The enforceability of liability waivers is generally a state law matter, and states vary widely in their stance towards these provisions. Some states, including Louisiana and Virginia, consider waivers of liability for physical injury to be unenforceable. Other states have a freedom -of -contract stance and allow liability waivers if they meet a few basic requirements.
To be legally enforceable in states where they may be used, a waiver should meet the following criteria:
● The waiver must be clear and unambiguous. This means that the waiver must clearly specify the types of activities and legal claims it applies to. The waiver should not be overly broad to avoid confusion about its terms.
● The waiver should be conspicuous. This means that the liability waiver should be a separate document and should not be buried within a registration form or document that also addresses other matters.
● The waiver should not include intentional, reckless, or grossly negligent conduct. Waivers are designed to provide a liability shield against ordinary negligence (i.e., unintentional conduct or oversight). They are not a get-out-of-jail-free card for companies to engage in wanton irresponsibility.
● The waiver can not violate state laws or public policy. Not only must liability waivers comply with the law in the state where they are drafted, they also must not violate public policy. For example, a waiver may be determined to be against public policy if one party has substantially less bargaining power, so that the contract puts them at the mercy of the other party’s negligence
● The waiver should comply with basic contract law principles. Each state has developed a body of case law applicable to liability waivers. In addition to these state-specific rules, basic contract law principles apply to waivers.
In summary, a liability waiver should be as detailed and as clear as possible. It should describe the activity the customer will engage in and its location, list the possible risks and injuries that could arise from that activity, and release the business from negligence to the full extent of the law, without creating a blanket shield against grossly negligent conduct. The names and addresses of the parties must be included, and the waiver must be presented to each individual customer for their signature, as a release that purports to waive liability on behalf of a group is not likely to be enforceable. Above all, have an attorney review the waiver of liability to ensure it complies with applicable state laws and will pass muster if tested in court.
Are You Doing Everything Possible to Protect Your Business?
The decision to have customers sign a liability waiver is usually industry-dependent; but new risks are constantly emerging, and companies must always be prepared to update their mitigation strategy. Although a liability waiver is not a guarantee against all liability, when well-written, it can be an important part of a company’s risk management strategy. One-size-fits-all online documents that are not tailored to your unique business activities and jurisdiction’s laws could fail a court challenge. For help creating a customized liability waiver designed specifically for your business, contact our office to schedule an appointment by visiting http://www.reidcouncillaw.com or calling (215) 258-4620.