Hold Harmless Contract Template for England and Wales

A Hold Harmless Agreement is a contract where one party (the indemnifier) agrees to protect another party (the indemnitee) from potential legal claims, damages, or financial losses. Under the laws of England and Wales, these agreements work as risk management tools that allocate liability between parties across business and personal situations. The protective wording itself is often called a hold harmless clause, and a short standalone version addressed to one party is sometimes issued as a hold harmless letter.

What is a hold harmless agreement?

A hold harmless agreement shifts responsibility for specified risks from one party to another. In practice, the indemnitee agrees not to hold the other party liable for certain losses, and often the indemnifier agrees to cover claims that arise. The three common forms are a broad form (the indemnifier covers all liability, including the indemnitee's own negligence), an intermediate form (covering shared fault), and a limited form (the indemnifier covers only its own fault). Each form allocates risk differently, so the wording of the clause decides how much protection is actually provided.

Hold harmless agreement vs indemnity agreement. What is the difference?

In many contracts the two sit together as a hold harmless and indemnity clause, so the distinction is largely about emphasis rather than two separate documents.

When do you need this document?

You need a Hold Harmless Agreement when engaging in activities that could expose another party to legal liability. Common situations include:

• Contractors working on property where the company that owns it wants protection from third-party claims and property damage.
• Event organisers seeking protection from venue liability.
• Service providers shielding clients from potential damages.
• Property owners and landlords allocating risk for works carried out on their estate, a frequent use in real estate and construction deals.
• High-risk activities such as construction, infrastructure, and events management.

Hold harmless agreements in real estate and property

Property damage is one of the most common triggers for a hold harmless agreement. In real estate, a landlord, developer, or managing company often asks a contractor to hold it harmless for any damage to the building, its fixtures, or neighbouring property caused during works. The clause should name the property, describe the activities carried out there, and set out whether it covers damage to the owner's own property as well as third-party property. Where a visitor or tenant is injured on site, the agreement allocates responsibility between the company engaging the works and the party carrying them out, within the limits the law allows.

What should a hold harmless clause include?

A well-drafted hold harmless clause does several things. It identifies all parties involved, describes the activities or circumstances that trigger indemnification, sets the scope of what is covered and excluded, and establishes the duration of protection. It should also state whether protection is mutual or unilateral and whether the indemnifying party carries adequate insurance to honour the promise. Clear, express language is essential where the clause is intended to cover the indemnitee's own negligence, because courts read ambiguous wording narrowly.

A worked example

A tech services firm hires an independent IT consultant to install hardware at a client's office. The consultant signs a hold harmless agreement stating that they will hold the firm harmless from, and indemnify it against, any claim arising from the consultant's work on site, including property damage to the client's equipment or injury caused by the consultant's negligence. If a third party later brings a claim because a cable was left exposed, the clause directs that liability to the consultant rather than the firm, within the limits the agreement sets out. Liability that the law does not permit to be excluded, such as death or personal injury caused by negligence, stays outside the clause.

Key legal considerations

When drafting a Hold Harmless Agreement you should define the scope of indemnification precisely so the risks covered and excluded are clear. Consider mutual versus unilateral indemnification depending on your situation, and confirm the indemnifying party has the financial capacity or insurance to meet its obligations. Overly broad clauses may be unenforceable, particularly where they try to cover the indemnitee's own negligence without clear wording. The reasonableness of an exclusion is assessed under the Unfair Contract Terms Act 1977, and if one party is a consumer the Consumer Rights Act 2015 adds further protections. The agreement must also be supported by consideration to be binding.

Legal requirements in England and Wales

Under the laws of England and Wales, a Hold Harmless Agreement must comply with several pieces of legislation. The Unfair Contract Terms Act 1977 prohibits excluding liability for death or personal injury caused by negligence and requires other exclusion terms to be reasonable. If one party is a consumer, the Consumer Rights Act 2015 provides additional protections and may render certain terms unfair. The contract must satisfy the doctrine of consideration, so both parties must provide something of value. The Contracts (Rights of Third Parties) Act 1999 may apply where the agreement affects the rights of a party who has not signed it. Include a governing law clause specifying the laws of England and Wales and a clear dispute resolution mechanism, whether English court jurisdiction or arbitration.