Liability Release Forms/Assumption of Risk
by Charles Van Gorder, P.C.

Even if you prevail in the long run, involvement in a 'Lawsuit is stressful, time-consuming and expensive. The key to avoiding lawsuit is to run a safe program, and to prevent accidents as much as possible through an aggressive risk management program. If and when a serious accident does occur, emphasis needs to be placed on keeping frivolous claims out of the legal system. The information that follows illustrates some methods by which outfitters may be able to keep lawsuits from being filed in the first place, or avoid a trial by winning a motion for summary -judgment.

Liability Release Forms
Under the law of many states, one defense to a negligence claim is the injured party's assumption of the risks inherent in a particular activity, such as rafting or mountaineering. If someone participates in such activities, he or she may recognize there is a chance of injury and therefore "assume the risk" of such an injury. If this defense is applicable to a particular claim for damages, it could completely defeat the claim or reduce the amount of damages that might be recovered.

In applying the assumption of risk defense, a court will consider many factors, including whether the injured party knew of the specific risks that caused the injury, and whether he or she expressly chose to voluntarily participate in the activity despite knowledge of those risks. The use of an appropriate written liability release or acknowledgment of risk form is one way to show that the injured party was aware of specified risks, and chose to participate despite the knowledge of those risks. Courts in many states have ruled that a signed release form may completely bar a claim by an injured party. This is a matter of state law, and you should consult your own legal advisor about the status of the law in your state.

A liability release should specify all of the risks to be assumed by a participant in an outdoor recreation. Participants may be able to release the outfitter and guide from liability resulting from naturally occurring conditions, equipment failure, actions of other participants, and even negligence on the part of the outfitter or guide in conducting the activity. Liability resulting from gross negligence or recklessness on the part of a sponsor usually cannot be waived. It is important that you consult an attorney experienced in the recreational industry when preparing a liability release form. Your release form must be tailored to the law of your state in order to enhance the chances that it will be upheld if challenged in court.

There is a tension between including too many specific risks and possibly scaring away potential clients, and not including a specific risk that a client might not otherwise recognize (such as contracting giardia through ingesting water in the course of a water fight while rafting). Some attorneys are concerned that when you include an extensive list of risks, if a client is injured through a risk not listed, they will be held not to have assumed that particular risk. There is no right or wrong answer to this question. Ultimately, it is up to you to determine how inclusive you are willing to make your release form. Once a release form is drafted, you should consult with your insurer to determine if the listing of risks in your release form is acceptable to them.

A complete release form will not only address the inherent risk; in the relevant outdoor activity, but will also address other concerns such as applicable state law and the award of attorney's fees in the event of an unsuccessful attempt to challenge to validity of the release. A release should include a severability clause so that the entire release will not be found void if any one portion is invalid. The release needs to name all of the parties that are to be released from liability, and should state that it applies to the participant and his or her parents, heirs, assigns, personal representative and estate. A sample liability release form is attached as Appendix B.

In reviewing your own liability release form, one that has been prepared for you or one that another outfitter uses, a check list-may help you spot specific provisions that may be missing. Attached as Appendix C is a Sample Liability Release Form Check List. Following are provisions you should specifically look for:

Parties Released
Make sure that all of the appropriate parties are specifically named in your release form. This will include the principal company (and its principals, owners, officers, directors, shareholders, members as appropriate) and all of the others that may be involved in the trip (including agents and volunteer assistants). If your trips have commercial sponsors and advertisers or are undertaken in cooperation with another venture such as a lodge, booking agency or cruise line, these entities may want to be released as well. Landowners and governmental agencies may also seek to be released as well.

Contract Formation
The agreement between you and your clients is a contract. As such, each party to the contract must give something ("consideration") when entering the contract. For the outfitter, it is the monies paid by the client; for the client, it is the opportunity they receive to participate in the particular outdoor activity. This requirement is often documented by a phrase such as "In consideration for the services provided by Outfitter. It is also important that the release clearly state the client's participation is voluntary.

