In 2004, an elderly woman stepped into the strip mall parking lot in Rockville, Md., that housed Contemporary Watercrafters, a pool retailer.
A resident Canada goose nesting nearby approached the woman and wildly flapped its wings, frightening her. She stumbled, fell, and broke her hip. Afterward, she filed a $750,000 lawsuit against the pool company as well as the property’s owner.
Though retailers do not have the same exposure as builders and service technicians, they are still vulnerable to lawsuits. Most common are slip-and-fall accidents.
But businesses often can protect themselves from legal action by taking the proper steps before, during and after an accident. Here are several guidelines designed to help retailers stay out of the courtroom.
Laying the groundwork
Contemporary Watercrafters ultimately won its case because the firm was proactive. Long before the accident, company officials had notified all the appropriate wildlife agencies that the geese were nesting there. In addition, all conversations were documented.
“Basically, the case came down to the jury deciding whether we acted reasonably with due care to the situation,” says Retail Division Manager Kelly Reed.
Taking proper steps to make your store less susceptible to accidents is what insurance companies call “loss control.” Store owners may not be able to guarantee safety, but they must prove that they acted reasonably under the circumstances and inspected the property frequently enough to ensure it was safe.
An owner is considered liable for a slip-and-fall accident if he or she knew of the dangerous condition, or if the condition existed for a sufficient period of time that he or she should have been aware of it.
It’s recommended that business owners have an employee walk through the store once in the morning and again in the afternoon to check for unsafe conditions. Consider conducting this sweep more often during the busy season, and in areas that display liquid products. The walk- through should take no longer than five minutes for a 2,000-square-foot showroom.
It’s a good idea to keep an accurate log of who completed the walk-through and when, says Jeannette Blanton-Monnat, principal of the Independent Insurance Group Inc. in Ennis, Texas.
Blanton-Monnat recommends creating a checklist with questions such as: Are the aisles clear? Is there any water on the floor? Are the floors clean? Are any floor rugs turned up on the corners? Is there sufficient signage warning customers about a recently cleaned (and potentially slippery) floor?
In case there is a lawsuit, this “sweep sheet” can be produced by the defense to prove the business knew and conducted the proper checks, says Sam Eagle, a personal-injury attorney based in Fountain Valley, Calif.
Security cameras can be another valuable tool for recording evidence, and you might want to consider installing them in your stores to record accidents.
With many affordable models now available, it’s also reasonable for every business owner to keep a digital camera at the store. And it’s equally easy to store photos on your computer, and instantly send the files to anyone who may need them, such as your insurance carrier.
If you lease the store, it’s a bit different in terms of liability than if you own it, Blanton-Monnat says. If a customer is injured in the parking lot, the property owner should be responsible because he or she is in charge of maintaining the premises, fixing potholes, and clearing snow and ice.
Nonetheless, there have been many claims over the years in which tenant-retailers are drawn into a lawsuit.
“If there is a leak in the roof of your store and you can’t get the landlord to come fix it and people are falling down or slipping, that’s not anything that you did wrong. But you will be sued for it because [the customer was coming to shop at] your store,” Blanton-Monnat says.
Therefore, if you are a tenant and there’s a problem with the property, quickly notify your landlord. It’s important that the request to fix the situation is provided in writing, and that you keep copies of the document.
If you, as the owner, are not always on the premises, you should designate an employee, usually the store manager, to oversee any emergency situation that arises, such as an accident, advises Craig R. Prescott, vice president of Georgetown Insurance Service Inc., Silver Spring, Md.
Choose someone with common sense, who will always be there, and who you trust to act on your behalf and keep a cool head. This surrogate should be the sole person, other than the owner, to talk with the paramedics, firefighters, police or the media. Meanwhile, all other employees should stay out of the way unless they are asked to lend assistance.
“If someone fell at my store, the last thing I want is an inexperienced employee talking to the authorities and admitting liability,” Prescott says.
