Defeating Liability Waivers in Washington State (06/16/11)
There are times when we are required to sign an agreement (e.g., a gym membership, athletic participation form, rental contract for equipment, etc.) which purports to release the party providing the service from all future negligence claims for injuries sustained by the signing party during the course of service. Sometimes these agreements are called liability waivers; other times they are referred to as releases for liability or hold harmless agreements.
Because Washington case law holds that private parties are afforded freedom of contract, many times these agreements are enforced in court in essentially exculpating a negligent party of its own wrongdoing against the injured party. However, there is also applicable Washington case law that helps the injured party invalidate such exculpatory clauses. The following case law discussed below helps injured parties effectively void liability waiver agreements:
The function of a waiver provision is to deny an injured party the right to recover damages from the negligent party causing the injury. Johnson v. UBAR, L.L.C., 150 Wn. App. 533, 537-38, 210 P.2d 1021, 1023 (2009). The general rule in Washington is that a liability waiver is unenforceable if (1) it violates public policy, (2) the negligent act falls greatly below the legal standard for protection of others, or (3) it is inconspicuously drafted. Id. at 538, 210 P.2d at 1023.
I. Liability Waiver Violates Public Policy
Exculpatory clauses in liability waivers are invalid if they violate a public policy interest of this state. Shields v. Sta-Fit, Inc., 79 Wn. App. 584, 585, 903 P.2d 525, 526 (1995). An agreement that has a tendency to be against the public good, or to be injurious to the public, violates public policy. Scott v. Cingular Wireless, 160 Wn.2d 843, 851, 161 P.3d 1000, 1005 (2007). Contract provisions that exculpate the author for wrongdoing undermine the public good. Id. at 854, 161 P.3d at 1006.
Furthermore, "[c]ontracts against liability for negligence are not favored by law" and are strictly construed against parties relying thereon. Glant v. Lloyd's Register of Shipping, 141 Wn. 253, 262, 251 P. 274, 277 (1926) (emphasis added). Courts are therefore reluctant to allow those charged with a public duty, which includes the obligation to use reasonable care, to rid themselves of that obligation by contract. Wagenblast v. Odessa Sch. Dist., 110 Wn.2d 845, 849, 758 P.2d 968, 970 (1988).
In Wagenblast v. Odessa School District, the Washington Supreme Court held that conditioning participation in public school interscholastic athletics on the students and their parents releasing the school district from all potential future negligence claims violated public policy. Id. at 856, 758 P.2d at 973. The Wagenblast court set out a series of six non-exclusive factors in determining whether a liability waiver violates public policy. Id. at 851-52, 758 P.2d at 971.
Under Wagenblast, the enforceability of a release depends on whether: (1) the agreement concerns an endeavor of a type thought suitable for public regulation; (2) the party seeking to enforce the release is engaged in performing an important public service, often one of practical necessity; (3) the party provides the service to any member of the public, or to any member falling within established standards; (4) the party seeking to invoke the waiver has control over the person or property of the party seeking the service; (5) there is a decisive inequality of bargaining power between the parties; and (6) the release is a standardized adhesion contract. Id. (emphasis added). The first four Wagenblast factors address the substance of the exculpatory clause, while the last two factors concern the procedural fairness of the release. Chauvlier v. Booth Creek Ski Holdings, Inc., 109 Wn. App. 334, 343, 35 P.3d 383, 387 (2001). "[T]he more of the foregoing six characteristics that appear in a given exculpatory agreement case, the more likely the agreement is to be declared invalid on public policy grounds." Id. (quoting Wagenblast at 852, 758 P.2d at 971). One of the factors used to determine whether the agreement violated public policy in Wagenblast was whether it was a standardized adhesion contract of exculpation. Wagenblast at 855, 758 P.2d at 973. The court found a public policy violation partly because prior attempts to modify the release had failed; students had to sign it as written or be barred from the program. Id.
There is, however, a more common characteristic shared in cases in which exculpatory clauses in waiver provisions have been found to be void as against public policy. Shields, 79 Wn.App. 589, 903 P.2d at 528. That common characteristic is that they are all important public services - hospitals, housing, public utilities, and public education. Id. (emphasis added). In fact, the Washington Supreme Court has noted that "a survey of cases assessing exculpatory clauses reveals that the common determinative factor for Washington courts has been the services' or activities' importance to the public." Chauvlier at 344, 35 P.3d at 388 (citing Vodopest v. MacGregor, 128 Wn.2d 840, 858, 913 P.2d 779, 788 (1996).
