Under Construction - June 2013: Nevada Indemnification Clauses and Additional Insured Endorsements

by Snell & Wilmer

Unlike many states, Nevada has no statutory prohibition on indemnification agreements within the construction context. This has been an issue of significant concern every legislative session since 1995, with 2013 being no exception. See AB367, 77th Legislative Session (2013).[1] In general, Nevada courts will enforce any type of indemnification provision, so long as it is specifically drafted in a manner to convey plainly the intent of the parties and the limit, if any, of the indemnitor’s responsibilities. Divisions within the Nevada Construction Industry have so far thwarted nearly every attempt at reform.

As a result, most recent changes in Nevada’s indemnity law have come from the Nevada Supreme Court, usually in the context of residential construction defect litigation. It appears the Nevada Supreme Court is reacting with some concern to the situation where a subcontractor who is otherwise without liability for actual performed defective work is nevertheless assessed portions of the developer’s costs of defense and damages. The Court has recently exacted a more stringent and specific language obligation on the indemnified party, and has emphasized the need for an indemnitor to have notice of its obligation at the time of agreement. In 2010, the Court disallowed third party indemnification for an actor’s sole negligence by general, “catch-all” type language, and required instead “an express or explicit reference to the indemnitee’s own negligence” in the indemnity provision. Brown v. Star Ins. Co., 237 P.3d 92, 97 (Nev. 2010). This express language requirement was extended to type 2 indemnification provisions (which requires full indemnification even though the indemnitee had contributory negligence liability with the indemnitor) in 2011 in the case of Rayburn Lawn & Landscape v. Plaster Dev. Co., Inc., 255 P.3d 268 (Nev. 2011). Still further, the Court refused to allow any indemnification by a landowner against its consultant arising out of claims against a landowner under the Americans with Disabilities Act of 1990 (“ADA”), even though the  ADA consultant was specifically hired to ensure the landowner’s ADA compliance. The Court held that federal law had completely preempted state law in the ADA context. See Rolf Jensen & Assc., Inc. v. Dist. Ct., 128 Nev.Adv.Op. 42 (2012).

This focus on express and explicit language has also found its way into the concept of the obligation of Defense, separate and apart from Indemnity obligations. In United Rentals Highway Tech., Inc. v. Wells Cargo, Inc., 128 Nev.Adv.Op. 59 (2012), the Nevada Supreme Court held that the obligation language to indemnify and defend an indemnitee from damage claims “to the extent caused” by the indemnitor, including the obligation of naming the indemnitee an additional insured on the indemnitor’s insurance policy, was insufficient to impose an obligation of either indemnity or defense absent a showing that the indemnitor was a proximate cause of the injury. The clause was strictly construed. The Court noted that “accordingly, unless specifically otherwise stated in the indemnify clause, an indemnitor’s duty to defend … is limited to those claims directly attributed to the indemnitor’s scope of work and does not include defending against claims arising from the indemnitee’s own negligence.” United, Id., at 16. The Court held that the indemnitee was not entitled to indemnity and was not entitled to be covered by the insurance coverage under the indemnitor’s policy, even though the indemnitee was named an additional insured.

It remains a divisive issue in Nevada’s construction industry that indemnity and defense clauses are broadly enforceable, and will continue to impair the ability to pass substantive legislative issues until resolved. It’s time for the industry to collectively address indemnification and defense obligations among its members, so that a compromise solution can be found.

[1] http://leg.state.nv.us/Session/77th2013/Reports/history.cfm?ID=829

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Snell & Wilmer | Attorney Advertising

Written by:

Snell & Wilmer

Snell & Wilmer on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.