You Win...and Lose
Yet another reminder that the best indemnity clause in the world won't necessarily protect you from a defunct - even shady -- obligor. Here, the seller promised to indemnify the buyer for cleanup costs associated with arsenic pollution on a parcel on the Everett waterfront. The buyer sued and won a judgment of $600,000 against the corporate obligor. The court then refused to pierce the corporate veil, leaving the buyer without any recourse. This is why bonds, personal guarantees and even set-asides are used to back up indemnity promises.
