Chapter 2: Legal Aspects of Loss

Prevention

Competencies for Legal Aspects of Loss Prevention

1. Describe the American legal system and define basic legal
terms.
2. Summarize the meaning of reasonable care, describe how a
hotels duty to exercise reasonable care may not be
delegated, and cite cases illustrating the reasonable care rule.
3. Explain how a hotel might be held liable for the acts of its
employees.
4. Explain how the hotel might be held liable for injuries a guest
receives at the hands of other guests, patrons, or third parties.
5. Identify steps a hotel must take to limit its liability for loss of
guest valuables, and cite cases illustrating a hotels liability for
guests property.

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Chapter 2: Legal Aspects of Loss

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Competencies for Legal Aspects of
Loss Prevention

Continued from previous

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6. Explain how a hotel can limit its liability for loss of a

guests personal property other than valuables, and
describe a hotels liability if guest property
disappears from a guests room, hallways of the
hotel, the hotel lobby, checkrooms, baggage rooms,
storerooms,
orliability
is lost by
fire.
7. and
Describe
a hotels
with
regard to unclaimed
property, and summarize a hotels liability for
8. handling guests mail.
Describe a hotels liability for automobiles belonging
9. to guests and explain the theory of bailment.
Describe a hotels liability for loss of a non-guests
property.
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Chapter 2: Legal Aspects of Loss

Prevention

American Legal System

Every state has its own statutes and court rulings on
innkeeper laws
Common law; federal, state, and municipal statutes;
94 district courts, a court of appeals for each of the
13 judicial circuits, the Supreme Court
The law is a continually changing body of rules

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Chapter 2: Legal Aspects of Loss

Prevention

Basic Legal Terms

Reasonable care
Foreseeability
Proximate (legal) cause
Negligence
Damages (compensatory, punitive)
Trial court
Plaintif
Defendant

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Chapter 2: Legal Aspects of Loss

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American Legal System

Continued from previous

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Summary judgment
Directed verdict
Judgment n.o.v. (notwithstanding the verdict)
Verdict
Appellant
Appellee
Respondent

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Chapter 2: Legal Aspects of Loss

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Hotels and Reasonable Care

Hotels are not insurers of guests personal safety
The hotelkeeper must exercise reasonable care to
prevent injury to a guest
The hotel is generally not held liable for acts that it
could not reasonably foresee

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Chapter 2: Legal Aspects of Loss

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Hotels and Reasonable Care

Continued from previous

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The hotel may not delegate its duty to exercise

reasonable care in order to relieve it from liability
A hotels liability when a guest is injured in a hotels
recreational facilities depends on the guests own
negligencewhether or not the guest exercised
reasonable care
Laws have been enacted to protect ski area
operators, establishing that persons participating in
the sport assume the inherent risks and dangers of
the sport
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Chapter 2: Legal Aspects of Loss

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Hotels and the Respondeat Superior Doctrine

A hotel employer may be held liable for the acts of
his/her employee acting within the course of
employment
Under the respondeat superior doctrine, the act of
the employee becomes the act of the employer

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Chapter 2: Legal Aspects of Loss

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Hotels and Guest Injuries

A hotel may be held liable for injuries received by a
guest that were reasonably foreseeable and that
might have been prevented through the exercise of
reasonable care
Poor lighting, inadequate security, and knowledge of
previous criminal acts may lead to a hotels liability

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Chapter 2: Legal Aspects of Loss

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Hotels and Guest Valuables

The hotel is considered practically an insurer and held
strictly liable for loss of a guests property unless the
loss is caused by a guests negligence, an act of God,
or an act of a common enemy
Common law liability for full value exists unless
modified by state statutes
The hotel must provide a safe or safe-deposit boxes in
the hotel office or some other convenient place
The hotel must post notices to its guests regarding the
existence of the safe or safe-deposit boxes
These notices must be posted in public areas
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Chapter 2: Legal Aspects of Loss

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Hotel Liability for the Personal Property of Guests

Limiting liability: the hotel must post applicable statutes

in a public and conspicuous place; limits of liability
vary depending on the nature of the property lost and
the general location where the property was lost
Property in guestrooms: hotel is not liable for personal
property in excess of $500; if the guest can prove the
hotels negligence resulted in the loss, the $500
limitation may not be binding
Property in checkrooms: hotel is liable for varying
recovery limits depending on whether fees are charged
for the checkroom services
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Chapter 2: Legal Aspects of Loss

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Hotel Liability for the Personal Property
Continued from previous
of Guests
slide

Property in baggage rooms/storerooms: hotel is

liable for losses from baggage and storerooms to a
maximum of $100 unless the guest obtains a
written receipt from the hotel agreeing the value is
in excess of $100
Losses by fire: the hotel will be freed from liability if
the hotel can prove that the fire occurred without
any fault or negligence of the hotel

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Chapter 2: Legal Aspects of Loss

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Hotels and Unclaimed Guest Property

Unclaimed guest baggage or other property in
custody for six months may be sold at public
auction
Hotel must be certain that no agreement was made
to hold the property for a period of time
The statutory procedure for a sale must be strictly
followed
The simpler course is to turn over all lost or mislaid
property to the police
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Chapter 2: Legal Aspects of Loss

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Hotel Liability for Handling Guest Mail

If a hotel accepts delivery of guest mail, it may be
liable for negligence for any failure to deliver such
mail to guests
The hotel may have to assume specific contractual
liability for registered mail under its agreement with
the post office
The hotel may make a special agreement to hold
mail for guests

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Chapter 2: Legal Aspects of Loss

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Hotel Liability for Guest Automobiles

Where the hotel has been entrusted with guests
automobiles, it may be liable for loss or damage
The scope of the hotels duty varies from state to
state
Under the Common Law rule, hotels are liable as
insurers for guests property that is on the hotel
premises

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Chapter 2: Legal Aspects of Loss

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Theory of Bailment
Theory of bailment: the delivery of personal property
for some particular purpose, or on mere deposit, upon
a contract, express or implied, that after purpose has
been fulfilled it shall be redelivered to the person who
delivered it

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Chapter 2: Legal Aspects of Loss

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Hotel Liability for the Loss of a Non-Guests
Property
When the hotel agrees to accept the non-guests
property for safekeeping, the hotel is legally a bailee
and is generally bound by the applicable legal
standard of care
The owner of the property is legally liable for any
loss of the property unless there is a bailment
Actual custody: if a hotel employee takes possession
of the property
Constructive custody: if the property is brought
upon the premises with the hotels consent
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Chapter 2: Legal Aspects of Loss

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Hotel Liability for the Loss of a
Non-Guests Property

Continued from previous

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In the event of a suit against a hotel as bailee, the

hotel has the burden of proof to show that it
complied with the required standard of care
The degree of care required may vary depending on
the state law governing the hotel
The negligence of the property owner may be
asserted by the hotel to reduce or eliminate its
liability

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