Risks Released
As mentioned above, there is substantial debate over how much to detail the risks involved in your particular activity. At the least, you should use the term "all risks" and state that the risks to be encountered "include but are not limited to" the enumerated risks. Unless you are operating in an area where you may be prohibited from doing so, specifically state that negligence (or "guide error") is one of the risks being assumed by the (client. It is recommended that you also spell out the possible results of incurring such deaths, such a death and serious bodily injury (including paralysis). Including these possible outcomes will help reinforce the concept that the trip and its inherent risks are not to be taken lightly.

Participant Representations
Many outfitters choose to include in their release form representations by clients that they are physically able to meet the challenges of participation in the outfitter's activities and do not have health problems that limit their ability to fully participate. The problem is that your clients may not really be aware of the physical demands of your trip and whether they are up to meeting the challenge of participation. In the information provided by the client, you may want to request the name and telephone number of an emergency contact.

Exculpatory Language
It is critical that client be aware of and know exactly what it is they are being asked to sign. The liability release should be clearly labeled as such, and the language containing the actual release should be in bold type that cannot be missed. The release language must be in plain English that can be readily understood by the lay person. Finally, the exculpatory language should be binding not only on the client, but also on his or her spouse and other heirs under the law.

Review/Execution
The release should state in clear, boldfaced language that the client has had an adequate opportunity to review the release form, and state that he or she has read and understands the release form. While you can't force clients to carefully read a release form, you can require them to sign a statement saying they have done so.

Legal Actions
Often overlooked in release forms is language setting limitations on a client's ability to sue the outfitter. Parties to a contract can agree to certain limitations, such as where a lawsuit must be filed (in the county where the outfitter is headquartered - perhaps a sympathetic jury) and which state's law will apply (for example, the law of a state that up-holds the validity of liability release forms). You may also want to provide a provision stating that the prevailing party will be awarded their legal costs and attorney's fees. This can be a strong disincentive to filing a frivolous lawsuit in the hope that an insurance company will pay a significant settlement rather than contest a lawsuit. A critical point can be the inclusion of a "severability clause" stating that if any one part of the release form is found to be invalid, the remainder shall be enforceable. Without such a clause, a release form may be thrown out in its entirety if any one provision is held unenforceable. Finally, some outfitters include a provision stating that any claims must be submitted to mediation or binding arbitration rather than subject to a lengthy jury or bench trial.

Trip Specifics
Finally, many release forms have space to insert the date and location of the trips, the nature of the activities involved and names of the guides leading the trip.

Preparing the appropriate release form is only the first step in protecting yourself or your organization from liability. A release form must also be used in an appropriate manner in order to be effective. Participants must have an adequate opportunity to read and understand the release form. A participant must also have a realistic choice of not participating in all or a portion of the subject activity, and of receiving a refund of any fees paid if he or she does not want to sign the release. The release should state that the participant has had a full opportunity to read and understand the release, and that he or she understands that signing the release may result in the loss of certain legal rights in the event of injury. Minors who are unwilling to participate in an activity should not be forced to do so, and should be protected from peer pressure in the event they elect to withdraw from a particular activity.

Although perhaps not required by law, it may be a good practice to require a client's signature be notarized if they are executing the release form before arriving at your staging area. Where clients execute release form on-site, you could require the signature of a witness whenever a client signs a liability release form. In this way, you have at least one additional person that could testify the client had the opportunity to fully read the release form and actually signed it. You also want to institute a procedure whereby you can be sure every client has signed a release. You might require each client to hand a staff member a signed release form before being given some piece of required equipment, such as a wet suit. Have your staff review the forms to be sure they all have been properly signed, and count them to be sure there are the same number of signed forms as there are clients.

It is a good practice to state right in your promotional material that all participants will be required to sign a release form before they will be permitted to participate in any activity v7ith your company. Consider including a statement that a copy of the release form will be provided upon request. If you send written materials to your clients in advance of your trip, include a copy of the release form so they will see what they will be asked to sign. Do not ask your clients to sign the release form at the last minute. If release forms are to filled out and signed at your staging area, make it the first thing they have to do! Remember, the greater investment your clients have made in taking your trip, either in cost or time expended to reach your staging area, the better their argument can be that they really had no choice other than to sign the release form because they were already committed. There must be a realistic opportunity to say no to signing a liability release form.

