With the holiday season just around the corner, many people are already planning events and celebrations with family and friends. As the host, you are responsible for the general safety of the guests at the party. What many people do not realize is that you could also be held liable for the actions of your guests at, and following, your event. If alcohol is being served the risks increase dramatically. The insurance community has noticed a significant increase in lawsuits and litigation for personal injury; this is why it is critically important to take appropriate steps to minimize your risk and protect yourself when hosting any type of social gathering.
So what are your responsibilities as a host? Under Ontario laws a host must ensure the safety of:
- the physical condition of the premises
- the guests that are invited
- the activities that take place at the event
The above are three critical considerations, as the failure to properly protect guests of the party can result in legal liability. These key areas are important not only for the hosts themselves, but also any facility that authorizes the use of their space for an event. These legal responsibilities should be of particular interest to both unit owners and condominium corporations, as both will want to ensure they are properly protected if a tragic event occurs and one or both parties are sued.
Individuals who are hosting their own event (an event that is not being run by the corporation or its Board), will want to ensure that they have proper insurance coverage to protect themselves should an unfortunate incident occur. Their personal insurance policy may provide that protection, however, unit owners’ policies typically cannot be extended to cover the corporation for liability stemming from a personal event.
Condominium corporations can become legally liable for injuries and damages both from hosting an event for their unit owners, and also simply by allowing a unit owner to host a party in the corporation’s common elements.
When planning their own social events, condominium corporations should check with their insurance broker to determine the best way to obtain liability coverage for these events. Depending on how the condominium corporation’s insurance policy has been set up, it may already include coverage for normally expected events held by the corporation. However, even if the event is already covered, condominium Boards may not want to expose the corporation’s primary insurance policy to certain “risky” events such as larger parties involving alcohol. For these situations the corporation can secure a stand-alone event liability policy. This will transfer the risk away from the corporation’s main insurance policy and ensure that one-off, higher-risk events do not have a long-term impact on premiums and deductibles.
If a condominium corporation allows its owners to reserve the party room to host their own functions, the Board should also make sure that liability protection is in place for the corporation.The corporation’s liability insurance may already be set up to provide protection if the corporation is sued for an injury resulting from a unit owner’s event within the common elements. However, even if the proper coverage is there to protect the corporation – would the entire corporation want to bear the additional risk if Jim Smith in unit #101 booked the party room to host a wild bachelor party? The answer is normally a resounding no! When unit owners host events on common corporation property that are typically more risky (i.e. a large number of people, alcohol present, etc.), it would be prudent for the Board to request that the unit owner secure their own event liability policy. This stand-alone policy should name the condominium corporation as an “additional insured.” This will ensure that if someone is injured at the event and the host and corporation get sued, they will both have protection under the separate event policy.
In addition to insurance, corporations should ensure they have a defined procedure for booking party rooms that allows them to assess and manage their risk. Having a list of permitted events, documenting details of the event, and requiring the unit owner to sign a waiver of liability would all be good risk management tools. Corporations should be aware that while liability waivers are a prudent risk management step, they rarely remove the corporation from all liability on their own.
Whether being protected by the corporation’s policy or a stand-alone event policy – buyer beware, as not all policies are created equal. Certain liability policies may exclude coverage for liquor liability, or they may restrict liability to only a certain defined premises or time frame. Often found in non-standard insurance policies, these additional restrictions and exclusions could result in possible coverage gaps for your corporation.
Additional steps to help you keep your party safe and controlled can be found through government safety and Smart Serve associations. Planning properly and protecting yourself before you host a social event is the best way to ensure you enjoy the party!