“Balancing Optimism With Pragmatism: Allocating Risk in Construction Contracts,” Construction Executive
ATLANTA (April 13,2018) --- In an article published on April 13, 2018, in Construction Executive, Weinberg Wheeler Hudgins Gunn & Dial partners Ross Ginsberg and Matthew Marrone provide insight into ways that construction companies can allocate risk at the front end of a business relationship in order to minimize risk later. Ginsberg and Marrone discuss how liability plays into a contract writing, “A limitation of liability provision caps the maximum amount of damages for which a party can be liable for any type of dispute, under any theory of recovery (tort, contract, statutory). Unlike a waiver of consequential damages, a limitation of liability provision is not limited as to the ‘type’ of damages to be capped.” They also explain that the most common method of allocating risk is to include an indemnification or “hold harmless” provision. “The purpose of an indemnification provision is to shift the risk of loss from one party to another,” they write. “These provisions typically include language that requires one party (the ‘indemnitor’) to pay for the damages incurred by another party (the ‘indemnitee’) arising from a negligent act or omission (the ‘duty to indemnify’).”
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