Standard form construction contracts contain indemnities.  For example, the FIDIC standard forms of contract contain indemnities in relation to loss arising from death, personal injury and damage to property.  Often other indemnities are agreed by the parties during negotiations.  But what is special about an indemnity clause?

An indemnity provision in a construction contract compensates one party when the other party does the thing that triggers the application of the indemnity.  For example, an indemnity could provide that A will indemnify B against any loss suffered by B if A breaches its contract with B.

So the answer to what is special about an indemnity clause is "nothing".  Qatari law will, generally, treat a claim under an indemnity the same as any other claim for breach of contract.  This means that the damages that can be recovered under Qatari law where an indemnity is triggered are the same as those that can be claimed for the same event if it was simply expressed as a normal obligation of the contract without the indemnity wording.

What including indemnity wording does do is draw the parties attention to the possibility of breach, prompting them to think about and manage up front such matters which may otherwise need unravelling in a dispute following breach, such as: what triggers the application of the indemnity; for what losses will B be compensated; how much compensation will be paid and how must party B conduct itself in relation to the events that have triggered the indemnity?

In an indemnity clauses the trigger for the application of the indemnity should be clear.  In the simple example above, party B will only want to indemnify party A for material breach - and not just any minor or trivial breach.  This should be stated.

Both a contractor and an employer may wish to cap their liability under a construction contract (including the indemnities) to a particular amount and/or to particular losses.  It is not unusual to exclude indirect losses (and some of the FIDIC contracts do this) and Qatari law allows for this (other than in the case of  fraud or gross mistake).  Losses that would generally be recoverable under Qatari law include direct and indirect losses flowing from the event.

A requirement that the party benefiting from the indemnity is required to mitigate any losses it might suffer as a result of the action that triggers it, is also a good idea.