Can a good waiver actually save you money? Use these waiver evaluation questions to determine how well your waiver will hold up in a lawsuit - which can get quite costly!

A liability waiver (often referred to as a "release") is a contract between the service provider (individual professional or fitness business) and the participant, signed prior to participation, by which the participant agrees to excuse or absolve the provider of any fault or liability for injuries resulting from the inherent risks of the activity and the ordinary negligence of the service provider, its employees or its agents. Most fitness professionals are familiar with waivers, and understand that they can provide protection from liability. Many, however, do not understand the requirements of a good waiver or the limitations of waivers. And, many fitness professionals don't realize how costly a lawsuit can be if their waiver doesn't hold up in a court of law.

A well-written waiver, signed voluntarily by an adult participant, will, under certain circumstances, protect a service provider from liability for negligence in at least 45 states. In fact, a number of states now enforce waivers signed by a parent on behalf of a minor participant. On the other hand, a waiver will not always protect the provider; often courts hold that a waiver is not enforceable and the provider must stand trial for negligence. A waiver can fail for many reasons, but one of the most frequent causes is that the waiver is poorly written or is not sufficiently broad and encompassing. Fortunately, providers can take steps to reduce the likelihood of this type of waiver failure.

Following is an evaluation form that you can use to evaluate a waiver. First, get a copy of the waiver in use or being considered. Then, answer the following questions honestly and realistically - fooling yourself can be very expensive! If the answer is "yes" to the question, record the specified number of points. Record a zero for any question that is answered "no," or when you are unsure of the answer. Total your points for each section and then for the entire evaluation.

Liability waiver evaluation questions

Physical characteristics of the agreement
1. Is your waiver a separate agreement of one to three pages? (3 points if the agreement serves only for liability protection - no application, registration, sign-up or membership function - and is no more than three pages; 1 point if it is one to three pages, but serves a dual function)

Maximum possible points: 3

2. Does your agreement have a descriptive title that includes one or more of these phrases: "Waiver of Liability," "Release of Liability," "Assumption of Risk," or "Indemnification" or "Indemnity"? (3 points; 0 points if the title includes "Sign-up Sheet," "Registration," "Application," "Membership Contract" or "Entry Blank")

Maximum possible points: 3

3. Is the exculpatory language conspicuous? (3 points if such language is emphasized by the use of underline, bold, all upper-case letters, italics or color)

Maximum possible points: 3

4. Is the agreement print large enough to be easily read by the signer? (2 points if the print is 10-points or larger and the exculpatory language is no smaller than the remainder of the agreement)

Maximum possible points: 2

5. Is the agreement written in language that should be easily understood by the intended reader? (3 points if the language does not contain a lot of "legalese." It should consist primarily of everyday, common language, with an explanation for unfamiliar legal terms)

Maximum possible points: 3

6. Is the agreement presented in an easily readable format? (2 points if there are both subheads before each section of the agreement and paragraphs are separated by a space; 1 if only one of these criteria is met)

Maximum possible points: 2

Maximum possible points in section: 16

Assumption of Risk section
7. Is there a distinct Assumption of Risk section relating to inherent risks of the activity that is clearly separated from the other parts (e.g., waiver of negligence) of the agreement? (4 points if a distinct section with a subhead exists; 3 points if no subhead is used)

Maximum possible points: 4

8. Does this section describe the nature of the activity in terms of how vigorous it is, fitness level required and the unpleasant aspects of the activity? (3 points if all three of these are included; 2 points if two are included)

Maximum possible points: 3

9. Does this section list some inherent risks of the activity, including common minor events, some possible serious events and possible catastrophic events that could occur? (3 points if all three types of events are listed; 2 points if two are included)
Maximum possible points: 3

10. Does the Assumption of Risk section list the possible consequences of the inherent risks (e.g., minor: scrapes or bruises; serious: broken bones or concussion; or catastrophic: death or paralysis)? (3 points if all three types of consequences are listed; 2 points if two are included)

Maximum possible points: 3

11. Do your lists of inherent risks and their consequences contain phrases such as "Some of the risks are" or "includes, but not limited to"? (3 points if such language is included)

Maximum possible points: 3

12. Does this section conclude with an affirmation by the signer that he or she 1) knows the inherent risks of the activity, 2) understands those risks, 3) appreciates those risks and 4) agrees to assume responsibility for those risks? (3 points if all four of these are included; 2 points if two or three are included)

Maximum possible points: 3

Maximum possible points in section: 19

Waiver of Negligence section
13. Is there a distinct section that includes a waiver of liability in the event of provider negligence? This must be clearly separated from the other parts of the agreement. (4 points if a distinct section exists)

