claim ordinarily does not accrue until the party seeking indemnity has suffered the loss by paying it. That is the accrual rule the Court of Appeals applies for limitations purposes, and a free-standing indemnity suit filed before any payment is anticipatory. The six-year contract period runs from that accrual, not from the original breach.

Case: McDermott v City of New York, 50 NY2d 211 (1980); Bay Ridge Air Rights v State of New York, 44 NY2d 49 (1978). Law: CPLR 213(2).

Two qualifications keep that rule from being a trump card. The text can move the date: a promise to indemnify against liability can be triggered when liability is fixed rather than paid. And inside a pending action, indemnity relief is routinely granted conditionally, before payment.

Third-party practice is the other answer. Inside an existing action, a defendant may bring in a person who is or may be liable for the plaintiff’s claim. That conditional phrasing lets an indemnity claim be tried alongside the main case. Whether the timing objection helps you depends on whether the claim arrived as a separate suit or as a third-party complaint.

Law: CPLR 1007(a).

How does an indemnity claim get attached to the lawsuit you are already in?

CPLR 1007 lets a defendant file a third-party summons and complaint against a non-party who is or may be liable for all or part of the plaintiff’s claim. That is how an indemnification demand becomes live litigation. In actions governed by the AVOID Act amendment, third-party practice runs on a clock that starts when the answer is served.

For actions commenced on or after April 18, 2026, a defendant may not file a third-party summons and complaint more than ninety days after serving its answer without an order of the court, and none may be filed after the note of issue unless upon good cause shown or in the interest of justice. A filing made in violation is severed or dismissed without prejudice, and which of the two is the court’s call. Service must follow within twenty days of filing, not the one hundred twenty days CPLR 306-b allows for ordinary process. Actions commenced earlier are not governed by the deadlines.

The amendment carries an express carve-out. Notwithstanding both deadlines, a defendant or third-party defendant may implead the plaintiff’s employer without a court order within ninety days after the later of learning the employer’s identity or knowing, or having reason to know, that the plaintiff sustained a grave injury as Workers’ Compensation Law 11 uses that term. If a severed third-party action is refiled, consolidation is barred.

Law: CPLR 1007(b)-(f), as amended by L 2025, ch 704 (the AVOID Act) and its chapter amendment, effective April 18, 2026; Workers’ Compensation Law 11.

Two consequences follow. If you hold an indemnity right against a vendor or subcontractor, tender and impleader become a first-month decision, not a post-deposition one. If you are the one impleaded, check the third-party complaint’s filing date against the answer date.

Regardless of the amendment, the court may dismiss a third-party complaint without prejudice, order a separate trial, or make such other order as may be just, considering whether the third-party controversy will unduly delay the main action or prejudice substantial rights.

Law: CPLR 1010.

Dismissal without prejudice is not absolution. It is relocation. The indemnity claim survives, in a different courtroom, on a different calendar, funded by somebody.

What should you do in the first week after the tender arrives?

The first week after an indemnification tender is about preserving options, not resolving the dispute. Deadlines get calendared, documents get gathered, insurers get notified, and the clause gets compared word by word against the underlying pleading. Nothing gets conceded in writing, and nothing gets ignored.

• Calendar every date on the face of the papers. If a summons and complaint came with the tender, that response deadline governs everything else.
• Pull the executed contract with every amendment, exhibit, and incorporated work order. Incorporation clauses decide which terms apply.
• Determine whether the contract is one relative to construction, alteration, repair, or maintenance of a building or structure. If it is, the statutory limit and any “fullest extent permitted by law” language are in play.
• Notify your own carriers in writing, promptly, with the tender and any pleading.
• Respond in writing on stated grounds, reserving all rights, within any contractual response period.
• Decide whether you have your own indemnity right to tender upstream or downstream, and, if the amended statute governs, whether impleader must happen inside the ninety-day window that runs from service of your answer.
• Suspend routine deletion of email, texts, and project files touching the underlying events.

An indemnification tender arrives written in absolutes. It is not one. It is a sentence in a document, measured against a complaint, under a rule of strict construction. Read the clause first.