- Right to recover damages – he is entitled to recover all damages which he might have been compelled to pay in any suit in respect of any matter covered by the contract.
- Right to recover costs – He is entitled to recover all costs incidental to the institution and defending of the suit.All the costs that he is compelled to pay in such suit if in bringing or defending it he did not contravene the orders of the promisor and has acted as it would have been prudent for him to act in the absence of the contract of indemnity or if the promisor authorized him in bringing or defending the suit.
- Right to recover sums paid under compromise – he is entitled to recover all amounts which he had paid under the terms of the compromise of such suit. However, the compensation must not be against the directions of the indemnifier. It must be prudent and authorized by the indemnifier.
- Right to sue for specific performance – he is entitled to sue for specific performance if he has incurred absolute liability and the contract covers such liability. The promise in a Contract of Indemnity, acting within the scope of his authority, is entitled to recover from the promisor.
- Right of recover Damages: - All the damages that he is compelled to pay in a suit in respect of any mater to which the promise of indemnity applies.
In case of Mohit Kumar saha v. New India Assurance Co. It was held that the indemnifier must pay the full amount of the value of the vehicle lost to theft as given by the surveyor. Any settlement at the lesser value is arbitrary and unfair and violates Art.14 of the Constitution. All sums which he may have paid under the terms of any compromise of any such suit.
It is important to note here that the right to indemnity cannot be claimed of dishonesty, lack of good faith and contravention of the promisor’s request. However, the right cannot be negatived in case of oversight. [Yeung v HSBC]
Labels :