
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 38USC7317]

 
                      TITLE 38--VETERANS' BENEFITS
 
              PART V--BOARDS, ADMINISTRATIONS, AND SERVICES
 
 CHAPTER 73--VETERANS HEALTH ADMINISTRATION--ORGANIZATION AND FUNCTIONS
 
           SUBCHAPTER II--GENERAL AUTHORITY AND ADMINISTRATION
 
Sec. 7317. Hazardous research projects: indemnification of 
        contractors
        
    (a)(1) With the approval of the Secretary, any contract or research 
authorized by section 7303 of this title, the performance of which 
involves a risk of an unusually hazardous nature, may provide that the 
United States will indemnify the contractor as provided in paragraph 
(2), but only to the extent that the liability, loss, or damage 
concerned arises out of the direct performance of the contract and to 
the extent not covered by the financial protection required under 
subsection (e).
    (2) Indemnity under paragraph (1) is indemnity against either or 
both of the following:
        (A) Liability (including reasonable expenses of litigation or 
    settlement) to third persons, except liability under State or 
    Federal workers' injury compensation laws to employees of the 
    contractor employed at the site of and in connection with the 
    contract for which indemnification is granted, for death, bodily 
    injury, or loss of or damage to property, from a risk that the 
    contract defines as unusually hazardous.
        (B) Loss of or damage to property of the contractor from a risk 
    that the contract defines as unusually hazardous.

    (b) A contract that provides for indemnification in accordance with 
subsection (a) must also provide for--
        (1) notice to the United States of any claim or suit against the 
    contractor for 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 any such suit or claim for which 
    indemnification is provided hereunder.

    (c) A payment may not be made under subsection (a) unless the 
Secretary certifies that the amount is just and reasonable.
    (d) Upon approval by the Secretary, 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.

    (e) Each contractor which is a party to an indemnification agreement 
under subsection (a) shall have and maintain financial protection of 
such type and in such amounts as the Secretary shall require to cover 
liability to third persons and loss of or damage to the contractor's 
property. The amount of financial protection required shall be the 
maximum amount of insurance available from private sources, except that 
the Secretary may establish a lesser amount, taking into consideration 
the cost and terms of private insurance. Such financial protection may 
include private insurance, private contractual indemnities, self-
insurance, other proof of financial responsibility, or a combination of 
such measures.
    (f) In administering the provisions of this section, the Secretary 
may use the facilities and services of private insurance organizations 
and may contract to pay a reasonable compensation therefor. Any contract 
made under the provisions of this section may be made without regard to 
the provisions of section 3709 of the Revised Statutes (41 U.S.C. 5), 
upon a showing by the Secretary that advertising is not reasonably 
practicable, and advance payments may be made under any such contract.
    (g) The authority to indemnify contractors under this section does 
not create any rights in third persons which would not otherwise exist 
by law.
    (h) Funds appropriated to carry out this section shall remain 
available until expended.
    (i) In this section, the term ``contractor'' includes subcontractors 
of any tier under a contract containing an indemnification provision 
pursuant to subsection (a).

(Added Pub. L. 102-40, title IV, Sec. 401(a)(3), May 7, 1991, 105 Stat. 
220.)
