Tip
of the Month - August 2003
PARTICIPANT
WAIVERS:
THE GOOD, THE BAD AND THE UGLY
Waivers and other
liability shields can be effective
risk management tools, but they must
be carefully drafted and used
appropriately. Since state courts
interpret liability shields and decide
whether to uphold them, a nonprofit
that uses such documents should be
familiar with the standard of scrutiny
applied to waivers by its states’
courts.
A waiver offers a legal
and psychological deterrent for the
participant to pursue legal actions.
If you are considering the use of
contractual risk transfer mechanisms
such as a participant waiver, consult
an experienced attorney for advice on
your particular circumstances.
While
state court interpretations differ,
here are some commonly regarded
elements of effective waivers.
Elements of an
Effective Waiver
-
The document is
titled properly (“Waiver and
Release” is appropriate;
“Sign-Up Sheet” is not)
-
The language in
the document is clear and
understandable (no needless
legalese!)
-
The contract
references “consideration,” an
essential element for an
enforceable contract: “In
consideration of my
participation...”
-
The waiver is
specific as to who is protected:
make certain all parties are
listed
-
The document
contains a parental signature line
if the participant is a minor
-
The waiver
specifies other releasing parties
(e.g., heirs, assigns, etc.)
-
The waiver does
not contain any untrue or
fraudulent statements (e.g. “You
are not covered by our
insurance.”)
-
The waiver is
easy to read (The text should be
larger than a classified ad in the
newspaper)
-
Release
language is conspicuous
-
Signature is
near the release language
-
Refers to
negligence
-
Many state
require reference to negligence
-
Many prohibit
release for gross negligence
-
The waiver
makes it clear that participation
in the activity is voluntary
-
Assumption of
risk only when voluntary
-
Signer assumes
risk of participation
-
Waiver is
specific about the risks of the
activity.
To
read more about waivers and other
important legal issues in the risk
management field, see new information
from the Nonprofit Risk Management
Center, www.nonprofitrisk.org.
View
Past Tips of the Month
May
2004 - One
Million Minnesotans Can See Your Form
990
April
2004 - Avoid
Unexpected Cost of Directors,
Officers, and Organizational Liability
March
2004 - Strategies
for Reducing Operating Costs
February
2004 - What
Can Nonprofits Due During an Election
Cycle
January
2004 - Celebrate
Your Nonprofit
November
2003 -Get
Your Board on Board
October 2003- Take
a Walk-About for Safety
September
2003- Exit
Interviews-Learn from those who Leave
August
2003 - Participant
Waivers: The Good the Bad and the Ugly
July 2003 - Practical
Tips for Reference Checking
June 2003 - Evaluating
Your Insurance Professional
May 2003 - Supervising
Volunteers
April 2003 - Protect
Your Assets with Sound Internal
Controls
March
2003
- Teaching
Computer Users to Surf Safely
February
2003 -
Involve
Clients in Protecting Their Own Safety
January
2003- Managing
the Risk of Board Discontent
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