Legal Question in Business Law in California

The statute you are referring to is actually Civil Code Section 2777, which states,

"2777. One who indemnifies another against an act to be done by the latter, is liable jointly with the person indemnified, and separately, to every person injured by such act."

Indemnification under Civil Code �2777 is generally contractual. That means there is an express written or oral agreement to indemnify a party.

If you want to take advantage of California law, either:

1. The contract has to provide that the laws of the State of California control;

2. You have to sue in California, for an act that occurred in California.

If the business is based in California but the act that you are suing for occurred in Illinois, you would have to sue in Illinois and use Illinois law (unless your contract says otherwise).

In addition, limits on your right to sue may exist as a consequence of the form of your business. A corporation or LLC doing business in California must be registered with the California Secretary of State and ,ust pay an annual franchise tax. A business required to register, to make periodic filings, and to pay taxes will be suspended and may not have access to state courts.

An artificial person such as a corporation or LLC cannot appear in court "pro se;" it must be represented by an attorney licensed to practice in California.

Next, the party suing must be the so-called "real party in interest." Generally, an owner of a corporation may not sue for an injury to the corporation, nor may the corporation sue for an injury to the owner.

Finally, there are some rules governing jurisdiction in a particular state's courts. As the previous answer points out, there may be a jurisdiction provision in the indemnity agreement itself. If not, the plaintiff may choose to sue in a given state if the defendant is present in that state, does significant business there, negotiated the agreement there, or is in some other way connected with that state.