New Jersey Statutes 27:1A-5.2. Indemnification of public contractors
Terms Used In New Jersey Statutes 27:1A-5.2
- Contract: A legal written agreement that becomes binding when signed.
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Fraud: Intentional deception resulting in injury to another.
- Indemnification: In general, a collateral contract or assurance under which one person agrees to secure another person against either anticipated financial losses or potential adverse legal consequences. Source: FDIC
- person: includes corporations, companies, associations, societies, firms, partnerships and joint stock companies as well as individuals, unless restricted by the context to an individual as distinguished from a corporate entity or specifically restricted to one or some of the above enumerated synonyms and, when used to designate the owner of property which may be the subject of an offense, includes this State, the United States, any other State of the United States as defined infra and any foreign country or government lawfully owning or possessing property within this State. See New Jersey Statutes 1:1-2
- State: extends to and includes any State, territory or possession of the United States, the District of Columbia and the Canal Zone. See New Jersey Statutes 1:1-2
- Tort: A civil wrong or breach of a duty to another person, as outlined by law. A very common tort is negligent operation of a motor vehicle that results in property damage and personal injury in an automobile accident.
The commissioner is authorized to enter into an agreement to defend and indemnify a person upon the terms and limitations the commissioner deems reasonable and appropriate. The commissioner shall not enter into an agreement after January 1, 1990 to provide legal defense and indemnification to any person pursuant to this section. The commissioner shall not agree to defend or indemnify any person for acts which arise from gross negligence, willful misconduct, fraud, intentional tort, bad faith or criminal wrongdoing or for claims for punitive or exemplary damages.
An agreement to defend and indemnify pursuant to this section does not bar, reduce, limit or affect any remedies which the department may have to enforce its contract or to assert a claim for damages to which the department may be entitled arising out of the person’s failure to perform the contract, or for the recovery of funds expended for the defense of a person if the defense was undertaken in response to a claim or cause of action brought against the person which is proven to have arisen from gross negligence, willful misconduct, fraud, intentional tort, bad faith, or criminal misconduct.
No one other than the person performing construction or services pursuant to a written contract with the department has the right to enforce any agreement for defense or indemnification between that person and the commissioner. For purposes of this section, the term “person” means public or private corporations, companies, associations, societies, firms, partnerships, joint stock companies, individuals, public authorities, the United States, the State of New Jersey and any of its political subdivisions or agents. The term “services” means work performed by design or other expert consultants and work or technical functions performed by nonexperts on projects for public works, building or improvements, including work preliminary to construction under a contract and work which results in or from a contract modification. The term “hazardous substances” shall have the same meaning as provided in section 3 of P.L. 1976, c. 141 (C. 58:10-23.11b).
L. 1986, c. 81, s. 1; amended 1987,c.417,s.1.