Opinion ID: 1209550
Heading Depth: 1
Heading Rank: 3

Heading: did rogers violate its contractual duty to defend and become liable as a matter of law?

Text: The state claims that Rogers had two distinct duties: first, to defend the state against all claims, and second, to indemnify the state for all judgments rendered against it. The state analogizes to insurance cases, and claims that Rogers' wrongful refusal to defend leaves it liable for the full amount of the settlement. In response, Rogers argues that AS 45.45.900 has modified Stephan & Sons, supra, in which this court held that duties to defend and indemnify are separate and distinct, and argues that the statute has absolved Rogers of its duty to defend. This case is distinguishable from the case of Stephan & Sons. In Stephan & Sons, 629 P.2d at 72, the indemnity provision states that [t]he contractor shall indemnify, save and hold the City harmless, and defend the City. (Emphasis added). Here the indemnity clause states that [t]he contractor shall indemnify and save harmless the Department. The phrase save harmless does not imply a duty to defend, and nothing else in the clause suggest that such a duty exists. [4] Recently this court remarked in a footnote that the language indemnify and save harmless obligates the indemnitor to defend and indemnify the indemnitee. C.J.M. Construction, Inc. v. Chandler Plumbing & Heating, Inc., 708 P.2d 60, n. 5 (Alaska 1985). That language was imprecise and what we intended to make clear, and what we now state, is that the language in the indemnity provision only obligates the indemnitor to reimburse the indemnitee for the costs incurred in defending any claims. There exists no affirmative duty to defend under the language indemnify and save harmless, but only a duty to reimburse for costs of defense, whether successful or not. This comports with the law in most jurisdictions. Shannon v. Kaiser Aluminum and Chemical Corp., 749 F.2d 689, 690-91 (11th Cir.1985); Chadwick-BaRoss v. Martin Marietta Corp., 483 A.2d 711, 717 (Me. 1984); Farber v. State, 106 Idaho 677, 682 P.2d 630, 631 (1984); St. Paul Fire & Marine Ins. Co. v. Crosetti Bros., Inc., 256 Or. 576, 475 P.2d 69, 71 (1970). AFFIRMED in part, REVERSED in part and REMANDED for further proceedings.