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This week, I am going to talk about the enforceability of waivers, which are incredibly common and powerful clauses in contracts we all come across almost every day. From getting on a chairlift or a ferris-wheel, to renting a car, a bicycle or piece of garden equipment, or even leaving a jacket at a coat check, waivers are everywhere. Giving up, or waiving, the right to claim for the consequences of someone else’s carelessness is something we all frequently do.
A waiver is a promise not to sue for any injury, death or property damage arising out of the activity, including loss caused by the clear negligence of another person. British Columbia is the most waiver-friendly province in Canada, and Canada likely the most favourable country in the world for enforcing waivers.
Insurance companies like waivers because they reduce the number of claims they have to pay out because waivers reduce the likelihood their insured will be successfully sued. Businesses like waivers because they reduce the cost of their insurance and when a business cannot get liability insurance, a well-drafted and presented waiver offers the opportunity to avoid legal responsibility for the negligence of the business and its employees.
For many people, the idea that they might be badly injured by the obvious negligence of an another person and have no legal recourse to pay for wage loss or medical expenses, can be frightening. And it should be.
While many waivers are enforceable, they must meet several legal tests. In order for a waiver to be effective in removing someone’s right to sue for another’s negligence, the waiver must meet the following three part test:
So, regarding the first part of the test, does the waiver apply to the facts, this means the court must consider whether the terms of the waiver include a description of the risks that caused the person’s injury. This means a waiver can only cover potential risks which were in the mind of the person at the time they signed the release. For example, if you are skiing, it is likely in your mind you might ski off a poorly marked trail and injure yourself, or be injured in an avalanche which could have been prevented.
You would not, however, contemplate being shot by an employee who was carelessly handling a firearm, or being food poisoned by poor practices in the ski lodge. In other words, the cause of the injury that the waivers seek to avoid legal responsibility for, must be reasonably described in the waiver and be generally foreseeable by the parties. Clear language is required if a business operator wishes to release themselves from liability for the negligence of their employees or agents. The courts must also consider whether the participant actually understood what they signed.
Generally, by signing a waiver, it is presumed that the participant has read and understood it. The activity operator is under no special obligation to ensure that participants understand what they have signed. However, where the operator knew or should have known that a participant was unaware of the legal or practical effects of signing the waiver, they have to take reasonable steps to advise the participant.
This can arise where the participant was told to sign the waiver in a hurried or casual manner and not given adequate time to read and understand the waiver.
The second main requirement of a valid waiver is that it must not be unconscionable. In other words, even if the waiver applies to the facts of an accident, the court may find the waiver unenforceable because it is unconscionable. To prove that a waiver is unconscionable, the person who signed the waiver and the person relying on the waiver must have been in significantly unequal bargaining positions. The business operator must also have abused this power to get the participant to agree to an unfair waiver.
That said, participants almost always have the choice between agreeing to the waiver and participating, or not participating at all. Courts have upheld waivers even in cases where the participant has traveled long distances to participate in an activity, only to find that if they didn’t accept the waiver they would be turned away. The courts do not generally view inconvenience suffered by a person because they cannot partake in an activity unless they sign a waiver as an inequality in bargaining power that makes signing the waiver unconscionable.
The third main requirement of a valid waiver is that the waiver must not be against public policy – that is, the waiver is contrary to the interests of the general public as a whole. The power to overturn a waiver because of public policy is rarely exercised by the courts in BC. Waivers in adventure tourism activities, for example, generally do not give rise to public policy concerns because, by definition, these activities have inherent risk and people generally expect some risk.
Many activities, however, with reasonable care of the business, should be low risk, and a court might find it is against public policy to enforce a waiver where to do so would discourage routine safety practices.
A properly drafted and presented waiver can provide business owners with strong legal protection from claims. However, it should never be assumed that a liability waiver will provide complete protection from law suits. In cases where there has been significant injury or property damage, or death, a judge should be asked to decide whether the waiver is enforceable.
We hope you have learned something from this week’s blog. Please feel free to like us on Facebook, follow us on Twitter and subscribe to our YouTube channel to receive notice of our future weekly video blogs on the law. League and Williams is a Victoria, BC based law firm with expertise in injury law, estate disputes and marine law and may be reached via email at email@example.com or phone at 250-888-0002. If you are injured and would like a free consult, give us a call for a free consult. We are here to help injured parties get the fair compensation that they are entitled to.