Q: I understand that our agency is liable for its own negligence, such as forgetting to issue a ticket that the client requested until after the fare increases or failing to warn about destination dangers that the client does not know about. I also know that some businesses, such as health clubs, horseback tour operators and companies that rent personal watercraft, require customers to sign waivers stating that the customer waives all such claims of negligence. Are such waivers legally enforceable? If so, why wouldn't we want to add such a waiver of our negligence to our own standard paper or online disclaimer, so that we are no longer liable for our own negligence?
A: The laws governing negligence and contract issues such as disclaimers, waivers and releases are based on court precedents and are therefore a bit different in each state. However, it is safe to generalize that most courts will uphold waivers of negligence if the waiver does not present any of the following frailties.
• First, courts scrutinize these waivers carefully to look for grounds that will invalidate them, such as ambiguity or lack of specificity. For example, one court held that a waiver of "all liability" was not sufficient because it did not specifically state that the consumer was agreeing to waiver all claims for the merchant's negligence.
• Second, courts will invalidate waivers that are not conspicuous. Unlike ordinary disclaimers that merely note that you are not liable for suppliers' negligence or events beyond your control, you cannot place the waiver of your own negligence in fine print in an itinerary, brochure or Web page.
Ideally, the waiver should be in boldface or upper-case letters. It should be part of a disclaimer agreement that is not only signed but also called to the client's attention during the sales process.
For corporate travel, you could add the waiver of negligence to your corporate-account agreement. Alternatively you could put it on the traveler profile form, if you think travelers will sign it.
For online booking, a waiver of your agency's negligence would probably be upheld if it were conspicuous and the traveler had to click "I Agree." You would also need to keep a record of who clicked and when they did so.
• Third, courts will not uphold a waiver of "gross negligence," and your waiver should not even mention the term. The quoted term means "conscious indifference to the rights of others despite an actual, subjective awareness of the risk involved," as opposed to ordinary mistakes in the course of business.
For most corporate and leisure agencies, I don't necessarily recommend that you add a waiver of your own negligence to your standard disclaimer because I believe that the potential business that you will lose may well exceed the gain from insulating your agency from liability for your own mistakes. Most such claims are settled for hundreds or a few thousand dollars, while requiring the waiver might cost you tens of thousands of dollars in lost sales every year.
However, I do recommend using such a waiver if you specialize in travel that could result in suits for hundreds of thousands or millions of dollars, such as medical, sports or adventure travel. In each case, the waiver should be tailored to your specialty by a knowledgeable attorney.
Mark Pestronk is a Washington-based lawyer specializing in travel law. To submit a question for Legal Briefs, email him at [email protected].