Covenant Not to Execute Arizona

What is the difference between a release and a covenant not to execute ? In Arizona a covenant not to execute is not a release from liability. A covenant not to execute "'does not extinguish the plaintiff's cause of action,'" whereas a release "abandons 'a claim or right to the person against whom the claim exists or the right is to be enforced or exercised.'" Cunningham, 194 Ariz. at 241, 242, P 25, 980 P.2d at 494, 495 (quoting Rager v. Superior Coach Sales & Serv., 110 Ariz. 188, 191, 516 P.2d 324, 327 (1973), and 66 Am. Jur. 2d Release 1, at 678 (1973)). This difference between a release and a covenant not to execute is not limited to, or a byproduct of, the special relationship between an insurer and an insured. Monthofer Invs. Ltd. P'ship v. Allen, 189 Ariz. 422, 426, 943 P.2d 782, 786 (App. 1997) ("Our courts have held, in contexts other than disputes between insurers and insureds, that covenants not to sue or not to execute are contracts, not releases.") At least one jurisdiction has held that covenants not to execute eliminate all obligations of an indemnitor and that the obligation of an indemnitor is limited to amounts actually paid by the indemnitee in those situations. See, e.g., City of Columbus v. Alden E. Stilson & Assocs., 90 Ohio App. 3d 608, 630 N.E.2d 59, 65 (Ohio Ct. App. 1993) (finding that a settlement made contingent upon a covenant not to execute was "such a contrived liability against the indemnitor as to be against public policy, as an attempt to expand the indemnitor's obligation to pay 'any judgment' beyond what reasonably could have been the understanding of the parties as to the definition of a judgment against the city arising from the indemnitor's performance under the contract").