It’s likely that you have had times where you’ve had to sign a form before undertaking a new activity. Whether it’s a simple game of paintball or a martial arts tournament, these activities involve an element of risk. Acknowledging this risk is important – and even more important is that this is in writing. Subsequently, people often sign liability waiver forms which indemnify a party from liability in the event that anything happens. Liability waiver forms protect businesses by notifying that you bear responsibility for the risks you’re taking on. These risks must be acknowledged and accepted by customers prior to commencing the activity.

Avoiding liability

As a business owner, it’s in your best interests not to be liable when an incident occurs on your premises or during your event. Litigation can be time-consuming and expensive for businesses, and this isn’t including the damages you might have to pay. Liability waivers shift the responsibility from your business to your customer.

To minimise the risk of liability, businesses that provide services which involve risk need to ensure that:

• The customer understands the risks involved in undertaking the activity
• Your customer is still willing to undertake the activity
• You have taken all the necessary precautions to ensure the activity is as safe as it can be

If, despite the above, a customer still suffers some injury, then a waiver may hold up in court as a shield from liability, as it is evidence that the customer knew of and assumed responsibility for the risks. However, there are some exceptions.

Exemptions

Negligence

If you were negligent, you can still face legal action in the event that a person is injured or killed. The Law of Negligence and Limitation of Liability Act (2008) Cth defines negligence as the “failure to exercise reasonable care” to avoid causing injury or loss to another person.

Example

You run a bungee jumping business and have for many years. However, in that time you have not updated your equipment, more specifically the harnesses which ensure that people don’t fall. A customer does the jump and the rusted harness snaps. The customer suffers multiple severe injuries and has to pay $22,000 in medical and surgical fees. 

In this case, your business would be liable for customer injuries. This is because you have not updated your equipment, something which is instrumental in ensuring your customer’s safety is negligent. By not ensuring your equipment is safe, your customer is put at risk.

Security issues

You cannot waive liability for not having various alarms such as smoke detectors or fire escapes in place.

Public interest

If your service is considered ‘crucial’ and causes harm (such as if the water supply is contaminated), you would unlikely be able to rely on a liability waiver.

Superior bargaining power

Having superior bargaining power could easily pressure or force your client into blindly agreeing to their terms, of which could be a liability waiver. In scenarios like this, there is the potential for these waivers to not stand, most likely pending a court decision.

Statutory obligations

Many public sector institutions have specific statutory duties which cannot be delegated away.

Ambiguity

Liability waivers need to be clear in their expression and their intentions. They must be specific and not overly vague so as to generalise.

Use this Liability Waiver if:

• You want to protect your business from liability and potential lawsuits
• You want your customers to fully understand the risks of receiving the services your business provides 

What does this Liability Waiver cover?

• Release of liability
• Negligence and misconduct 
• Acknowledgement of risk 
• Advice disclaimer
• Health conditions
• Acceptance of terms

Further Information:

• What is a Liability Waiver Form?
• Do Liability Waivers Hold Up in Court?