- Length:2 pages (250 words)
- Available in:Microsoft Word DOCXApple PagesRTF
If the document isn’t right for your circumstances for any reason, just tell us and we’ll refund you in full immediately.
We avoid legal terminology unless necessary. Plain English makes our documents easy to understand, easy to edit and more likely to be accepted.
You don’t need legal knowledge to use our documents. We explain what to edit and how in the guidance notes included at the end of the document.
We offer free support by email in respect of editing the document. You can also use our Document Review Service if you want to our legal team to check that the document will do as you intend.
Our documents comply with the latest relevant law. Our lawyers regularly review how new law affects each document in our library.
About this document
This is a very short, professionally drawn agreement to enable a guarantor to impose a legal obligation on the person he has guaranteed. It can be used between private individuals or companies.
This indemnity agreement does not protect the guarantor form his guarantee in any way. It simply gives him a hard, legal basis for suing the person or company he has guaranteed if his guarantee is called by the party protected by the guarantee.
It can be used in any circumstances of a guarantee, but will be most useful in a company situation, where a director has guaranteed a debt or obligation of his company. If the company were to collapse and the guarantee called, the director could at least use this agreement to claim against the company as an unsecured creditor.
Company director A enters into hire purchase agreement by his company to buy Porsche car for himself. Director B signs the personal guarantee but does not realise that A has intentionally no also signed it. B discovers the position and insists that A signs to an indemnity agreement so that it is he makes good to B if the finance company should call on the guarantee.
Company group in reconstruction: subsidiary XYZ is to be sold. Buyer concerned at level of debt in XYZ. Seller agrees to indemnify buyer if XYZ fails to be able to meet its obligations due in next 12 months. Note that this is a more efficient way to deal with the circumstances than for the seller to agree to guarantee the debts because, first, the dubious solvency of XYZ will remain unknown to a creditor and second, because if the indemnity is called, the cash will go to the buyer and not to XYZ.
The law in this document
There is no modern statute law relating to indemnities. This document is based on contract common law.
Net Lawman offers other related document templates related to new guarantees at Guarantees and Indemnities.