Undefined Work, Unenforceable Indemnity: First Department Clarifies Limits of "Arising Out Of" Clauses
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Legal Development 02 November 2026 02 November 2026
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North America
The Appellate Division, First Department, has just clarified that a subcontractor will not be required to indemnify a general contractor or owner of a project under construction—even with an extremely broad "arising out of the work" indemnity trigger, and despite plaintiff working for that subcontractor at the time of the accident—when the scope of work was "not defined nor understood by the parties in the oral agreement." Juarez v. Avacon Mgt. LLC, 2026 WL 2832206 (1st Dep't Sept. 22, 2026).
In Juarez, the testimony of the parties established that the general contractor and subcontractor "orally negotiated the terms" of the subcontractor's work at the premises. Later, they entered into a written rider agreement where the subcontractor agreed to indemnify the general contractor for injuries "arising out of resulting from the work covered by" the previous oral agreement between them.
Importantly, the general contractor testified that the scope of the subcontractor's work was "never defined" by the parties. The subcontractor also denied that it was hired to perform the demolition work the plaintiff was performing at the time of the accident.
Thus, "the parties never reached a meeting of the minds as to the project's scope of work," and the unmistakable intent to indemnify must be "contemplated within the scope of the indemnitor's work", relying on the Court of Appeals massive decision in Dibrino v. Rockefeller Ctr. N., Inc., 2025 WL 3670593 (2025).
"The projects scope of work was a material term in the parties’ agreement because the riders indemnification provision expressly stated that [the subcontractor] would indemnify and hold [the general contractor] harmless 'against all liability or claimed liability for bodily injury or death to any person(s) ... arising out of or resulting from the Work covered by this Contract Agreement.'"
Read the court’s decision and order: Juarez v. Avacon Mgt. LLC, 2026 WL 2832206 (1st Dep't Sept. 22, 2026)
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