Acknowledgment of Risks Forms
There are a number of governmental agencies (including the National Park Service and the U.S. Forest Service) whose operational guidelines prohibit outfitters from using liability release forms containing language whereby clients waive their right to sue for injuries suffered while participating in a commercial recreational activity on public land. They also prohibit language excusing an outfitter from the results of any negligent behavior. Admittedly, these polices are not uniformly enforced throughout the country, and you need to know the policy adhered to in your areas of operation.

Local federal personnel often require outfitters to submit their release forms for review prior to being issued a permit to operate on federal lands. Instead of using standard liability release forms, many federal agencies have approved a "Visitor's Acknowledgment of Risk" form. A sample Visitor's Acknowledgment of Risk ("VAR") form is attached to this material as Appendix D. While perhaps not as tightly worded as a standard release form, this document still serves to show that a client was advised of and acknowledged the risks inherent in the subject activity. This acknowledgment can still be an effective defense in the event of a later claim for damages. Federal authorities may also frown on attempts to assume the risk of negligence of the part of the outfitter, so many forms utilize the term "guide error" instead.

Implied Assumption of the Risk
In the event a liability release or visitor's acknowledgement of risk form is unavailable or unenforceable for some reason, not all is lost! Written release forms are examples of the application of the doctrine of express assumption of risk there is a document specifically showing the client was informed of and accepted the risks inherent in the particular activity.

Courts in many states have held, however, that even in the absence of a signed release form, a client's decision to voluntarily participate in a specific recreational activity may constitute an acknowledgment of, and an assumption of, those risks known to be inherent in that activity. This is often referred to as implied assumption of risk, whereby the mere participation in an inherently risky activity is considered to be an acceptance by the participant of the inherent risks. Since this form of assumption of risk is not necessarily dependent upon the signing of a contract, it can be applied where a release form was not signed.

One key consideration in the successful application of an implied assumption of risk defense is demonstrating the injured party was aware of, and fully appreciated the nature and severity of, t-he risks inherent in the activity. It can certainly be argued that falling off a stumbling horse, or getting thrown into the water when going through Class III rapids, are risks that would be evident to any participant. Other less obvious risks can be reviewed as a part of a pre-trip safety talk, as discussed later in this material. An important key consideration in applying implied assumption of risk is to be sure participants are made aware of the risks inherent in participating in any given activity.

Indemnification Agreements
The documents discussed to this point in this section are used to defeat or limit liability of an outfitter in the event a client gets injured. A different approach may be taken, however, through the use of indemnification agreements. These agreements are directed at shifting where the ultimate financial burden will lie in the event a client is awarded a judgment for damages suffered on a trip. Through the use of an indemnification agreement, the outfitter can require another party to indemnify the outfitter's company against and financial loss due to a client's injury. A sample Indemnification Agreement is attached to this material as Appendix E.

This approach may be used in the event of a minor's participation (see discussion below), or where there is another entity- working in conjunction with the outfitter, such as a land owner, corporate sponsor or an educational/institutional client. Such an agreement involves yet another potential "deep pocket" in settlement discussions, and may help move the parties toward a financial settlement. One major drawback, however, is that the outfitter may have to start yet another lawsuit to enforce the terms of the indemnification agreement if there is not voluntary participation. Another limitation is that any such agreement will be worthless if the other party does not have the financial resources to fulfill its obligations under the agreement. Thus, an indemnification agreement is another tool to protect an outfitter, but is will not guarantee financial protection.

Minors and Liability Release Forms
When people discuss kids and recreational programs, the .topics of injury and potential liability always arise. If a child is hurt, parents may look to someone else to bear the responsibility for injuries and damages. This could be an effort to assign blame to someone else or to obtain a monetary award or settlement for medical expenses and "pain and suffering."

