Follow-on question - NCHRP Martha M. Taylor 14 May 1997 13:28 EST
A couple of weeks ago, I posted a request for information from recipients of agreements from NCHRP. I am now asking more specifically for advice and guidance (from anyone). The exact language (barring typos) that NCHRP requires us to agree to is: "(a) The parties agree that the contractor and its employees, agents, subcontractors, and subgrantees (hereinafter referred to collectively as "Contractor") will be primarily responsible for performing the work required under the contract, and shall therefore be legally responsible for and obligated to pay all claims arising out of contractor's negligent or wrongful acts in performing such work, including all claims for bodily injury (including death), personal injury, property damage, and other losses, liabilities, costs and expenses (including but not limited to attorneys fees) asserted against the Academy, its committee members, officers, employees, and agents, by any third parties, whether or not represented by a final judgment, where such claims arise out of any negligent or wrongful act of Contractor. (b) The term "wrongful act" as used herein shall mean any actual or alleged negligent breach of duty or other tortious act or omission; willful malfeasance; failure to comply with Federal or state governmental requirements; copyright or patent infringement; or any actual or alleged false or misleading statement or omission made by Contractor in its proposal to the Academy or in any written deliverable required under the contract. (c) The obligations in paragraph (a) of this clause shall not extend to claims, damages, losses, liabilities, costs, and expenses to the extent they arise out of the negligent acts or omissions of the Academy, its committee members, officers, employees, and agents in making a material alteration to a report or other written deliverable required under the contract where such material alteration is made without the consent of Contractor." (d) Both the Academy and Contractor shall give prompt notice to each other upon learning of the assertion of any claim or the commencement of any action or proceeding, in respect of which a claim under this paragraph may be sought, specifying, if known, the facts pertaining thereto and an estimate of the amount of the liability arising therefrom, but no failure to give such notice shall relieve the Academy or contractor of any liability hereunder except to the extent actual prejudice is suffered thereby. (e) The Academy and Contractor agree to cooperate in the defense of any claim, action, or legal proceeding brought against the Academy, although the Academy shall be primarily responsible for, and shall control, any such defense. The Academy shall have the option to permit Contractor or its insurance carrier to assume the defense of any such claims, except that, unless agreed to in advance by the Academy in writing, contractor shall not have the right to select counsel for, assume the defense of, or to approve the settlement of, any claim, action, or legal proceeding brought against the Academy." (Personal note - we have no control, we just have to pay for it.) It doesn't get any better from here forward and survives termination/expiration of the agreement. Someone please tell me that I am over-reacting to this language. I have two agreements of extreme importance to the institution sitting and awaiting a decision about the institution's willingness to accept this risk. The work is not particularly risky but the consequences of a tort claim in this state makes defense an expensive proposition even if the judgment is in our favor. We are not able to find anyone to insure us for the work and I do not honestly believe there is a single public institution out there that has patent infringement indemnification insurance. I need some help from my fellow NCHRP recipients. Please explain how you are able to accept such horrendous terms and also whether or not you are willing to address this issue as a group with NCHRP to get the terms relaxed in the interest of promoting good science without punishing good scientists. I have so far heard from only one institution since my last request about this issue. I contacted three others by telephone at the request of one of our faculty members. One has agreed to accept the risk, one has refused to work with NCHRP, one has not returned my phone call, and one is in the same boat as we are trying to decide what in the world we can do to satisfy the sponsoring agency without risking the farm. Thanks in advance for any information you might provide. ---------------------------------------------------------- Martha M. Taylor, Director (334) 844-4438 Contracts and Grants Administration FAX (334) 844-5953 307 Samford Hall Auburn University, AL 36849-5131 xxxxxx@mail.auburn.edu