It might seem like having any generic contract or liability release will cover your needs, but not all of them are legal for equestrian businesses—and the results of using the wrong one can be devastating.
By Kristin Pitzer
Striking a business deal is a tale as old as time, but in a society that’s increasingly litigious, NRHA Professionals need to do more than have a handshake and verbal agreement with their clients. To protect yourself, it’s best to have a contract that lays out the terms for the services to be provided and includes a liability release.
Jordan Willette, an attorney in Phoenix, Arizona, addressed the following five broad problems, presented with fictitious trainers, that you might experience when constructing a contract. Remember that laws vary by state. Consult your own state laws, ideally with an equine attorney, to ensure that you’re covered.
Part 1: The DIY Contract and ‘Inherent Risk’ Signs
Part 2: The Assumptive Contract and the Form Document
Part 3: The Termination Clause
The DIY Contract
The situation: Rather than working with an attorney to obtain a legal liability release to use for her clients, Homemade Hannah created her own. It mentions she’ll not be held responsible in the event of a personal injury or death on her property. Hannah has used it for years, and even though she doesn’t know 100% whether it’s legal, she believes having her clients sign something will protect her in the event of a lawsuit.
The problem: If the language used in a liability release isn’t specific enough, Hannah might not actually be protected from liability. Simply creating a contract for clients to sign, without ensuring that the proper terminology is used, could set her up for an expensive legal battle.
“One of my colleagues had an exact situation like this,” Willette said. “The trainer had a liability release, but the release was inadequate under the state law, and a lawyer never reviewed it. The case ended up going to trial, and the approximate legal fees were $90,000, plus damages. All of this resulted from inadequate language in the liability release.”
The solution: Be as specific as possible in contracts and liability releases, and ensure that the document has the right language according to state law. Additionally, liability releases and contracts should address not only people who enter the property, but also horses. Freak accidents can and do happen.
“I always look at three different types of issues,” Willette said about determining the enforceability of a release. “I want the contract to be specific and explain how horses are considered inherently dangerous animals and can be unpredictable. The contract must have exculpatory language, if permitted by state law [a provision that relieves one party of liability if damages are caused during the term of the contract]. Secondly, I want the parties signing the release to be identified and their authority to sign set forth. For example, you might not be protected if a parent signed a release for their child, but did not sign a release for themselves. And, finally, you want very clear identification of what’s being covered—trainer, ranch, clients, etc.—and what isn’t.”
The ‘Inherent Risks’ Sign
The situation: Risky Ralph has a sign posted at the entrance to his barn telling visitors that equine professionals aren’t liable for the death or injury of an equestrian participant if an accident arises from the risks inherent to equine activities. He believes he’s protected simply by making this notice visible and doesn’t think he needs to collect liability waivers.
The problem: Depending on Ralph’s state’s laws, this sign may or may not be enforceable on its own, which means that even though he has the sign on his property, he may not be protected. He needs more coverage than just telling his clients he’s not liable for the client assuming the risks because they’re working with livestock—that may not hold up in court if someone gets injured or killed on his property.
The solution: Ralph should ensure that his sign has the proper language or legalese for his state, and then he should have a liability release drafted by an attorney and signed by each participant.
“Most states [48] have enacted Equine Liability Acts that protect trainers from liability when their clients engage in horse-related activities,” Willette said. “These states require that these ‘Inherent Risk’ signs be posted on the property. However, some states have additional requirements.
“Contracts and liability releases are designed to be more specific than ‘Inherent Risk’ signs and provide increased protection to the trainer,” Willette continued. “When applicable, you want to include [this exculpatory clause] in a contract, and you want to ensure that you have specific language as to the liability being released. You typically would want to have an attorney review the release to confirm that the language you’re using is enforceable in your state. Some states require the signs to be posted on the property by statute; in others, it’s a suggestion.”
Anyone who comes onto your property should sign the release, Willette added. It may sound extreme, but you could otherwise find yourself unprotected in the middle of a very expensive court case. Additionally, talk to your insurance company to find out exactly what kinds of liability you’re covered for, Willette said.
“If you don’t have the right insurance policies, some things may not be covered because you’re engaged in a business,” Willette said.
Read the rest of this article at the links above.
