Legal risk considerations for independent schools: facilities hire agreements 

With increasing financial pressures, independent schools are looking to diversify their income streams. One attractive option is hiring out school facilities. However, when entering into these agreements, extra diligence is required. 

Legal risks can be significant, especially when safeguarding children is paramount under the guidelines of Keeping Children Safe in Education (KCSIE). It is crucial for schools to scrutinise their hire agreements to ensure they are fit for purpose and effectively manage the school’s risks. Here are five key points to consider. 

1. Damage to property 

Many independent schools operate historic or uniquely designed buildings where maintenance is both challenging and costly. The agreement must clearly allocate responsibility for any damage incurred during the hire period (whether accidental or intentional) to prevent disputes and avoid unexpected repair costs. 

2. Liability and insurance 

It is essential that the school’s liability under the agreement is appropriately limited. While liability for issues such as death or personal injury arising from negligence cannot be excluded. However, for all other matters, the school’s liability should be capped and any liability for indirect or consequential losses (i.e., unforeseeable losses) excluded. Without these safeguards, the school could face claims that exceed available insurance coverage, thereby risking its assets and very existence. 

3. Adequate insurance by the hirer 

Linked to liability is the need for the hirer to carry sufficient insurance. Should the hirer’s activities lead to a claim against the school, it is vital that the school is able to recover any related costs. This measure is particularly significant when the hirer is a smaller organisation, such as a local sports club or charity, which may not have the assets to cover substantial claims. 

4. Safeguarding 

Given the potential for any hirer to come into contact with vulnerable individuals (whether children or adults) the agreement must mandate robust safeguarding protocols. This could involve requiring the hirer to adhere to the school’s safeguarding policy or, alternatively, to comply with their own policy if it meets the school’s standards. Schools must be mindful of KCSIE, which stipulates that appropriate arrangements must be in place to ensure children’s safety. 

5. Cancellation, force majeure, and termination 

The agreement should contain clear provisions on termination. It must specify who holds the right to terminate the contract and under what circumstances. Additionally, the agreement should detail the consequences of termination, including any cancellation fees, refund policies, and whether termination rights change depending on how the termination is triggered (for example, by a breach of contract or due to a force majeure event). 

Conclusion 

For independent schools, carefully negotiated hire agreements are far more than administrative formalities; they are vital safeguards for student welfare, institutional integrity, and financial stability. By comprehensively addressing liability, property damage, insurance requirements, safeguarding measures, and termination provisions, schools can significantly mitigate against some of the major risks posed by hire agreements.