Hold harmless

The Jolly Contrarian’s Glossary The snippy guide to financial services lingo.™ Go Premium Index — Click the ᐅ to expand: Glossary Comments? Questions? Suggestions? Requests? Insults? We’d love to 📧 hear from you. Sign up for our newsletter.

hold harmless
/həʊld/ /ˈhɑːmlɪs/ (n.)
pl: holds harmless

Under a hold harmless, one party agrees not to sue the other for losses it incurs in performing the contract.

It is thus a slightly odd undertaking, because as a general proposition, a contracting party would not be liable for losses the other suffers unless they are caused by its breach of contract — that is, a hold harmless isolates a party from a liability it shouldn’t have under a contract in the first place. It may operate to shut down an argument based on an implied term, or prevent a claim in tort arising from faithful performance of the contract that somehow breaches a non-contractual duty of care to the other party (don’t get me started on concurrent liability).

The paradigm case is the parking building that asks its customers to hold it harmless for damage or theft to their vehicles while parked in the parking building.

Not to be confused with an indemnity

A hold harmless is subtly different from an indemnity - it’s more like a beneficent inversion of one.

Odd spot

The plural form of “hold harmless” is “holds harmless”. Like “attorneys general”. Because “hold harmlesses” sounds stupid, and “harmless” is an adjective. And yes, I did just make that up.

See also

• Columbina Cavalier, Defence Against Indemnities teacher at St. Crustard’s School for the Perpetually Pedantic in the Opco Boone stories.