ACE CPT Chapter 17 – Legal Guidelines and Professional Responsibilities

ACE Study Guide Chapter 17

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Business structure

  • Sole proprietorships: Businesses operated and owned by one person
    1. Paperwork is minimal
  • Partnerships: Two individuals decide to own and operate a business and share the losses and profits
    1. Should establish the rules of the operation through legal documentation
    2. General partnerships: The joining of two people to operate and own a business
      • Minority partner: The person who owns less of the two partners
      • Express partnerships: This is a contract between the parties
      • Implied partnership: This is recognized by the judicial system if the individuals are acting as partners
    3. Limited partners: These partners are only liable for the direct contribution they make financially
  • Corporations: This builds a separate entity from the operators of the business and the investors
    1. S corporations
      • Profits flow to the shareholders through the business
      • This is taxed as normal income
      • Personal trainer businesses that do not operate as a partnership or sole proprietorship, this is the most common
      • The shareholders are protected from personal liability
        1. Cons – Potential investors are limited
        2. The costs of operation and formation
      • LLP and LLC
        1. Investors have the profits flow to them and are taxed as regular income
        2. Taxes are easier compared to S Corp.’s
          • Cons – Operating standards or undefined in the states
        3. C Corps
          • Unlimited number of investors and limited liability
            1. Cons – double taxation and the cost of the operation and formation

Independent contractors

  • People that are hired for short-term basis


  • People that work for their employer


  • Acceptance and offer with an agreement of terms
  • Legality
  • Consideration
  • Parties can enter a contract with respect to mental capacity and legal age

Negligence (must have 4 elements)

  • The defendant has a responsibility to protect the plaintiff from injury
  • The defendant could not uphold the standard necessary to perform the duty
  • Injury or damage to the plaintiff
  • Injury or damage that was caused by the defendant’s breach of duty

Vicarious liability

  • This is where employers are held responsible for the actions of their employees
  • Gross negligence
    1. This is a willful disregard for the health and safety of others
  • Contributory negligence
    1. This happens if a client does not mention potential hazards to the personal trainer
    2. Will prevent the client from recovering money, even if the personal trainer was at fault or partially at fault

Informed consent, agreements to participate and waivers

  • Agreements to participate
    1. Personal trainers have to have a way of warning clients of potential risks of exercise
  • Informed consent
  • Inherent risks
  • Procedures
    1. Each individual having a standalone document

Legal responsibilities

  • Facilities
  • Equipment
    1. AED
  • Supervision
  • Instruction

Liability insurance

  • Independent contractors as well as employees
  • Need to be able to cover attentional costs of injuries related to exercise

Legal implications and other business concerns

  • Intellectual property
  • Marketing activities
  • Transportation
  • Financing

Risk management

  • Risk evaluation (referred to table 17 – 2)
  • Risk identification
  • Managing/approaching each risk
    1. Transfer, avoidance, retention, reduction, implementation, and evaluation

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ACE CPT Chapter 17 - Legal Guidelines and Professional Responsibilities 1
ACE CPT Chapter 17 - Legal Guidelines and Professional Responsibilities 2
ACE CPT Chapter 17 - Legal Guidelines and Professional Responsibilities 3

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