Waivers: What Are They And When Are They Used?

Author: Ian Aldridge, Progressive Legal

A waiver might sound like just another piece of paperwork, but for your Australian business, they’re more like a protective shield. Waivers are vital for any business providing goods or services that carry an element of risk to consumers.

The ultimate goal is to stop a customer from saying that they weren’t aware of the risks when they signed up. On this page, we’ll break down what waivers are, why they’re crucial for businesses in Australia, and how to get one tailored to your specific needs.

What is a waiver?

A waiver is a simple yet powerful legal document that allows a person to voluntarily give up specific rights or privileges.

In the context of business, it’s often used to release a company from liability or responsibility for certain risks associated with its goods or services. Essentially, a waiver is your business’s shield against potential legal claims.

When do I need a waiver?

Generally, a waiver is used when certain risks are associated with a business’ goods or services and the business seeks to limit its liability.  

Waivers are commonly used when a business provides dangerous or risky activities, such as extreme sports or recreational activities to customers. These dangerous activities could leave the business exposed to liability if a consumer is injured and makes a claim against the business. Some common businesses where waivers are essential include:

Extreme Sports and Recreational Activities

This includes businesses like skydiving, go-karting, bungee jumping, horse riding, and more.

Medical and Allied Health Practices

Even in the medical field, waivers may be necessary for certain treatments or procedures.

Beauty and Alternative Therapy Providers

If your services involve beauty treatments or alternative therapies, consider using a waiver to mitigate risks.

Adventure Tourism

If your business offers white water rafting, helicopter flights, motorbike racing, scuba diving, or aerobatic flights, a waiver is essential.

It’s crucial to use a waiver to alert the consumer or customer to the nature of the activity, it’s risks and for the individual to waive their right to take legal action against the business.

Essentially, the customer agrees to take responsibility for the risks associated with the activity offered by the business and agrees not to sue the business if they incur injury or harm.  

A waiver could also be used if photos or videos are taken of customers for promotional and marketing purposes to release the business of liability.

What should a waiver contain?

To make sure your waiver effectively protects your business, it should encompass the following:

Waiver in Writing

The waiver should be in writing and be incorporated into the contract with the customer.

Clear Risk Warning

Your waiver should explain the potential risks associated with the activity or service your business provides. It should be easy for the customer to understand what they’re getting into.

Release of Liability

State unequivocally that by signing the waiver, the customer releases your business from any liability related to those risks.

Examples of Non-liability

Specify what your business is not liable for, such as negligence, unforeseen events or loss of personal items and provide specific examples where applicable.

If a business’ negligence also means a breach of a consumer guarantee under the Australian Consumer Law (ACL), then there are very specific provisions on how that may be done.

We’ll discuss this next but generally, if you are able to exclude the consumer guarantees under the ACL, you will also exclude your liability for negligence.

Indemnity Clause in a Waiver

Consider including an indemnity clause, which makes the customer responsible for any damage or loss incurred as a result of using your services.

Explanation of Waiver

Explain how the right or remedy has been ‘waived’ to make it crystal clear. This is in accordance with Agricultural and Rural Finance Pty Ltd v Gardiner [2008] HCA 57.

Timing Matters

As per Alameddine v Glenworth Valley Horse Riding Pty Ltd [2015] NSWCA 219, make sure to provide the waiver at the time of the contract for the risky product or service.

How does a waiver interact with the Australian Consumer Law?

It’s important to note that Australian Consumer Law implies certain warranties into contracts for service providers. While waivers can be powerful, they cannot exclude certain guarantees under the ACL. These guarantees include:

Warranty of Due Care and Skill

Section 60 of the ACL implies that services will be rendered with due care and skill.

Warranty of Fitness for Purpose

Section 61 of the ACL implies that the service will be fit for the intended purpose.

However, there is an exception for suppliers of recreational services under section 139A of the Consumer and Competition Act, 2010 (Cth). You can exclude consumer guarantees for death or personal injury as long as it doesn’t involve reckless conduct.

Key Takeaways

Waivers are essential for businesses in Australia that offer risky services or activities. They protect your business by making customers aware of potential risks and limiting your legal exposure.

Remember, there’s no one-size-fits-all waiver, so it’s crucial to have one tailored to your business.

At Progressive Legal, we specialise in drafting custom waivers for your business. Our experienced commercial lawyers can create a waiver that suits your needs, starting from $850 + GST.

Protect your business today – contact us for a tailored waiver that safeguards your interests and protects your business against risks.

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