This is Part II of a 2 part series about liability waivers. An authority in the field of sport insurance, John shares some things he has learned about waivers while in the insurance business.
Assumption Of Risk (AOR) As A Defense To Negligence
The second protective purpose of a waiver/release is to trigger the Assumption Of Risk Defense under tort law – in other words – to provide evidence that the sports organization gave adequate warnings of the risks so that an argument can be made that the participant assumed those risks.
In order to trigger the AOR defense to a negligence lawsuit, the waiver/release should contain the proper assumption of risk language; though you can also demonstrate assumption of risk by having evidence (usually in the form of other witnesses) of other types of good warnings such as signs, brochures, verbal instructions or safety briefings, etc. With respect to the waiver and release, it should specifically mention the types of risk that are assumed (known and unknown) as well as worst case injury scenarios (permanent disability and death). It is also important to note that often times courts will only apply the AOR defense to inherent risks of the activity. Inherent risks are those risks that the organization will simply not be able to control, regardless of their best efforts (ex: in baseball, being hit by a pitched ball).
With minors and the AOR defense, you should note that the minor must be capable of understanding the risks and must sign the assumption of risk portion of the waiver/release. Just like with adults, you can demonstrate assumption of risk by both the language in the waiver/release and by the verbal instructions or safety briefings given. Many courts have ruled that a seven year old child is capable of understanding the inherent risks involved in an activity if adequately explained.
A successful AOR defense may or may not result in having a lawsuit dismissed on Summary Judgment. If not on Summary Judgment, this defense can come into play much later in the legal proceedings when evidence is being introduced before a trier of fact. I am told by claims adjusters that the threat of this defense is probably worth a 35% reduction in damages or claims paid out in many cases. A 35% reduction is significant on a large case. As a result, waiver/release agreements are definitely worth the paper they are written on even if they don’t result in the lawsuit being dismissed as a matter of contract law.
Pitfalls to Avoid
You might be asking yourself what constitutes a “well drafted” waiver/release? Quite simply, it means that virtually every phrase in every sentence was specifically written to counter a court case that found a pitfall that resulted in the waiver/release not being enforced. There are at least ten common pitfalls that must be avoided. The most common pitfalls to avoid are as follows:
- The wording must not be unclear or ambiguous. It must be worded in simple terms easily understandable by the common man. Legalese should be avoided.
- The print or type must be large enough to be easily read – at least 10 point type.
- Never commingle your waiver/release on the same page with another registration form. Many courts will strike a commingled waiver/release because it is not conspicuous.
- Gang or group style signatures where all participants sign underneath a single document are frowned upon by the courts. Remember, these waiver/release documents are contracts and they need to be treated with the seriousness of a contract. You need to be able to demonstrate that the participants who are signing these contracts understand them and are signing them voluntarily. So, if a line forms at your event where parents/players are waiting to sign, the parents/players in the front of the line may feel rushed and they might not understand the rights that they are giving up. Or, this is the argument they or their clever attorney will later use when they want to avoid or negate the waiver/release contract and sue your organization.
- The first sentence should state “In consideration of being allowed to participate . . . .” A waiver/release is not a valid contract unless all parties receive consideration (“something of value”). The consideration received by the sports organization is the promise not to sue and the consideration received by the player/parent is the right to participate.
- The waiver/release should warn of the full range of possible injuries including the key words “permanent disability or death”. This is an important part of the Assumption Of Risk defense.
- All risks should be assumed, both “known and unknown”. The key word here is “unknown”. Some waivers get too specific and limit risks to games and practices and this may lead to the omission of important risks such as transportation and non-sports outings. This is also an important part of the Assumption Of Risk defense.
- The waiver/release should never attempt to disclaim responsibility for “gross negligence” or other outrageous conduct. It should disclaim responsibility for “negligence”.
- The waiver/release should have a phrase releasing the organization from negligence to “the fullest extent permitted by law”. This magic phrase may allow a court to strike the phrases that are contrary to state law while leaving the rest of the waiver/release intact.
- A new waiver/release should be signed before each registration period even if one is on file from a previous registration period.
John Sadler is president of Sadler & Company, Inc., an insurance agency that specializes in sports and recreation insurance in all 50 states. Sadler has over 25 years of experience and is a licensed attorney, sports insurance expert, and sports risk manager. For more information on sports insurance and sports risk management, visit www.sadlersports.com and click on the links to the blog and risk management reports/forms/videos.
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