You are likely familiar with the many types of indemnities in the events industry, some examples being: contractual clauses that exhibitors must sign; the terms and conditions that delegates must accept when registering to attend a conference; or the signage at a venue stipulating that by entering the building, event attendees are accepting responsibility for certain risks.
Indemnities are a way for event organisers and suppliers to limit their liability should something go wrong. Typically they address the issues of ‘any loss, damage or injuries suffered’ while attending their events and using their services.
In South Africa, organisers and their suppliers have misused indemnities in the past, and structured them in such a way as to exempt themselves from any liability – even in instances of gross negligence. Carefully worded contracts that did this could be upheld in court. However, this is no longer the case. The Consumer Protection Act (CPA) has curtailed this legal freedom by introducing restrictions to what an indemnity can and cannot do.
“The CPA refers to the liability of the supply chain, and has a very broad and encompassing definition of what the supply chain is.” – Advocate Louis Nel
But what does this actually mean? The Planner spoke to Advocate Louis Nel, also known as Louis the Lawyer, to find out what businesses in the events industry should be doing to ensure they are properly protected against the risks inherent to their work.
The whole supply chain can be liable
“The first thing I need to stress is that the CPA refers to the liability of the supply chain, and has a very broad and encompassing definition of what the supply chain is,” says Adv. Nel. This is:
‘The collectivity of all suppliers who directly or indirectly contribute in turn to the ultimate supply of those goods or services to a consumer, whether as a producer, importer, distributor or retailer of goods, or as a service provide’
This means that venues, stand builders, décor companies, caterers, security staff and event sponsors could, for example, be held liable for damages suffered at an event. All of these suppliers need to make sure they have sufficiently fulfilled their responsibilities as outlined by the CPA – and it is not only the event organiser’s responsibility to do this.
Always be transparent about any risks
Secondly, it is important that any risks in attending an event are made evident to potential event attendees. “You cannot simply address these risks in an indemnity and/or waiver clauses in your terms and conditions,” says Adv. Nel. “The CPA requires the supplier to bring all elements of risk to the attention of the consumer at the earliest possible opportunity so that the consumer can make an educated decision (‘receive and comprehend’) as to whether or not to continue with the purchase and/or activity.
“Accordingly the consumer must be advised at the earliest opportunity of any possible risks (Section 49) – such as when the consumer (a) enters into the agreement (e.g. registers for an event); (b) starts engaging in the activity (e.g. attends the event); (c) enters the facility (e.g. walks into the venue); (d) is required to make payment.”
This is especially urgent when these risks are dangerous.
Adv. Nel adds that all communication during this process “must be in plain language, conspicuous and be ‘likely to attract the attention of an ordinarily alert consumer, having regard to the circumstances’.”
Prevention and preparation are also critical
Note that merely warning attendees of any risks is not adequate. You will need to do your best to avoid them, and be prepared to handle them should they happen. “Therefore you should also ensure you have adequate risk management practices, trained staff and insurance,” advises Adv. Nel.
