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Legal Advice

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  1. #1

    Legal Advice

    Hi there,

    Is there any legal expert could help me to explain the following sentences in a simple words? and what's the Companies in clause a (highlighted in red) referring to?

    Many thanks.

    ================================================== ====

    10. (a) ABC Co agrees to indemnify and hold harmless DEF Consultant from and against any and all losses, claims, damages, liabilities and expenses (including reasonable fees and disbursements of counsel) insofar as such losses, claims, damages, liabilities or expenses (or actions, claims, investigations or proceedings in respect thereof) arise out of or are related to DEF Consultant’s activities in his capacity as a director, officer or committee member of the Companies, except to the extent that any such loss, claim, damage, liability or expense is determined by a final, non-appealable judgment of a court of competent jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of DEF Consultant.

    (b) DEF Consultant shall advise ABC Co immediately of any action, suit, judgment, investigation, or proceeding of any kind whatsoever outstanding, pending, or threatened against or affecting ABC Co or any of its directors or officers in their capacity as such at law or in equity before or by any governmental department commission, board, bureau or agency of any kind whatsoever in any jurisdiction whatsoever whether or not there is a legitimate basis therefor with respect to which DEF Consultant seeks indemnification.


  2. #2

    Join Date
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    That all looks pretty straightforward and understandable to me as written (I am not a lawyer). "Companies" will have been defined earlier in the document.

    Sent from my HTC Desire S using GeoClicks Mobile


  3. #3

    Join Date
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    a) ABC protects DEF from any losses except if a court says that DEF acted completely stupid

    b) Once he gets to know about it, DEF needs to tell ABC immediately if he wants to be protected

    Companies should be in the Definitions part of the contract


  4. #4

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    Companies would have been defined in the "definition" part of the contract..Just look for its definition.


  5. #5

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    What is a defined term?


  6. #6

    There's definition about the "Companies" in the contract. From a native English reader, will Companies refer to ABC company & its affiliated company OR DEF Consultant and its company? or something else? The person who drafted us the contract resigned & left HK, so I can't really contact with him at the moment.

    Is it ok to delete the whole clauses from the contract? what's the consequences without these two Clauses?


  7. #7

    Join Date
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    Quote Originally Posted by hummingbirds:
    There's definition about the "Companies" in the contract. From a native English reader, will Companies refer to ABC company & its affiliated company OR DEF Consultant and its company? or something else? The person who drafted us the contract resigned & left HK, so I can't really contact with him at the moment.

    Is it ok to delete the whole clauses from the contract? what's the consequences without these two Clauses?
    Companies means whatever has been defined.

    As for the last paragraph - get some legal advice, bit hard to tell you without reviewing the whole contract.
    hummingbirds likes this.

  8. #8

    Thank you for all replies. Appreciated !


  9. #9

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    In general, the purpose of the second paragraph is to protect the indemnifying party, because if you're giving an indemnity to someone you want to know ASAP when the potential claim arises so that you can deal with it--not months down the road when it's too late to effectively contest it. So, if you're being forced to give an indemnity (the first paragraph), you'd want to keep the second paragraph. Whether you can delete the indemnity in its entirety is a "commercial" matter--depends on the strength of your bargaining position vs the other party. Some companies (banks, especially) simply refuse to give indemnities at all, which essentially forces the other party to either absorb the risk or pay for the relevant insurance--it's a cost-shifting exercise, mainly.

    hummingbirds likes this.

  10. #10

    Thank you Lootoo!