Sidetrack Agreement

Definition - What does Sidetrack Agreement mean?

A sidetrack agreement is an agreement between a railroad company and a property owner whose property is used as part of the company's railroad track. This agreement minimizes a portion of the railroad company's liability.

Insuranceopedia explains Sidetrack Agreement

Sidetrack agreements are drawn up when the design of a railroad system affects a private property. Representatives from the railroad company will approach the property owner and ask them for permission to build a sidetrack on their property in exchange for financial compensation.

The sidetrack agreement is, specifically, a contract clause that shields the company from liability for a loss that might happen on the property where the track is lying. The company, for instance, will have legal immunity in the case of property damage.

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