BUSINESSES may be extremely exposed to the risk of litigation if they do not take simple actions to protect themselves. This is according to Yaneek Page, founder and managing director of Future Services International Limited (FSIL), a legal funding and litigant support company in Jamaica. She was speaking at a seminar on 'Simple Risk Solutions for Business Success' put on by FSIL at the Courtleigh Hotel yesterday.

Page, who is certified in risk management, said that businesses face a myriad risks of lawsuits that, if not mitigated against, can have dire financial consequences because not only will they have to pay significant amounts in damages, but the legal fees of the claimant as well.

"The truth is, many Jamaican companies and organisations are unaware of the fact that they are at risk until they have been hit with a multi-million dollar lawsuit. If you have employees, customers, clients, an office, shop, food outlet, store or any other place of business that is open to the public, then you are certainly at risk," Page said.

Among the most exposed to risks are businesses that include medical services, the media, insurance, manufacturing and food companies.

Page said a significant malpractice claim can "wipe out" a doctor, and the number of persons seeking representation as a result of error is large. She says FSIL sees at least three persons each week who have medical malpractice claims, some for simple errors such as the doctor getting the wrong x-ray report, which results in tremendous loss to, or death of, the patient.

Manufacturing and food service companies are advised to pay attention to occupational safety, health and food standards, as these are the most common grounds for lawsuits. Page said these companies should also look at where the disgruntled employees are within the company, as these persons may seek to sabotage the operations and cost the organisations millions of dollars in damages.

"It is important that we prevent the closure of small businesses which are vital to the growth of Jamaica's economy and, more importantly, prevent loss of life," Page said.

There is also significant exposures in schools and colleges -- which may have improper and unsafe building construction; the Government and licensed professionals who give advice as a function of their expertise. Licensed professionals who give advice as a function of their expertise may be held liable for errors, omissions or defective designs made in the delivery of the service. This group includes architects, contractors, doctors and pharmacists, lawyers and financial advisors,she said

"We need to speak to the Government because if they knew their risks they wouldn't be having some of the problems they are having now," Page said.

A participant in the seminar shared a case which cost the Government a lot of money. He said he was offered a job by a government agency and after resigning his current job, was then told by the agency that his services were no longer needed even before he started working. He said his employment contract stated that he would receive three months' payment in lieu of the time he would have lost, but the director and managers of the agency reneged on the contract, telling him he would not be paid for a day he had not worked. However, after going through with the litigation with the help of FSIL, he said his award was "substantial". Page noted that had the director and manager known about the rights of the applicant in this regard, they could have saved the Government a lot of money.

She gave another instance that involved the manager of a company which tests bulletproof glass. He ordered an employee to hold the glass while it was being tested. The employee was injured and bleeding in the process but was told to go back to work. Again, she said, this cost the company a significant amount in damages and lawyer's fees.

"You have some people in some companies that are absolutely cruel. If you have those people in the company, whether as HR (human resources) manager, get them out," Page said. She advised the company representatives present at the seminar that these persons are liabilities to the organisation, particularly where lawsuits are concerned.

"Companies have to educate their staff that they are putting them at risk by their actions,"

Elizabeth Chang, Marketing Manager of Jamaica International Insurance Company (JIIC), added.

Chang, who presented on the value of insurance in managing some of the risks and the insurance options that businesses can employ, added that in most cases the individual has up to six years to file a claim against the entity in question, which makes the risk even greater for businesses.

She advised business persons that getting adequate insurance is one way in which companies can protect themselves against large claims. She said many people who run businesses are not aware that the insurance held on a property by its owner does not cover the business run by the occupier of the property. This can have tremendous financial implications for the business if something happens to the customer, or to the contents of the building.

"Once you have a business that interfaces with the public you have a liability to them," Chang said.

In what was an eye-opener to many businesspersons present, Chang said that some strategies businesses use in an attempt to minimise loss are not enough to protect them from litigation. Signs such as 'slippery when wet' do not absolve a business of responsibility if a person falls and injures himself as a result of a wet floor. "You have to make it dry," she said. Rather than use a sign as a means of 'protection', Chang said businesses might find it cheaper to hire a janitor to clear up spills as a lawsuit may cost more in the long run.

Other signs, such as those indicating that a company is not liable for damage or theft to motor vehicles, are also not adequate protection, especially if the area is an assigned parking for the business. "You are going to have to take responsibility because you told them to park there," she said.

She said even store owners should take care to secure their items properly, particularly if they are breakable as customers are not to be held liable for damage to items once they are not secured. "'If you broke it you bought it' is not a good claim because the owners should secure the things properly," Chang said. Further, she said, "if somebody comes in and takes up a vase and it falls on the person and injures the person, you are liable".

Both presenters recommend getting insurance, proper legal advice on policy matters and taking steps to assess risks and level of exposure before a lawsuit is filed.

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