Just when you thought your pool company was doing
fine, you get a knock on your
door. Who could it be? You open
the door to find your local sheriff
handing you papers. You stare down at
the header at the top of the page, and
it reads, “RE: Notice of Intent to File a
Lawsuit” in bold print.
Your blood runs cold, and your
heart sinks as you read the complaint
against your company. Of course, you
know the named plaintiff — that’s a
customer you’ve known for years. And
you have a pretty good idea what it’s
about: The complaint is a condition
with the pool you didn’t bother to tell
your former client about. Or maybe
you did, just not in writing.
If you didn’t put it in writing — that
notification of a dangerous condition existing in the customer’s pool — it
turns into a swearing contest. You
swear you did, they swear you didn’t,
and you will lose as they simply state
common sense dictates that if they
knew a dangerous condition existed at
the pool, they would have had it fixed.
They’re not irresponsible morons.
[Side note: If you did put it in
writing, well done, your attorney will
be instantly granted your summary
judgment motion to dismiss the suit,
and you can go on your merry way. But
this is a cautionary tale, so back to our
story.]
No worries, you think, my insurance
carrier will take care of the lawsuit.
You call your carrier and email them
a copy of the lawsuit. Keep your
figures crossed they don’t immediately
bounce back a reservation of rights
letter, where they have placed your
application for insurance under a
microscope and found a tiny but
clearly identified reason to deny
coverage for this lawsuit. Because
they’d rather not cover this lawsuit.
“We have determined,” their
letter says, “that your application for
insurance is inaccurate, and had we
known of the inaccuracy, we wouldn’t
have bound the policy and insured
you. Therefore, we are denying
coverage.”
“WTH?! What do I do now?!,” you
ask the walls of your office.
“Well,” they say, “Now, you have
to hire yourself a defense attorney
and spend a lot of money on attorney
fees and costs. And if you lose, or if it
looks like you’re going to lose, you will
have to pay an out-of-court settlement
or a judgment. You will likely be
dealing with the stress and business
distraction of this lawsuit for a year or
more. It will affect your personal and
professional life.”
BUT — all this could have been
avoided if you would have used a
different form of CYA. Not Cyanuric
Acid, but Cover Your Ass notification
letters when you discovered anything
approaching a dangerous condition at
one of your pools.
These will prove, if you need to, that
you notified the person or company
responsible for the pool operations of
the potential hazard. Make sure you
store your copy safely in a file.
My company, Global Pools, sends
CYA letters on a weekly basis to
residential and commercial pool
clients. I know it takes extra effort to do
this, but we do it, because it Cs our A.
As pool company operators, we
tend to overlook precautions against
liability exposure because we already
face seemingly insurmountable tasks
just running our businesses. But
lawsuits are a fact of life. And the
best insurance against them is CYA
letters, regular safety inspections, and
incentives for your service techs to
alert you to potential liability issues.
Doing these things will substantially
reduce your liability exposure.
This article first appeared in the September 2024 issue of AQUA Magazine — the top resource for retailers, builders and service pros in the pool and spa industry. Subscriptions to the print magazine are free to all industry professionals. Click here to subscribe.
