It is only natural for an attorney to try to minimise his client’s (a company’s) liability to his customers, with a clause exempting the liability that it would otherwise be forced to accept. It is therefor that all adventure parks, hotels, guesthouses and B & B’s have a clause like this incorporated in their registration forms. Sometimes these forms do not give maximum protection but conceal the contractual term in an unlikely part of the contract. Obviously, the law cannot just stand aside and allow this to happen.

There is a very recent court case, Naidoo v Birchwood Hotel, which was heard in the South Gauteng High Court where the facts of the case were very similar to the facts above. In this case, the learned judge Heaton Nicholls emphasised two very important legal principles:

• “Public policy in South Africa, which includes the notions of fairness, justice and reasonableness, would prevent the enforcement of a contractual term (such as an indemnity clause) if its enforcement would be unjust or unfair.
• The court could not let blind reliance on the principal of freedom of contract override the need to ensure that contracting parties must have access to courts, if they so need.”

In the above-mentioned case the judge found that to deny the plaintiff (who was seriously injured) judicial redress for injuries that he suffered, which resulted from the negligent conduct of the hotel (guesthouse / B & B), went against the notions of justice and fairness. The Judge ordered the Hotel to pay the Plaintiff’s damages.

Exemption clauses are not just found in small print on forms. Many hotels, guesthouses, B & B’s and public places like an adventure park or the beach even have very big prominent signs displaying their indemnity clause.

The Constitutional Court has found that these kinds of exemption clauses (even when entered into freely, voluntary and by consenting parties) that exclude liability for bodily harm, have the effect of denying the claimant judicial redress and it would not pass our constitutional scrutiny. These clauses would go against the values enshrined in our constitution. The clause would be contrary to public policy and unenforceable. The court went on to mention that whether a clause is enforceable would always depend on what is fair and reasonable in the circumstances.

Another aspect to consider when looking at indemnity clauses is the Consumer Protection Act. Section 48(1) provides that a supplier must not require a consumer to waive any liability of the supplier, on terms that are unfair, unreasonable or unjust. Simply put, if a term in a contract is unfair, unreasonable or unjust it will not be enforceable.

To guests and visitors of hotels, guest houses, B & B’s, and public places: If you have suffered any injury or loss, because of the negligence of such places, consult an attorney on claiming damages – you have rights, whatever indemnity form you may have signed. To the owners and insurers of hotels, guest houses, B & B’s, and public places: your level of risk has increased – secure legal advice on how to construct your indemnity clause.

Reference List:

• The Law of Contracts in South Africa, September 2012, 2^nd edition, D Hutchison, C-J Pretorius, S Eiselen, T Floyd, and L Hawthorne
• Naidoo v Birchwood Hotel 2012 (6) SA 170 (GSJ)
• The Consumer Protection Act 68 of 2008