II. Negligence Falls Greatly Below the Legal Standard
A party may not exempt itself from liability for its own negligence if its negligent act falls greatly below the standard established by law for the protection of others against unreasonable risk of harm. McCutcheon v. United Homes Corp., 79 Wn.2d 443, 447, 486 P.2d 1093, 1095 (1971). Courts are reluctant to allow those charged with a public duty, which includes the obligation to use reasonable care, to rid themselves of that obligation by contract. Wagenblast v. Odessa Sch. Dist., 110 Wn.2d 845, 849, 758 P.2d 968, 970 (1988).
In McCutcheon v. United Homes Corp., the Washington Supreme Court struck down as being against public policy a disclaimer of liability agreement which purported to relieve a lessor of a multi-family dwelling complex, and his agents, from all liability resulting from their own negligence in maintaining the common passageways, stairs, and other areas of the premises under their dominion and control but available for the tenants' use. Id. at 450, 486 P.2d at 1097. The plaintiffs in McCutcheon were month-to-month tenants of the building who were injured as a result of the condition of negligently maintained stairways. Id. Basic to the entire discussion is the common law rule that a lessor has an affirmative obligation and duty to exercise reasonable care to inspect and repair premises defects for protection of the lessee. Id. The Washington Supreme Court in McCutcheon made the following public policy statement in its decision:
[A] clause which exculpates the lessor from liability to its lessee, for personal injuries caused by lessor's own acts of negligence, not only lowers the standard imposed by the common law, it effectively destroys the landlord's affirmative obligation and duty to keep or maintain the 'common areas' in a reasonably safe condition for the tenant's use.
Id. at 447, 486 P.2d at 1096 (emphasis added).
III. Liability Waiver is Inconspicuously Drafted
The general rule in Washington is that a waiver provision is unenforceable if it is inconspicuous. Johnson v. UBAR, L.L.C., 150 Wn. App. 533, 538, 210 P.2d 1021, 1023 (2009). Exculpatory clauses contained in liability waivers are strictly construed under Washington law and are unenforceable if their language is insufficiently clear. Chauvlier v. Booth Creek Ski Holdings, Inc., 109 Wn. App. 334, 339-40, 35 P.3d 383, 385 (2001). A court determines the sufficiency of the language contained in an exculpatory clause as a matter of law. Id. at 340, 35 P.3d at 386.
A liability waiver will not be upheld if the releasing language is so inconspicuous that reasonable persons could reach different conclusions as to whether the document was unwittingly signed. Id. at 341, 35 P.3d at 386. Factors in deciding whether a waiver and release provision is conspicuous or inconspicuous include: (1) whether the waiver is set apart or hidden within other provisions, (2) whether the heading is clear, (3) whether the waiver is set off in capital letters or in bold type, (4) whether there is a signature line below the waiver provision, (5) what the language says above the signature line, and (6) whether it is clear that the signature is related to the waiver. Johnson, 150 Wn. App. at 538, 210 P.2d at 1023 (citing Baker v. City of Seattle, 79 Wn.2d 198, 484 P.2d 405 (1971)).
In Baker v. City of Seattle, the Washington Supreme Court invalidated a disclaimer inconspicuously placed in the middle of a golf rental agreement. 79 Wn.2d at 202, 484 P.2d at 407. The releasing language at issue in Baker was in the middle of a paragraph in exactly the same print as the rest of the rental agreement. Id. at 199-200, 484 P.2d at 406. The court stated the following in holding that the disclaimer clause in the rental agreement was void:
[T]he disclaimer was contained in the middle of the agreement and was not conspicuous. To allow the respondent to completely exclude himself from liability by such an inconspicuous disclaimer, would truly be unconscionable.
Id. at 202, 484 P.2d at 407.
This legal brief is intended to provide general information only. It is not intended to form, nor does it create, an attorney-client relationship. Please consult with an attorney to determine whether the authorities cited are current and apply in your particular factual circumstances.
© 2011 Jeffery M. Jacobs, Attorney at Law