Equitable Indemnity In Washington State
Posted Mar 6, 2019
By Washington State Business & Real Estate Lawyer William O. Kessler
What is Equitable Indemnity?
Sometimes a party’s wrongful act or omission causes the wronged party to enter litigation with an unrelated third party. The common law theory of equitable indemnity says that the separate third party may be entitled to compensation from the initial wrongdoer as an element of damages. In Washington, this rule is also known as the “ABC Rule”: When A wrongs B, causing B to litigate with C, B may be entitled to a judgment for money damages and attorney fees from A.
How is it applied?
For example, Barry buys a house and hires Alex as his realtor in the transaction. Alex fails to read the title report and does not realize the house has a large easement recorded against it. Charles, a neighbor not involved in the purchase, claims the easement benefits him. Barry is forced to sue Charles to try to eliminate the easement. Under equitable indemnity, Alex is liable to Barry for Barry’s attorney fees litigating against Charles, in addition to any reduction in value if the court finds the easement is enforceable against Barry. Equity principles allow the court to compel Alex to indemnify — compensate for harm or loss — innocent parties like Barry.
At Beresford Booth our lawyers hold decades of experience in a wide range of matters including those involving equitable indemnities. We would be pleased to sit down and help you in any and all of your legal matters.
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