H. Can an occupier exclude liability by using notices or contract terms?
Sometimes occupiers use notices or contract terms that try to exclude liability. However, Hong Kong law places important limits on this.
In Hong Kong, the ability of an occupier to exclude liability is primarily governed by the Control of Exemption Clauses Ordinance (Cap. 71). This Ordinance distinguishes between “business liability”, duties arising from things done in the course of a business or the occupation of business premises, and purely private liability.
(i) Business liability
(a) Death and personal injury
Under the Control of Exemption Clauses Ordinance, a person cannot, by notice or contract term, exclude or restrict liability for death or personal injury resulting from negligence. For this purpose, negligence includes a breach of the common duty of care under the Occupiers Liability Ordinance (Cap. 314).
This prohibition applies only where the case involves “business liability”. In other words, an occupier cannot exclude or restrict liability for breach of a duty or obligation arising from things done or omitted in the course of a business, or from the occupation of premises used for the occupier’s business purposes.
The question is whether the occupier uses the premises for business purposes, not why the visitor is there.
For example, a restaurant puts up a sign at its entrance stating, “Enter at your own risk. The management accepts no liability for any injury caused on these premises.” A delivery driver comes to the restaurant to drop off supplies and slips on a wet floor that staff negligently failed to clean or warn about.
The restaurant cannot rely on the sign to exclude liability for the driver’s personal injury if the injury was caused by negligence. This is because the premises are being used for the occupier’s business purposes, so the case involves “business liability” under the Control of Exemption Clauses Ordinance. It does not matter that the visitor was not a customer, but a delivery driver. The key question is the occupier’s use of the premises, not the visitor’s reason for being there.
Crucially, there is a limited exception to this prohibition. Liability for injury caused by the dangerous state of the premises is not considered “business liability” if the visitor was granted access for recreational or educational purposes, unless providing that access falls within the occupier’s primary business purposes. For example, a factory owner allowing a school tour may be able to restrict liability for hazards in the building’s state, whereas a commercial amusement park could not.
(b) Other loss or damage
However, an occupier’s liability for negligence causing harm other than death or personal injury (e.g., damage to a visitor’s car or clothing) may be excluded or restricted, but only to the extent that the term or notice satisfies the statutory requirement of reasonableness under the Control of Exemption Clauses Ordinance.
The reasonableness test
Where exclusion is permitted (for property damage or the recreational exception), the occupier bears the burden of proof to show that the term is reasonable. Courts consider guidelines set out in Schedule 2 of the Control of Exemption Clauses Ordinance, including:
- The relative bargaining strength of the parties.
- Whether the visitor received an inducement (e.g., a lower fee) to accept the term.
- Whether the visitor knew or ought to have known of the term’s existence (considering trade customs or previous dealings).
- Whether the language used was understood by the visitor (e.g., in Hong Kong, a warning only in English may be deemed unreasonable).
(ii) Non-business (private) liability
In principle, an occupier may exclude or restrict liability if it is truly non-business liability, because the Control of Exemption Clauses Ordinance applies to business liability only in relation to the breach of the common duty of care.
If the occupier’s liability is non-business liability, for example, liability connected with purely private premises rather than business premises, then the statutory rule that normally prevents exclusion of liability for death or personal injury caused by negligence does not apply.
Even for non-business liability, an exclusion clause or notice is not automatically valid. It still has to work under ordinary legal rules, including questions such as:
- Was the term or notice properly brought to the visitor’s attention?
- Is the wording clear enough to cover the type of accident that happened?
- Was there real consent or agreement, if reliance is placed on an agreement?
- Is there any other rule of law or public policy preventing reliance on it?
Exclusion vs. warning
A critical legal distinction exists between exclusion notices (which try to prevent a duty from arising) and warning notices (which try to discharge a duty by making the visitor safe).
For more information about warning notices, please refer to “When is a warning notice enough to protect an occupier from liability?”