Maximum possible points: 4

14. Does the exculpatory language include the phrase "In consideration of"? (3 points if the phrase, or similar, is included)

Maximum possible points: 3

15. Does the exculpatory language include the phrase "I hereby release ... from any and all claims"? (3 points if the phrase, or similar, is included)

Maximum possible points: 3

16. Does the exculpatory language include the word "negligence"? (4 points for the phrase "ordinary negligence of the provider"; 2 points if the word "negligence" is included)

Maximum possible points: 4

17. Does the exculpatory language state that the release is on behalf of the signer, spouse, heirs, administrators and assigns? (3 points if all five parties are listed; 2 points if three or four are listed)

Maximum possible points: 3

18. Does the exculpatory language list the parties that are intended to be protected by the agreement (e.g., corporate entity [by name], management, employees, volunteers, agents, sponsors, independent contractors, insurance carrier and equipment suppliers)? (3 points if five or more of these are listed; 2 points if three or four are listed)

Maximum possible points: 3

19. Is the language of this section broad enough to include all phases of participation, warm-ups, use of equipment, use of facility (including shower, locker room, sidewalks and parking lot), instruction and supervision? (3 points for addressing at least three of these items)

Maximum possible points: 3

20. Does the agreement include language that defines the duration of the agreement (e.g., "which may occur in present or future participation," "for the duration of the event," "for the duration of membership," "during this or all subsequent participation")? (3 points if an indication of duration is included)

Maximum possible points: 3

Maximum possible points in section: 26

Indemnification section
21. Is there a distinct indemnification section that is clearly separated from the other parts of the agreement? (3 points if a distinct section exists)

Maximum possible points: 3

22. Does the language include phrases such as "agrees to indemnify," "reimburse," "defend," "hold harmless," "save harmless"? (3 points if four or more of these five terms are used; 2 points if three are used)

Maximum possible points: 3

23. Does the language specifically include legal costs, attorney fees, court costs and investigative costs? (3 points if at least three of these four are named)

Maximum possible points: 3

24. Does the indemnity section provide that the signer indemnify against 1) claims made by the participant, parent or others arising out of an injury to the participant, and 2) claims of co-participants, rescuers and others arising from the conduct of the participant during participation? (3 points if both are addressed; 2 points if only one is addressed)

Maximum possible points: 3

Maximum possible points in section: 12

Other legal considerations
25. Does the agreement include a severability clause stating that if any part of the agreement is deemed to be void, this will have no effect on the remainder of the agreement? (2 points if included)

Maximum possible points: 2

26. Does the agreement include language specifying the venue, jurisdiction and applicable state law? (2 points if two or more are included)

Maximum possible points: 2

27. Does the agreement include a covenant not to sue in the event of injury or loss? (2 points if included)

Maximum possible points: 2

28. Does the agreement include language by which the signer agrees to submit any claims to binding arbitration? (2 points if included)

Maximum possible points: 2

29. Does the agreement include an integration clause by which the signer affirms that the agreement supersedes any and all previous oral or written promises or agreements? (2 points if included)

Maximum possible points: 2

Maximum possible points in section: 10

Health and safety affirmations
30. Does the agreement have affirmations regarding health status (e.g., affirms no health problems that preclude participation; affirms no asthma, diabetes, epilepsy or heart problems; affirms he or she has skill and fitness level to participate safely)? (2 points if two or more of these are addressed)

Maximum possible points: 2

31. Does the agreement contain an authorization for emergency medical care (e.g., grants permission for first aid, CPR and AEDs; authorizes emergency transport; authorizes sharing medical information with medical personnel; assumes all costs involved)? (2 points if three or more of these are addressed)

Maximum possible points: 2

32. Does the release contain an agreement to follow all safety rules and instructions (e.g., agrees to wear required safety equipment; agrees to follow safety rules of the activity, management and instructor; agrees to inform management or instructor of conduct or a condition that might endanger self or others)? (2 points if two or more of these are addressed)

Maximum possible points: 2

Maximum possible points in section: 6

Concluding statement
33. Does the agreement conclude with a statement in which the signer affirms having read and understood the agreement? (2 points if both are addressed)

Maximum possible points: 2

34. Does the concluding statement include an affirmation that the signer understands that he or she is relinquishing substantial legal rights, including the right of financial recovery for injury, whether the injury results from the inherent risks of the activity or from the ordinary negligence of the provider? (2 points if right of recovery, inherent risks and ordinary negligence of provider are addressed; 1 point if one is addressed)

