Exculpatory Clause - Didn't Work For Disney - October 19, 2015
EXCULPATORY CLAUSE - DIDN'T WORK FOR DISNEY
It's a good time to update your agreements. If you're not using the Standard Form Agreements you need to get them today. If you have them you need to check and make sure they are up to date. Significant changes to the forms were made in 2013, so if your form is 2012 or older, get new ones. Your 2013 forms will work but they aren't 2015 forms. Not sure how out dated your forms are? Contact our Contract Administrator Eileen Wagda at 516 747 6700 x 312. Order the forms at https://www.kirschenbaumesq.com/page/alarm-contract
Your alarm agreement is the most important tangible asset you have in your business. It will be used to calculate the value of your business and it will be used to protect you from nuisance and real lawsuits when your subscriber suffers a loss despite your alarm and security equipment and your alarm and security services. Though it's hard to envision an alarm / security agreement in the same way as a finely tuned piece of machinery or complex programmed panel, it's time you started thinking that way. You need your alarm agreement to be enforced because you need the protection and you need to be able sell that agreement to a sophisticated buyer of alarm contracts who knows the difference between a Kirschenbaum Contract and toilet paper.
A recent case illustrates how important it is to properly draft the exculpatory clause and how and when to try and use it as a shield to a claim. Walt Disney World and Parks was sued when a patron was walking in a vendor area and hit by large balloon tethered to a tree advertising a vendor, suffering head injury. Two days later the patron returned to the park to participate in a paintball competition and was required to sign a Disney Sports Waiver and Permission Form. The waiver applied to "paintball and any other activities conducted at or in conjunction with the Event"
"The relevant exculpatory clause of the Waiver states:
In consideration of my and/or my child or ward's participation in the Sport Type(s) and Event referenced above and any related activities (collectively, the “Event”), wherever the Event may occur, I agree to assume all risks incidental to such participation (which risks may include, among other things, muscle injuries and broken bones), on my own and/or my child or ward's behalf, and on behalf of my and/or my child or ward's heirs executors, administrators and next of kin, I hereby release, covenant not to sue, and forever discharge the Released Parties of and from all liabilities, claims, actions, damages, costs or expenses of any nature arising out of or in any way connected with my or my child or ward's participation in the Event and/or any such activities, and further agree to indemnify and hold each of the Released Parties harmless from and against any and all such liabilities, claims, actions, damages, costs or expenses including, but not limited to, all attorneys' fees and disbursements up through and including any appeal. I understand this release and indemnity includes any claims based on the negligence, action or inaction of any of the Released Parties and covers bodily injury (including death), property damage, and loss by theft or otherwise, whether suffered by me or my child or ward either before, during or after such participation. I declare that I and (if participating) my child or ward are physically fit and have the skill level required to participate in the Event and/or any such activities. I further authorize medical treatment for me and/or my child or ward, at my cost, if the need arises"
The patron, now a plaintiff, sued Disney and the company who put up the balloon. Two years into the lawsuit Disney's attorneys decided to amend Disney's answer, claiming the Waiver constituted a release of all claims and an indemnity. Disney moved for summary judgment and the plaintiff, who apparently didn't have an attorney, opposed.
The Court discussed exculpatory clauses and enforcement considerations. Here are a few quotes from the decision:
- " We note generally that “exculpatory clause purport[ ] to deny an injured party the right to recover damages from a person negligently causing his injury"
- "These clauses are “disfavored in the law because they relieve one party of the obligation to use due care and shift the risk of injury to the party who is probably the least equipped to take the necessary precautions to avoid injury and bear the risk of loss."
- "Such clauses are “strictly construed against the party seeking to be relieved of liability.”
And here is the paramount consideration for enforcement:
"xculpatory clauses are enforceable only where and to the extent that the intention to be relieved from liability is made clear and unequivocal. The wording must be so clear and understandable that an ordinary and knowledgeable person will know what he is contracting away. A phrase in a contract is ambiguous when it is of uncertain meaning, and thus may be fairly understood in more ways than one."
The Court denied Disney summary judgment - the Waiver didn't apply.
"Unlike a pre-claim exculpatory clause, which requires specific language because of the uncertainty of future events, consideration for a post-claim release—at issue in this case—arises from the parties' awareness “of the circumstances related to the injury and the injured party can reasonably be held accountable for fully appreciating the implications of a general release.”
"..... .”This language clearly focused the signatory on the paintball competition, not the vendor area. The parties further admitted that Disney did not require people accessing only the vendor area to sign the Waiver."
The case is Owen PETERSON, Appellant, v. FLARE FITTINGS, INC., d/b/a Crossfire, Inc., Crossfire, Paintball, Inc. d/b/a Crossfire, Inc., and Walt Disney Parks and Resorts U.S., Inc. d/b/a Disney's Wide World of Sports, Walt Disney World Co., Appellees. District Court of Appeal of Florida, Fifth District. 2015 WL 5883712