10 U.S.C. § 3861: Research and development…

Summary

With the military department Secretary’s OK, a research or development contract can say the United States will cover certain losses that come directly from doing the work, but only if they are not already paid by insurance or other sources. It can cover two things: (1) claims by third parties (including the contractor’s employees) for death, injury, or property damage from risks the contract calls “unusually hazardous,” and (2) loss or damage to the contractor’s own property from those risks. The contract must require the contractor to tell the United States about any claim or lawsuit, and the United States can choose to run or help with the defense. No payment can be made unless the Secretary or a designated official certifies the amount is fair and reasonable. With the Secretary’s approval, payments may come from (1) funds set aside for the contract, (2) available research and development funds not already used, or (3) funds specifically appropriated for these payments.

Title 10, §3861

Armed Forces, Source: USLM XML via OLRC

(a)With the approval of the Secretary of the military department concerned, any contract of a military department for research or development, or both, may provide that the United States will indemnify the contractor against either or both of the following, but only to the extent that they arise out of the direct performance of the contract and to the extent not compensated by insurance or otherwise:

(1)Claims (including reasonable expenses of litigation or settlement) by third persons, including employees of the contractor, for death, bodily injury, or loss of or damage to property, from a risk that the contract defines as unusually hazardous.

(2)Loss of or damage to property of the contractor from a risk that the contract defines as unusually hazardous.

(b)A contract, made under subsection (a), that provides for indemnification must also provide for—

(1)notice to the United States of any claim or suit against the contractor for the death, bodily injury, or loss of or damage to property; and

(2)control of or assistance in the defense by the United States, at its election, of that suit or claim.

(c)No payment may be made under subsection (a) unless the Secretary of the department concerned, or an officer or official of his department designated by him, certifies that the amount is just and reasonable.

(d)Upon approval by the Secretary concerned, payments under subsection (a) may be made from—

(1)funds obligated for the performance of the contract concerned;

(2)funds available for research or development, or both, and not otherwise obligated; or

(3)funds appropriated for those payments.

Notes & Related Subsidiaries

Editorial Notes

Amendments

2021—Pub. L. 116–283 renumbered section 2354 of this title as this section and substituted “Research and development contracts: indemnification provisions” for “Contracts: indemnification provisions” in section catchline.

Statutory Notes and Related Subsidiaries

Effective Date

of 2021 AmendmentAmendment by Pub. L. 116–283 effective Jan. 1, 2022, with additional provisions for delayed implementation and applicability of existing law, see section 1801(d) of Pub. L. 116–283, set out as a note preceding section 3001 of this title.

§3861 Research and Development Contracts: Indemnification Provisions