Also known as: indemnity doctrine · indemnity
Written by attorneys · grounded in primary & secondary sources — see below
A right entitling one tortfeasor who has discharged a common liability to recover full payment from another tortfeasor whose conduct caused the harm. The right arises when the second tortfeasor would otherwise be unjustly enriched by the first's payment. It is distinct from contribution because it shifts the entire loss rather than allocating shares.
Diego Duarte, an employee of Dover Bank, negligently caused a car accident while on bank business. The injured plaintiff sued both Diego and the bank. Dover Bank paid the full judgment. The bank then recovered the entire amount from Diego because the bank was liable only through his conduct.
Davenport Pharmaceuticals, a Delaware company, sold a product that injured a consumer in State X. After paying the judgment, Davenport sought indemnity from its foreign component supplier. The supplier challenged personal jurisdiction in State X, arguing that merely placing parts into commerce did not support jurisdiction over the indemnity claim.
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Damian Decker paid a judgment that compensated the victim for injuries caused by both his and Dorothy Daniels's conduct. Damian then demanded full reimbursement from Dorothy. The payment qualified as compensatory damages because it restored the victim for harm sustained.
Diamond Manufacturing paid the entire tort judgment arising from a joint project with Dillon Energy. Diamond then sought indemnity from Dillon under their agreement. Because Diamond held an indemnity right, Dillon could not pursue contribution against Diamond for any share of the payment.
Deanna Davenport directed her employee Dwight Dorsey to perform a task that injured a third party. Deanna paid the resulting judgment. Deanna recovered the full amount from Dwight because her liability arose solely from his conduct.
Diana Delgado's insurer paid a claim arising from a covered loss. The insurer then pursued the party whose negligence caused the loss. The payment triggered the insurer's right to recover the full amount from the responsible party.
Indemnity shifts the entire loss to one party when that party would otherwise be unjustly enriched. Contribution allocates loss according to equitable shares. When indemnity applies, contribution is unavailable.
Supporting sources
Indemnity arises when one party is liable only because of the conduct of another. The vicariously liable party who pays may recover the full amount from the actual wrongdoer.
Supporting sources
Yes. A principal who pays damages caused by an agent's breach of duty to a third party may obtain indemnity from the other principal whose breach produced the agent's conduct.
Supporting sources
…of their business. Issuing a policy of insurance is not a transaction of commerce. The policies are simple contracts of indemnity against loss by fire, entered into between the corporations and the assured, for a consideration paid by the latter. These contracts are not articles of commerce in any proper meaning of…