With COVID-19 now excluded from general public liability by insurance companies, travel and tourism companies have lost their second line of defence. As a result, the only line of defence open to them is their terms and conditions.

This was highlighted during a webinar hosted earlier this week by international insurance brokerage, SATIB, where panellists highlighted that it had now become crucial for suppliers to ensure they were fully protected through their terms and conditions and indemnities.

Onne Vegter, MD of Wild Wings Safaris and one of the panellists on the webinar, said COVID-19 was currently the biggest risk to tourism players.

He pointed out that there were a number of ways the industry could potentially be exposed to litigation around COVID-19, including, for example, taking a guest off a tour if they displayed symptoms and subsequently tested positive.

“The guest taken off the tour would have financial implications, not to mention inconvenience and new logistical problems. Other guests could be angry or fearful that they had now been exposed and some may hold the operator or the supplier, or both, responsible,” he said.

Vegter added that the damages a litigious client could potentially claim could run into millions of rands. “I know of a case where a client sued for an amount of US$3.4 million because he broke his nose on a game vehicle. So this provides an indication of the kind of numbers that could be at play.”

And it’s not just legal implications but reputational damage as well that could suffer if a client posts negative reviews on social media and other platforms.

Director of legal firm Martin and de Beer Inc, Stefan de Beer, who served on the panel as a legal adviser, noted that while legal cases always came down to a set of specific facts, tourism players could protect themselves by ensuring that all their paperwork was in order. “Ensure that you are clear when it comes to your standard operating procedures,” he said, noting that it was important to document everything relating to protocols and procedures.

SATIB provides answers to a number of FAQs

How can I prevent litigation?

Nobody can prevent litigation. However, by ensuring you have a solid contract in place, you can greatly minimise the possibility of litigation. The partners (the tourism player and the tourist) need to enter into the contract on equal footing. When you know that everyone has read and understood your terms, you are as best covered as you can be.

When can I be held liable?

Liability comes down to either a breach of contract or a delict (this means that you either acted intentionally or negligently and this caused someone losses or damages). Should you therefore be proven to have breached the terms of your contract or acted in an intentional or negligent way that caused the claimant damages, you will be ordered liable.

What is negligence?

Negligence comes down to an objective test. What would the reasonable person in your position do? This is not someone who is an expert, or someone who has endless resources. It’s someone with similar access to resources, information and experience as you have: what would they do?

Must industry stakeholders prove that they weren’t negligent? The rule of thumb is that he who alleges must prove. If someone alleges that we are negligent, they must prove that allegation. Keeping records of efforts made and events, will, however, only make it easier to disprove allegations of negligence.

Who is responsible in the case of a COVID incident? Who will get sued? The overseas agent? The lodge? The entire channel?

We’ll likely see a shotgun approach. It is therefore likely that the entire value chain (travel agents, DMCs, tour operators, restaurants and accommodation establishments) may be defendants in litigation. As everyone is guaranteed the right of access to courts, we cannot prevent people from approaching the courts for relief. The mere fact that someone issues summons against you does not, however, make you liable per se.

Where will it be heard if a litigation case is opened?

If you are a South African operator, it will likely be South Africa, or in the country where the services were rendered. A German tourist wouldn’t sue you in Germany for a number of reasons, one being that their courts would not be able to practically enforce an award against a company on another continent.

Am I completely covered if all indemnities are signed and all the terms and conditions are up to date?

It has become our most important line of defence. However, you need to make sure you enforce the terms and conditions. Terms and conditions are not a blanket cover, but they come close.

What can I do to mitigate my risk exposure as much as possible?

1. Draw up the SOPs for your business based on your thorough understanding of your business.

2. Follow, enforce, and apply the procedures vigorously (for example, the wearing of masks).

3. Ensure that your staff, your suppliers, your contractors, and everyone involved follow and understand your SOPs or protocols.

4. Document your cleaning activities and the preventive measures you have taken every single day. Include as many details as you can.

What are the critical elements to include in the contract in terms of contractual liability?

There is unfortunately no blanket answer. Advise your clients clearly what you will do for them. What are the services you are going to render? They have to understand the risk they will be exposed to, and you have to understand that risk. Provide clients with a list of activities and identify as many specific instances as possible where they may occur risk. Be specific and clear. Put your cards on the table. Get the message across that you are both in it together. Always remember to check the contract terms when working with overseas operators. Don’t allow overseas operators to force impossible terms on you. Protect yourself and protect the local industry.