Earlier this May, we wrote about how the Alabama Supreme Court held that “hold harmless” and “indemnify” may be considered synonyms, even if the terms appear separately in a contract.
The court’s decision in Adams v. Atkinson, No. SC-2024-0528, 2025 WL 1416851 (Ala. May 16, 2025),was an important precedent at the time, as it suggested that a “hold harmless” clause could impose a duty of indemnity even if the term “indemnity” was not explicitly mentioned. The court emphasized the context-specific nature of its decision, suggesting that the parties to the trust agreement in Adams intended the hold harmless provision to operate as a reimbursement mechanism rather than merely a waiver of rights.
However, on September 19, 2025, the Alabama Supreme Court withdrew its opinion in Adams. This withdrawal was based on the ground that the beneficiary to the trust agreement at issue “waived her right to challenge the unaddressed arguments of the defendants that could have supported the circuit court’s judgment of dismissal” because she “did not address in her initial brief on original submission all the defendants’ arguments raised in their motion to dismiss.”
This is an important development because parties who want a “hold harmless” provision to act only as a waiver of rights, rather than as a duty to indemnify, may now argue that Adams has no precedential value. On the other hand, the Alabama Supreme Court could revisit its original reasoning in Adams in a future case, and that reasoning might still influence how similar disputes are decided.
Given these developments, parties should carefully consider the specific language used in indemnity and hold harmless clauses to ensure their intentions are clearly reflected.
If you have any questions on drafting indemnity clauses or have a dispute featuring an indemnity clause, please contact Chris Selman or Zachary Stewart.