Maximum possible points: 2

35. Does the concluding statement include an affirmation that the signer is voluntarily participating in the activity, and is voluntarily signing the agreement with the full intent of releasing the provider of liability for injury or loss due to the inherent risks of the activity or due to the ordinary negligence of the provider? (3 points if voluntary participation, voluntary signing and intent are addressed; 2 points if two are addressed)

Maximum possible points: 3

36. Does the signature immediately follow the concluding statement? (2 points if it does)

Maximum possible points: 2

37. Does the signature area include space for the signature, the printed name of the participant, the date, and the name and phone number of an emergency contact person? (2 points if two of the three are included)

Maximum possible points: 2

Maximum possible points in section: 11

Total possible points for all sections: 100

Waivers making the grade

You might assume that the next logical step is to assign a grade to your score, just as in a class. In this case, however, such a procedure would be inappropriate, as well as misleading, because a waiver might score a 95, but be missing one or two points that might be considered crucial by a court in your particular state. The total points earned simply indicate how many of the listed criteria are met - but the importance of each criterion varies from state to state. What you can say is that the higher the score earned, the more complete the waiver is, and the broader the protection gained (legally and financially).

This evaluation form was developed from a study of state statutes and from court rulings in more than 900 waiver cases throughout the U.S. It includes the criteria that seem to be most important when a waiver is challenged. A score of 90 to 100 would indicate a good, broad waiver that encompasses many avenues of protection. However, even a waiver scoring 100 might not be enforced by a particular court or in a particular state, since that court or state might require a criterion that is not addressed in this evaluation form or in your waiver.

If the waiver receives a score in the 70 to 90 range, it is probably an above-average waiver. Most waivers, including most waivers that are enforced, do not meet all of the criteria listed on this evaluation form; however, the more criteria met, the better the odds that the waiver will be upheld in a court of law.

It is important to remember that there is no perfect formula for a perfect waiver. The requirements vary somewhat from state to state. In some states, the public policy favors waivers and the courts are quite lenient in enforcing them - often enforcing what would be considered a poor waiver that would not be enforced in a strict state. In other states, the courts do not favor waivers and have stringent requirements for enforcement. It is not unusual for a well-written waiver in a strict state such as Indiana, New York or Pennsylvania to fail when challenged in court because of one missing criterion or an ambiguously worded phrase. On the other hand, it is not uncommon for a brief, poorly written waiver to be enforced in a lenient state such as Georgia, Tennessee or Ohio.

Since there is no foolproof waiver, you might ask, "Why bother?" The answer is simple. A waiver can protect an individual or business from liability for negligence, and that can mean the difference in a victory in court (or having the case dismissed prior to trial) and a $2 million judgment. Since a waiver can provide low-cost liability protection for an individual or business, doesn't it make sense to develop and use the best waiver possible in order to enhance the likelihood of that protection?

Recommendations

No business should operate without three risk-management tools: 1) liability insurance, 2) a good liability waiver and 3) an ongoing risk-management program.

Learn as much as you can about liability waivers. Attend sessions on waivers and risk management at professional conferences, read articles and talk with experts in the area. Do not depend solely on the criteria suggested in this article. Of necessity, these waiver evaluation questions include only some of the criteria used in evaluating waivers. A resource that includes much more information on waivers is a copy of Waivers &Releases of Liability, Sixth Edition (by Doyice J. Cotten).

Always employ the help of a competent attorney in your state - preferably one who has experience with both waivers and your type of business. You may take one of two approaches: 1) Learn all you can about waivers and then write your own waiver using this evaluation form and Waivers &Releases of Liability as a guide. Then, have your attorney examine it and make any modifications appropriate to your state. This is the most economical approach, because it involves less billable time by the attorney. 2) Have your attorney write a waiver for your business. Then, use this evaluation form and Waivers &Releases of Liability to evaluate the waiver. If the waiver seems to be missing some of the criteria presented in this article, do not be afraid to question your attorney about it - you are paying good money for it, and you want the protection for which you are paying. Remember, just because a waiver is written by an attorney does not mean it will be effective. This may be one of the few they have written, and the odds are good that they are not very familiar with waiver case law.

Make sure you and your staff administer the waiver in a fair way, allowing the signer time to read, explaining the agreement, answering questions and not discounting the importance of the agreement. Educate your staff on how to administer it properly. Develop a system to retain the agreements, to store the agreements in a safe place and to be able to easily retrieve the agreements when they are needed. Finally, review the waiver periodically - particularly as changes occur in your facility or program of activities.