The involvement of minors in outdoor recreational programs introduces many special considerations. If a child is seriously injured, not only can the child sue for medical expenses and "pain and suffering," but the parents and other members of the child's immediate family can sue for their own emotional suffering and "loss of companionship." In many states, an injured person must file a lawsuit within three years of the injury. where the injured person is a minor, that three year period may not start to run until the child reaches the age of majority (usually eighteen years old).

The law is quite unsettled over whether releases can be enforced against minors. Courts in some states have ruled minors do not have the legal capacity to sign releases for themselves; therefore any releases they sign are unenforceable. If a minor cannot sign a release on his or her own self, is a release signed by a parent effective to bar a minor's claim? Some states have ruled that parents can sign releases on behalf of their children, while other states have ruled parents have no right to sign away the legal rights of their children. Note that where a release signed by a parent is not binding on a child, such a release may still be effective to bar claims that might otherwise be brought by the parent, on behalf of either the parent or the child. Where a state does enforce releases signed by a parent, do both parents have to sign the release? Once again, you need to know the status of the law in your state! In some states, a parent may not be able to sign on behalf of the other parent, especially if the parents are divorced. Attention must also be paid to whether the applicable age of majority is 18 or 21 years of age.

If release forms signed by minors are unenforceable in your state, not all is lost! Written release forms often contain an express acknowledgment of the specific risks involved in the particular recreational activity. As with adults discussed above, a minor's signature on a release form containing such a listing of risks, along with the minor's decision to voluntarily participate in the recreational activity despite his or her knowledge of those risks, may constitute an acknowledgment of and an implied assumption of those risks. Since this form of assumption of risk is not necessarily dependent upon the signing of a contract, it can be applied to minors. The key consideration in the successful application of an implied assumption of risk defense is demonstrating the injured party was aware of, and fully appreciated the nature and severity of, the risks inherent in the activity.

Another manner in which to bolster an assumption of risk defense is to have every minor participant read and sign an acknowledgment of risk form. If this is required of a minor participant, his or her signature can be used to show he or she considered and understood the risks of participating in the particular activity. An example of an acknowledgment of risk form for use by minors is attached to this material as Appendix F.

Another key consideration in applying implied assumption of risk to minors is to be sure they are well educated in the nature of the activity, including its inherent risks, and are carefully exposed to such inherent risks, participating in activities that slowly increase in difficulty and degree of inherent risk. Ensure that each minor understands the risks of participating in different levels of the specific outdoor activity. ]'jet the kids have the principal responsibility in deciding when they are ready to progress to the next level of difficulty. If you can show your kids are fully advised as to the inherent risks of the specific activity, and have been brought along carefully so that they appreciate the nature and severity of those risks, you stand a better chance of a court deciding that the child assumed the risks involved in that activity and therefore waived the potential responsibility of the sponsor.

A relatively new concept for limiting potential liability when minors participate in an activity with inherent risks is for the Parents or guardians to agree to indemnify the outfitter (and its employees and volunteers) in the event a minor, or someone on a minor's behalf, successfully sues the sponsor for damages. Thus, if there is an award on behalf on the minor, the sponsor can seek reimbursement from the parents or guardians. A sample indemnification agreement for the participation of minors, to be used with a standard liability release form, is attached to this material as Appendix G.

Indemnification agreements may not be useful in all cases. If the parents or guardians have minimal financial resources, the sponsor will have a hard time extracting sufficient funds to cover a major financial award to the minor. where an award is likely to be relatively modest, as with a relatively minor inDu3:,,, the parents or guardians will often have sufficient resources to pay any indemnification award. While an indemnification Agreement may not stop a lawsuit on behalf of a minor in the case of a catastrophic injury, it may discourage the filing of nuisance lawsuits on behalf of minors.

There are few court cases involving challenges to the validity of such agreements. It is possible that state courts may decide such agreements are contrary to public policy and therefore invalid (and a trial court in at least one state has reportedly done so). Until a court in your state rules on this issue, it makes sense to use indemnification agreements in an attempt to limit potential liability.