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If you run a business that offers recreational or potentially dangerous activities, you should have a waiver in place with your customers or participants. A well-drafted waiver will clearly outline the potential risks associated with participating in the recreational activities and whether the risks are likely or unlikely. A waiver will also seek to exclude your responsibility if any of those risks eventuate. Further, it will require the participant to agree not to sue you.

This article will explore:

  • the normal statutory obligations with which you must comply when providing services;
  • how the law allows you to exclude these obligations when providing recreational activities; and
  • why it is important for participants to properly read and accept your waiver prior to participating. Without adequate acceptance, your waiver will not be protective.

Recreational Services Under the Australian Consumer Law

Under the Australian Consumer Law (ACL), there are a number of guarantees that you must provide when offering services. Your services must be:

  • provided with care and skill; 
  • fit for their intended purpose; and
  • provided within a reasonable time (if applicable). 

If the services do not meet these guarantees, the customer may seek a remedy. For instance, the customer may request their money back or may seek to receive the services again. 

Recreational Services

There are exemptions to the ACL when it comes to recreational services. This is because the law recognises that some services are riskier than others. 

If you are providing recreational services, you can exclude, restrict, or modify these guarantees. What this means is that you can ask your participants to ‘waive’ their rights to sue you if they suffer some sort of injury while participating in your recreational activities. 

Recreational services are those that include participation in:

  • a sporting or leisurely activity; or
  • any other activity:
    • where there is a significant degree of physical exertion or physical risk; and
    • which is for recreation, enjoyment or leisure. 

Clearly, this involves a wide range of activities. 

There are, unsurprisingly, some requirements when attempting to exclude your responsibilities under the ACL.

Excluding the Consumer Guarantees for Recreational Services

Under the ACL, you can exclude, restrict or modify the consumer guarantees when supplying recreational activities. You can do this as long as the exclusion, restriction or modification limits your liability for the following risks:

  • death;
  • physical or mental injury (including aggravating a physical or mental injury);
  • contracting a disease; or
  • aggravating an existing condition that is harmful or could result in harm to the individual or community. 

Assumption of Risk

Your waiver needs to articulate the potential risks and dangers that the participant voluntarily accepts by participating in the activities. So, while the risks outlined above are a good starting point, you should expand upon them in your waiver to include more specific examples.

Even if a risk is unlikely to take place, it is still worth stating it in the waiver so that the participant cannot later argue that they were not aware of the risks of participating. 

It is important to note that you cannot exclude liability for the risks outlined above if the participant suffers an injury that is caused by your reckless conduct. Your conduct will be ‘reckless’ where you:

  • are aware, or should have been aware, of a significant risk that your conduct could result in personal injury to another person; and
  • engage in that conduct despite the risk. 

For instance, if you run a go-karting business, and the straps on your helmets are loose, and the helmets could fly off the driver’s head, yet the drivers use these helmets anyway, this would be considered ‘reckless conduct’ as you are failing to take reasonable care regarding this obvious risk. However, simply operating a go-karting business in itself will not necessarily be reckless conduct. 

Release and Indemnity

In the release and indemnity section of the waiver, the participant waives their right to sue you or hold you responsible if they suffer any ‘liability’ (such as loss, damage or injury) resulting from participation in the activities. In other words, you are seeking a promise from the participant that they will not:

  • make a claim against you; or
  • hold you responsible, should they get injured by participating in the activities.

Of course, the participant will not waive their right to sue you if the injury was due to your reckless conduct.

A Proper Mechanism for Acceptance

You can only rely upon a waiver if the participant has properly read, understood and accepted it. Alternatively, you may check if their parent or guardian has where the participant is a minor or does not have legal capacity to enter into a contract. 

If a participant suffered an injury after participating in the recreational activity you provide, and they had not properly accepted your waiver, you may not be able to rely on it to exclude or limit your liability. 

A recent 2021 case, Hayley Marks v Skydive Holdings, looked at whether a skydiving company could rely on their waiver. To book a skydive, the participant had to complete an online form, which included a hyperlink to a waiver. The participant had an accident during the skydive and attempted to sue the company. 

The waiver had clearly set out the risks involved in skydiving. Still, a decision was made in this case that the participant had not read and understood those risks because the waiver was within the online terms and conditions. Therefore, the skydiving company could not rely on their waiver to exclude their liability. 

Practically, you can ensure that your waiver is properly accepted by:

  • ensuring that your participants have a chance to read and ask you questions about your waiver prior to participating in the activities; 
  • ensuring your participants sign the waiver; and
  • keeping a copy of the signed waiver.

If your waiver is hidden in a set of online terms and conditions, where the participant simply has to ‘click’ to accept the terms, it may be difficult to show that they were adequately informed of the risks. 

Key Takeaways

Running a business can be considered a risk in its own right. When you provide recreational services, it is going to be absolutely critical to provide those services safely to minimise the chance of getting sued should an accident happen. Having a well-drafted waiver in place that is properly accepted by each participant is going to protect your business. If you need advice as to whether you provide recreational activities, or if you need assistance drafting a waiver, contact LegalVision’s contract lawyers on 1300 544 755 or fill out the form on this page.

Frequently Asked Questions

What is a recreational waiver?

A recreational waiver outlines the potential risks associated with participating in a recreational activity. It will seek to exclude your responsibility if any of those risks eventuate, and requires the participant to agree not to sue you.

Can you exclude your responsibilities under the Australian Consumer Law (ACL)?

Under the ACL, you can exclude, restrict or modify the consumer guarantees when supplying recreational activities as long as it limits your liability for death, physical or mental injury, contracting a disease or
aggravating an existing condition that is harmful. However, you cannot exclude liability if the participant suffers an injury caused by your reckless conduct.

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