During an accident
Do not admit fault to anyone, and never apologize because that can be considered evidence. In fact, it is always better not to discuss the accident, for there could be extenuating circumstances you may not be aware of at the time.
For example, just because there was some loose tile on the floor, and a woman tripped and fell nearby, doesn’t mean you should jump to conclusions. Upon investigation, you may discover that her child had spilled something and she slipped on the liquid, Prescott says.
“You can imagine once a statement of complicity or guilt is made, it’s very hard to say it was that lady’s own fault,” he explains. Such a comment also can skew witness testimonials — witnesses may be influenced by what they heard rather than what they saw.
Thus, if the customer tries to say the business is at fault, the owner should be as courteous as possible, even assist the injured person where appropriate. But they should never be coerced into admitting liability.
It is always important to be honest with the police and witnesses. “The owner should cooperate fully, but only answer questions and not volunteer any more information than necessary,” says Joseph Q. Poppie, Aqua Pak national program administrator at The Horton Insurance Group in Chicago.
If it is a serious accident, immediately call an ambulance. Make the person as comfortable as possible, and then let the paramedics take over. One of the store managers can even accompany the injured customer to the hospital, Blanton-Monnat says.
“If they were seen by a doctor and then decide to get an attorney and take the case to court, it’s going to come out looking better on your side because you were concerned enough that you took them to the doctor and the injury was documented [immediately],” Blanton-Monnat says.
Take photographs of the accident scene from various angles, the surroundings, the item that caused the injury, and even the injury if you can.
Be sure not to throw away any items, such as a piece of trash, that may have led to the fall. Attorneys look for evidence that is substantive and tangible, such as a substance on the floor, or holes, products sitting out in the aisles, or footprints showing a spill had been there for a long time.
Write down the names, addresses and phone numbers of all witnesses to an accident. Ask for written versions of the incident with their signatures and dates.
Also, call your insurance agent — a requirement for most carriers.
“Your insurance agent is there to guide you through the claims process as well as consult with you whether an incident should or should not be reported to the insurance company,” says Richard Gaynor, president of Middleton & Co. Insurance, Newton, N.J.
If you don’t notify the carrier in a timely manner — ranging from within one hour to a few days of the incident, depending on the severity of the injury — the firm can deny coverage.
As time passes, the accident scene changes, memories become unreliable, and evidence gets lost. So remember to act quickly.
After the fact
In the ensuing weeks, the business should follow up with the injured party on a regular basis until he or she is fully healed, Blanton-Monnat says. This way, the company can get a full report of the accident and potentially mitigate a claim.
“Call the customer up and ask, ‘How are you doing? Are you going to have to go back to the doctor? Is there anything we can do to help you?’” she says.
Or offer to provide a ride to the doctor. Imagine one of your friends has been injured at your house, and you want to make sure he or she ended up OK, regardless of whether you were at fault, she explains.
In fact, it is crucial to keep in touch with the customer in the few weeks after the accident because of “ambulance chasers,” or lawyers who scour the police reports and frequently encourage injured parties to file a lawsuit.
At that point, you may get to their conscience and prevent them from seeing attorneys, Blanton-Monnat says. You do that by staying in touch with them instead of pretending it just didn’t happen.
Most injured parties are satisfied if you offer to cover medical expenses, Poppie adds.
If an injury occurs to the head, mouth, eyes or back, it’s still wise to file a report even if the customer doesn’t make it an issue right away.
“Things like that can come back to haunt you,” Poppie says, adding that lawsuits filed a year or more after an incident are not uncommon.
Therefore, Prescott advises that an owner always should submit at least an incident report for informational purposes to their carrier as a precautionary measure. Once the insurance company has the incident on its books, it will include a notice that there might be a suit, Poppie says.
This move matters long-term because if the injured party returned in a few years and demanded that the business was responsible, the insurance company can simply reference the file and defend its client.
These details may help determine the amount of a claim. Usually, the higher the negligence, the higher the claim, he says.
And because it’s for reporting purposes only, such claims don’t count against the business or raise its premium.