The following is an email from the IEA
Brokers P/L, and a copy of the webpage it is directed towards.
This may be of interest to some clubs who require their members to sign
waivers/disclaimers before participating in a club event. I have maintained
for years, and this article seems to bear me out - THAT IF YOU ARE NEGLIGENT
- YOU WILL BE SUED, regardless of most waivers that are out there.
"We are pleased to distribute the March edition of the IEA Sport Monthly Update. In this months update we address the transfer of sports liability through the use of releases/waivers. This article, written by Matthew Finnis of Rigby Cooke Lawyers in Melbourne, includes valuable information on the drafting of these documents.
We trust you find this information useful and as usual welcome any further queries, feedback or other comments.
To open please click on the blue address following:- http://www.ieabrokers.com.au/monthlyupdate18-03-02.html
(This is a copy of it below)
Transferring Sports Liability
As sporting administrators throughout Australia are continually frustrated by issues concerning the availability and affordability for liability insurance, it is natural that attention be directed to means by which sporting organisations can seek to transfer responsibility from themselves and their insurers to those participating in sport and recreation activities.
Whilst risk management is an effective method of reducing an organisation's potential liability, its benefits are often not seen for many years down the track. As such, sport and recreation organisations will often seek to transfer the risks involved in participation to the user by requiring members and participants to sign waiver and indemnity agreements. But just how effective are such agreements in protecting an organisation?
What is a release?
A release is the relinquishment of rights against another party. A release may also be referred to as a waiver (whereby the participant waives their rights to sue should an injury be incurred). To be effective a release must be in writing and must be supported by consideration or in the form of a deed.
What is an indemnity?
An indemnity is a contractual document or clause in a contract whereby one party promises to pay another for any losses that may arise from the acts or omissions of a third party.
Is the clause reasonable?
When drafting a release or indemnity it is necessary to keep in mind that it has to be reasonable. It should be no wider or broader than required to legitimately protect your contractual interests. If a dispute arose over an indemnity or release its reasonableness will be considered. In determining what is reasonable, the wording of the document needs to be considered. A clause providing an indemnity or release for all and every liability which may arise now or in the future may be considered to be too broad and hence unenforceable. Focus must be had on the actual rights which require legitimate protection.
What is the effectiveness of the conditions?
Such documents and clauses have been reviewed considerably over time by the courts. Some liabilities can not be excluded. For example, the Trade Practices Act 1974 (Cth) prohibits the exclusion of some terms which it includes in all consumer contracts for consumer protection. The courts' treatment of such documents and clauses vary widely, resulting from the combined effect of the quality of the document and the circumstances of the matter. A "quality" document reduces the number and type of disagreements that could be experienced.
How should a release and indemnity be drafted?
1. A release should stand on one page, that
is, all relevant considerations must be visible above the signature.
All other information such as registration details, medical considerations,
terms and conditions for participation and safety matters should be provided
separate from the release.
2. Releases should be on standard size paper, care must be taken in folding, as a fold is vulnerable to complaint that the signer did not see all the above. Typeface size should not be such that the clause can only be read with the aid of a magnifying glass.
3. A phrase to the effect, "In consideration of being allowed to participate in...," should be the outset of the release. It has special legal meaning as the foundation for the release, confirming that for the privilege of participating, the participate is willing to relinquish important rights. The organisation must require all participants who are permitted into any area during the activity to sign a release as a condition for participation.
4. A statement as to the inherent nature of the activity should precede an assumption of the risk which in turn should precede the actual release language. The document should not attempt a full list of the risks involved. Full knowledge of all such risks can not be imparted, and inherent risks are not the only risks to be accepted. A listing of principal safety concerns can be shared through a companion document, signs at the place of registration, and orientation discussion. The risk of injury being acknowledged and accepted needs to be explicitly characterised as "serious" or "dangerous" mentioning permanent disability or "paralysis" as well as death.
5. The personalised first person (so "I agree...") is much preferred over the impersonal third person "the participant agrees ..."
6. The document should clearly state that it is a release. It should also clearly state before signature that the person has read and understood it. These statements should be in bold and/or full caps.
7. Unless the release expressly extends to "acts of negligence to the fullest extent permitted by law," the court may not interpret the release as covering claims of ordinary negligence.
8. Where minors are to be permitted to participate, they should sign along with their parent/guardian, with the non-participating parent/guardian needing their own relevant phrasing immediately following on the same sheet. It is advantageous, both educationally and legally, for a junior participant to acknowledge by signature the risks and responsibilities of participation.
The use of consent forms is either to accompany or replace the release. If accompanying, it should obtain at least the participant and parental consent for emergency medical attention to be provided if warranted. If a consent form is used in lieu of a release, the assumption of risk aspect of the release needs to be added.
Any such document that requires signature as a term and condition for participation needs to be retrievable. Procedures for collecting, storing, and retrieving these forms are as important as the phrasing constituting the agreement. As for length of storage, especially if minors are involved, up to 10 years is a good rule of thumb.
Warnings are more directed at the tortious duty of care and usually arise in circumstances where a contract is not available or appropriate. Warnings are highly appropriate for outdoor recreation activities. A warning sign by an occupier which tells of the existence of the danger may satisfy the standard of care to go to the discharge of the duty, and thus limit or extinguish potential liability in tort. Conversely the failure to erect such a sign may lead to a finding of negligence.
Warnings of Natural Area Dangerous Conditions
Warnings have an important role, and on occasion are essential, to remove or limit liability. The essence of a good warning is communicating the warning to the individual, so that the person will be aware of, and knowledgeable about, the risk he or she is about to undertake and understand its meaning. Warnings should be obvious and direct, specific to the risk, comprehensible and at the point of hazard.
The Key Principles are essentially:
1. Warning to the participant/user must be
given where there is latent or hidden hazard, the hazard is unknown to
the participant and not easily identified, the entity responsible has actual
or constructive knowledge of the danger and, an invitation has been
given to enjoy the outdoors with the presumption of no hazardous situations/conditions.
2. There is no duty to warn the participant/user when the danger is open and obvious to the user, when there is not duty to the person, or the condition is totally natural. (However, where there is a responsible authority it may be reasonable in the circumstances for that authority to give a warning of a danger even where the danger is open and obvious or where it is totally natural).
Participants in recreational activities should share responsibility for risks involved in the activity they chose to participate in. Participants should also assume responsibility for any problems caused by their participation if such behaviour lies outside the terms and conditions of participating in the activity. It is important to avoid as much unnecessary risk as possible and transfer those responsibilities that can or should be transferred to the participants. Indemnities and releases are contractual documents that can be used to attempt to transfer participation risks, however should not be relied upon by sporting organisations to completely absolve themselves of liability. .
Article Written by Matthew Finnis
Rigby Cooke Lawyers
PH: 03 9321 7801
Fax: 03 9321 7900
The editor of the IEA Sport Monthly Update is
joint Chief Executive Officer, Rod Hughes.
IEA has offices in every state. National freecall number 1800 SPORT 1 (1800 77678 1)
Disclaimer The information provided in this Email and on the IEA web-site is to be used as a reference only. IEA accepts no responsibility for the accuracy of the information or your reliance upon it. The views of contributors are their own and do not necessarily represent the views of IEA
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