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Agreements Limiting Liability for Injury

I am considering joining a fitness centre and gym. I have been handed a copy of the agreement they require me to sign, which contains a paragraph releasing them from any liability if I am injured while using their facilities – even if it is their fault. I have asked them to remove the paragraph, but they have refused, although they say the paragraph “would not stand up in court”. What are my rights if I sign the agreement and injure myself at a later date?


If you injure yourself you have no rights against any other person. I presume you mean “What are your rights if the gym injures me?” For example do you have rights to claim compensation if the gym fails to service the cabling of a machine and as a result that machine breaks while you are using it and you become a quadriplegic?


Previously the Trade Practices Act operated to make it impossible for a business to contract out of its obligations to provide services in accordance with the Act. That included a business’s implied duties to provide services to consumers with due care and skill. In 1974 when the Trade Practices Act was brought into existence that was apparently considered an appropriate protection for the interests of consumers. The Act has now been amended to lift that prohibition.


In 2002 the State Government passed the Civil Liability Act, which set out guidelines for how personal injury claims are to be determined and assessed. Included was a provision which allows suppliers of recreational activities (such as gyms) to remove, by agreement, any liability they may have for failing to provide their services with due care and skill. This means that if you have signed such an agreement as you have set out above and the fitness centre provides a below standard service such that you suffer personal injuries you may have no claim for damages.


In some circumstances there may still be some opportunity for an injured person to challenge such a clause if necessary. If the clause is considered not fair or reasonable it may be later removed. Factors to be considered in determining this include the equality of bargaining power and information available to the vulnerable party at the time of the contract. Also if the consumer was induced to enter into the contract by misleading and deceptive actions on the part of the fitness centre staff the contract may be set aside. Comments at the time of the contract such as, “Don’t worry it wont stand up in court,” may be misleading and deceptive. However the process of setting aside such a contract may be expensive and certainly less likely to succeed than previously.


This puts a lot of responsibility onto the consumer. One assumes this change to the law has been designed to reduce insurance premiums for businesses such as fitness centres. It allows the less scrupulous operators to continue to operate possibly to the detriment of consumers and good operators who continue to invest in new and well maintained equipment and proper operating systems. For consumers there is greater responsibility to read and understand contracts and to negotiate terms and conditions that satisfy acceptable personal risk. The only real protection for consumers is to take out your own personal injury insurance.


Rolf Howard is a partner of Owen Hodge Lawyers Hurstville.


There is a great fluctuation in petrol prices in my area and reports now say that petrol prices will be increasing further. Could the government legally stop petrol stations increasing their prices dramatically from day to day?


Our Governments do get involved in setting the prices of some products. For example, in New South Wales the Independent Pricing and Regulatory Tribunal sets prices for water, public transport, electricity and gas. These are products where usually there is a government monopoly and where the Government decides it is in the public interest to regulate prices.


Generally, however, our laws are designed to encourage competition, and that means that prices are left to market forces. Petrol prices fall under this category.


The Trade Practices Act, which is the Act overseen by the Australian Competition and Consumer Commission (“ACCC”), contains laws promoting competition. For instance, it is illegal for competitors within an industry to fix prices; or for suppliers to stipulate at what price goods or services must be sold (suppliers can only give a recommended retail price).


There are also sections of the Trade Practices Act which prohibit the use of pricing by a large company to damage a smaller competitor, and there are also general rules against misleading and deceptive conduct which can apply to pricing and are designed to make sure that businesses trade fairly with their customers.


Provided that petrol companies are not in breach of any of these laws, there is nothing to stop them charging whatever they like for petrol. The difficulty with petrol prices is that there are many market forces which are influencing those prices from day to day. Those factors include changes in international prices, which can be influenced by supply issues and by wars and terrorism; movements in the exchange rate of the Australian dollar with the US dollar; levels of federal and state taxes; and also the local weekly price cycles which occur within each city.


The ACCC some time ago published a report on petrol price cycles and has recommended that consumers should be made more aware of those price cycles, so that they can learn how to buy petrol at times when prices are relatively low. The ACCC is committed to competition between suppliers which ideally should enable prices to be reduced when possible, so that on average prices will be kept as low as possible.


You may be interested in looking at the ACCC website www.accc.gov.au for discussions on this and other consumer affairs issues.