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American Translators Association (ATA): Business Smarts-Liability Clauses

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American Translators Association (ATA): Business Smarts-Liability Clauses

Liability Clauses


Although business relationships in the translating and interpreting industry can sometimes be casual, every legal agreement with a client or agency must be carefully reviewed for potential pitfalls and misunderstandings. To prevent unpleasant surprises, freelance contractors should thoroughly examine even apparently "standard" agreements, no matter how short the deadline involved. Especially in the U.S., where litigation is more than a theoretical possibility, liability clauses must be reviewed with particular concern.

Dear Business Smarts:

I just received a standard contractor agreement from a U.S. translation agency, which I am asked to sign before I receive more work. It contains the customary clauses on confidentiality, not contacting the end-client, etc., none of which are a problem. However, I stumbled over the following section:

Indemnification: throughout the term of this agreement, translator shall indemnify and hold company and its employees, agents, directors, officers, and affiliated corporations and their respective officers, directors, and employees harmless from and against all loss, cost, expense, damage, or liability or claim thereof, including, but not limited to, bodily injury, property damage, and professional liability caused by or arising out of the negligent or wrongful acts or omissions of translator, its employees, staff, directors, officers of affiliated corporations and their respective officers, directors, and employees, including, but not limited to, any liability to clients as a result of delays in performance by translator. This provision shall survive the termination of this agreement.

I am not a lawyer, but if I understand this right, I could be held responsible without any restriction for the work I submit. What if my work gets changed by an editor or the endclient and is then found to contain a mistake? Should I refuse to sign this agreement and lose the agency as a client? Thank you for your insights.
— Liable?

Dear Liable:

You are very wise to ask these questions and to read the "fine print" of agreements before signing. Unfortunately, it is all too common to sign on the "dotted line" in everyday business situations without a thorough review, especially if the contract is a prerequisite for starting a work assignment. The contract clause you quote sounds like it was copied out of a lawyerly textbook, but it certainly is not a good fit for the type of subcontractor relationship that exists between translation agencies and freelance translators. Indemnification clauses are typically written to limit liability, but in this case, the contract text actually assigns ALL liability to you as the contractor, without any reasonable limitation. Assuming a worst-case scenario, you could be held liable for thousands of dollars in damages for a mistake you made in a document of 200 words. Under no circumstances should you sign this agreement in its current form. However, that does not necessarily mean that you cannot continue to work for this particular agency. Simply cross out the clause, clearly marking the sections you disagree with, and initial the places you have crossed out. For maximum clarity, you may want to send the original printout with your signature by mail instead of fax. It is always a good idea to keep a copy of contracts on file for future reference.

Reprinted from The ATA Chronicle: November-December 2007, p 38