How to write an effective liability waiver - Definitive Guide
- What is a liability waiver?
- Importance of writing a good waiver
- What makes a good waiver?
- What are the main clauses in a waiver?
Our tagline 'waivers are boring' may be true for most people, but we actually find them super-interesting, so we'll do our best to make them as simple as possible for you.
In its simplest form, a liability waiver is an agreement which you get customers to sign with the aim of reducing or removing their right to sue you for injuries or damages suffered while using your facilities or taking part in your activity. For example if you run a gym and someone strains themselves while working out in your facilities, by signing the waiver they have stated that they've released their rights to sue you for damages. This would also apply if you're doing Segway tours and someone falls off their machine or drives into the road and hits a car.
A little waiver of our own - note that we are not lawyers, and nothing here should be considered as legal advice.
There is not such thing as a standard waiver that's suitable for any business, and some of the factors affecting how effective a waiver would be are details of your particular business, what field you operate in and the particular laws and previous court rulings in your jurisdiction. We therefore always recommend that you get legal advice on your particular wording from a lawyer who is knowledgable and experienced with your particular type of business and your locality.
Whilst waivers can't provide full protection under any cirumstance, a well-written waiver will increase the chance that it will be enforceable should a case end up in court, and will also increase the chances that a dispute can be settled before getting to that stage and accumulating the associated costs.
Waivers should be broad enough to cover all the possible harms a person might suffer, and all the phases of participation. For example, let's say you have a waiver that only waives liability for injuries whilst exercising in the gym - this waiver wouldn't cover a customer slipping and hurting themselves in the bathroom.
At the same time waivers should not be too broad - a waiver that waives liability for all injuries suffered by a customer would likely be unenforceable as courts generally consider it against public policy to release a business from all liability to all people. Rather, the courts like to see specific various risks spelled out. For example in the case Roberts v. T.H.E. Ins. Co (2016) at the Wisconsin Supreme Court, a customer who was waiting in line for a hot air balloon was hit by the basket when it came free. They had signed a waiver, but it didn't specify risks while standing in line, and court stated in it's judgement:
"Sundog's exculpatory waiver is overly broad and all-inclusive ... an agreement cannot be so broad "that it would absolve [the defendant] from any injury to the [plaintiff] for any reason."
The judgement in this case also stated:
"Not only is the waiver overly broad, it is not clear whether waiting in line for the ride is something Roberts would have contemplated as being covered by the waiver, especially because she was not required to return the waiver before she got into the line."
which reflects the importance of calling out specific risks.
Waivers should be written in clear, plain language, avoiding redundant wording (such as "represents, acknowledges and agrees"), legal jargon and repeated phrases. The more complex the language used, and the longer a waiver, the more difficult it would be to persuade a jury that the waiver was read and understood, and therefore that the customer knowingly waived their rights. Instead use first and second persons ("I agree to"), use everyday language and make sure that it can be understood by customers (and jurors!) of normal intelligence.
Waivers should be kept separate from other parts of the agreement, so the customer has an opportunity to consider it separately and explicitly. We especially recommend against including them as a 'T&Cs' style checkbox in the middle of a product purchase where often the user will not even see the contents of the waiver unless they click a link to another page.
Waiver law and case history differs between different courts, and if well-drafted your waiver should be customized to be as valid as possible in the jurisdiction of your business. Examples of regional differences are that waivers for pools and gyms are generally deemed void as against public policy in New York State, and in California the negligent act needs to be reasonably related to the purpose for the release. Note that in most of the world (including the USA and EU) online waivers such as speedyWaiver are valid.
A good waiver is tailored to the specific needs of the business, for example including specific risks that are unique to that business.
The customer should be given enough time to read the waiver, with the opportunity to have any questions answered and under no pressure to agree to it. If any contract is signed under duress then it may be considered null and void.
The 'assumption of risk' clause states that the participant understands the risks that they will be undertaking, and that these risks could result in harm or injury. Make sure to spell out the forseeable risks in this clause.
The 'hold harmless' clause is the core of the waiver, and is what states that the business won't held liable in the case any of any harm or injury.
Indemnification means to insure against loss or damages, ie. it's a guarantee to make good in case of a loss. In our context the indemnification clause states that the customer is insuring the business against any loss or damages the customer causes, whether by accident or not.
Understanding the difference between indemnification and 'hold harmless' can be confusing. Whereas to 'hold harmless' states that the business isn't blamed or liable for any damage in the first place, the indemnification is insurance against the losses. The 'hold harmless' is the release of an obligation against the business, whereas the indemnification is the addition of an obligation against the customer.
Whether they are treated differently in practice depends on the local courts. In general a 'hold harmless' clause provides stronger protection, but it's best to include both in case the 'hold harmless' clause is ruled invalid but the indemnity clause is accepted.
The severability clause states that if any part of the waiver is found to be unenforceable, the rest of the waiver still applies. Without this, if part of the waiver is not found legally valid by the court then the whole waiver may be struck down.
Waivers should specify which state or country's law will apply to that waiver should it reach court. This is important because the relevant laws differ between different states and different countries, and a waiver that was drafted to comply with the laws of one particular state or country, may be declared invalid when challenged in another state or country.
As mentioned above, contracts signed under duress may be considered null and void. To help remove ambiguity a waiver should specify that the signer is signing the waiver voluntarily and free from coercion, and that the signer does not need to take part in the related activity.
It's a good idea for the customer to have to confirm that they have declared any health problems that could affect participation, and if relevant a high enough skill and fitness level. Depending on the activity, it can request a medical certificate should there be any issues - for example should a customer with asthma want to take part in a fitness class.
This clause allows the provider to seek medical care such as first aid, CPR, emergency transport, dentist treatment, etc for the participant in the event that the customer suffers an injury or is otherwise unable to give consent to treatment themselves. It also states that the customer is responsible for reimbursing all costs of the care.
The customer should sign a clause agreeing to listen to and follow all instruction given by the staff, whether orally or written, and to wear any safety equipment. It can also include an agreement to inform the staff if anything occurs that they think may endanger their own, or any other particpant's safety.