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Amazi v. Atlantic Richfield Co.8/9/1991
in a contract to perform geophysical exploration bargained between the parties. It is not specifically a contract for insurance. We adopt the majority rule that absent an Appellant and Cross-Respondent.
express contractual term an indemnitee may not recover attorneys' fees incurred in establishing indemnity.
ARCO argues that Section IX, paragraph 3 of the agreement constitutes such an express term and allows recovery for fees incurred in establishing indemnity. The provision provides:
"If indemnity is required by any of the terms of this Agreement, the responsible party shall defend the other and pay all settlements, judgments, costs, including reasonable attorneys fees, and other related expenses similar or dissimilar to the foregoing." ARCO argues that such "related expenses" include attorneys' fees incurred in establishing its contractual right to indemnification, citing the rule that contracts for indemnification are to be liberally construed in favor of the party intended to be indemnified. See Capital Hill Shopping Center v. Miles (1977), 174 Mont. 222, 231, 570 P.2d 295, 298.
We disagree with this argument. While contracts of indemnity are to be liberally construed in favor of the indemnitee, the provision here is not in and of itself such a contract. Rather it is a contract term allowing for recovery of certain attorneys' fees. Under the majority rule just adopted, such a term must be express in order for an indemnitee to recover legal fees incurred in establishing its right to indemnification. We conclude that the provision here is not sufficiently express, and affirm the District Court's adoption of the majority rule regarding such fees.
The order of the District Court is
AFFIRMED.
CHIEF JUSTICE TURNAGE and JUSTICES HARRISON, GRAY and TRIEWEILER concur.
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