How Documentation Can Make or Break Your General Liability Claim Defense

If someone accused your business of negligence, would you be able to prove you were not negligent? You may do everything in your power to create a safe environment, but, without documentation, you may never be able to prove you did nothing wrong if you’re hit with a general liability claim. To protect your business from massive jury awards, you need thorough documentation.

Documentation and the Duty of Care

Businesses are not automatically liable for everything that happens on the premises. However, they do have a duty of care to take reasonable steps to keep their customers safe. If they fail to do so, they may be liable for any bodily injuries or property damages that result.

A slip, trip, and fall incident is a prime example. Businesses are responsible for taking reasonable steps to keep customers safe from slip and trip hazards. These steps may include:

• Providing an entrance mat to prevent customers from tracking in rain and snow, as well as providing adequate lighting and handrails.
• Conducting regular inspections of the flooring and promptly repairing any broken tiles, steps, or carpets.
• Conducting regular inspections of store aisles and cleaning up any spills promptly.
• Conducting regular inspections of appliances to ensure they are not leaking.
• Putting out warning signs when the floor might be wet and slippery.
• Keeping walkways free from cords and other tripping hazards.

Although doing all this may prevent many incidents, there is still a chance that someone will fall. For example, a customer could slip in a puddle that formed just moments before and that you did not have the opportunity to clean up. Customers could also fall without any external cause.

Imagine an elderly woman falls on your business premises. Since she’s injured, you call an ambulance for her. Days later, you discover that she is suing your business. She says the floor was wet when she slipped. As you did not see any spills when you helped the woman, you believe this is a false claim. Perhaps the woman is lying or simply remembering incorrectly. Either way, unless you have documentation to prove otherwise, her allegation of negligence may not be defensible.

This is not only an issue for retail stores and restaurants. Any businesses can control general liability exposures by taking reasonable precautions and documenting the steps they take.

The Stakes Are Growing

Preventing unfounded allegations of negligence has always been in the best interest of businesses. However, it’s even more important in the face of rising jury verdicts.

According to the U.S. Chamber of Commerce, massive jury awards of at least $10 million (commonly called nuclear verdicts) have been increasing in both size and frequency. Between 2013 and 2022, the median nuclear verdict stood at $21 million.

Even a simple slip and fall case could result in a multimillion-dollar award. For example, Courtroom View Network reports that a California jury awarded $2.45 million to a woman who says she fell in a Walmart parking lot due to a pothole. As another example, New Jersey Law Journal says a U.S. District Court jury awarded $2.75 million to a woman who slipped and fell in an Outback Steakhouse. In that case, the judge approved an adverse inference jury instruction as a sanction because the restaurant manager only preserved five minutes of video evidence before the incident. The judge ruled that a longer period of footage was warranted.

How to Protect Your Business with Documentation

If someone files a lawsuit against your company, documentation can make or break your case. Be ready by:

• Maintaining logs that show routine inspections and cleaning of the premises. Check these logs regularly to verify that employees are completing them in a timely and thorough manner.
• Keeping records to show prompt response to potential dangers. For example, if a customer reports a pothole in the parking lot and you report this to the landlord (who is responsible for repairing the parking lot), keep a record of this action.
• Documenting any incidents that occur. If someone is injured or property is damaged, document the incident and factors contributing to the incident as thoroughly as possible. Documentation may consist of video, photographs, and witness statements as well as the incident report. This is important even if you don’t think the incident is serious. (You should also report the incident to your insurer.)
• Preserving evidence. After an incident or even a potential incident, ensure you preserve any relevant surveillance footage.

In addition to making sure you have the right documentation to manage general liability claims, you need the right coverage. Heffernan Insurance Brokers can review your coverage needs. Learn more.