The conviction of a Calgary, Alta. company for a fatal office party accident involving a calf-roping machine has been upheld by the Alberta Court of Appeal, reinforcing the need for brokers to inform companies of their liability at staff functions.
“In today’s world employers must be very conscious of the potential hazards of staff functions,” says Rick Orr, chairman of the board of the Insurance Brokers Association of Ontario. “Prudent decisions must be made as to the type of event and the potential problems that could arise. Employers must ensure that employees are always in a safe situation.”
Orr says this is where brokers can shine, providing advice and best risk management practices – simple advice like the provision of designated drivers at functions where alcohol is involved.
“If alcohol is involved the potential for injury increases significantly,” Orr told InsuranceBureau.ca. “That may involve having designated drivers. When hiring equipment or third party firms it is imperative to explain to a business client that they request proof of insurance and to review any contracts that may require signing.”
Twenty-two-year-old Nathan Shair was killed on July 12, 2007 when a lever prematurely activated on the machine, striking him in the back of the head during a Stampede week party hosted by his employer, XI Technologies at the Hotel Arts in Calgary.
Shair was one of the people operating the contraption, which seated a would-be cowboy atop a mechanical horse that launched forth a mock calf to be roped.
In October, 2011, XI Technologies was cleared of failing to ensure the machine’s safety — a decision overturned by appeals judge Justice Pat Sullivan the following year. The Alberta Court of Appeals upheld that ruling, concluding the company didn’t do enough to head off predictable hazards posed by the calf roping machine.
“XI Technologies did not do all that was reasonably practicable in the circumstances to avoid the reasonably foreseeable risks, and that the operating procedures had not eliminated the significant risks involved with the ride,” the court’s panel stated in dismissing the company’s appeal.
The company now faces hundreds of thousands of dollars in fines, though sentencing has yet to be scheduled.
“Simply put, with any event, businesses should be protecting themselves from liabilities of others,” says the Insurance Bureau of Canada’s Steve Kee. “Always check with your insurance rep; and when using contracts or agreements, have a lawyer.”
The court lambasted the company for opting to use a machine it knew little about, particularly in an atmosphere of alcohol use.
“That XI Technologies would even consider operating a machine that no one had any familiarity with and without either its own operator or a proper set of written instructions in itself speaks volumes as to the lack of its due diligence in this matter,” wrote the justices.
The tragedy in Calgary could have easily been averted with some simple risk management tools, Kee told InsuranceBusiness.ca.
“In risk management terms – some tips include using signs,” he says. “Signs may be used to warn of hazards and provide information. They should be used as a way to possibly prevent losses, but should not be relied on to deflect liability.”
Other measures to manage risk include using contracts that are legally enforceable, and the use of waivers and hold harmless agreements, adds Kee.
“Require insurance certificates,” he points out. “Clients should make a point that an insurance certificate should be required from people and organizations that you enter into agreements with or who supply products and services to you.”
The court noted another employee had suffered a minor injury while operating the machine on the same day, though the equipment continued to be used.
“This is not a situation where XI Technologies recognized the danger and tailored its operating procedures to address it,” they wrote.
The company’s defence had portrayed the death the result of a freak accident, and that its supervisors had done all they could for safety purposes.
The 2011 trial heard the ride’s operating procedure at the party was altered after the minor injury occurred.
