Introduction:
A waiver of liability is legally binding agreement in California in which parties contractually allocate responsibility for injury or damage for a particular transaction or activity. In most cases, one party agrees to assume full responsibility for any adverse event, releasing the other party from any possible liability.
In many relatively risky activities, customers are routinely required to sign a liability waiver in order to participate in activities that might otherwise lead to lawsuits such as:
Sky diving
Snorkeling or Scuba diving
Chartering a vessel
Using a gym or personal trainer
Climbing and rock climbing,
Sports car racing accidents,
School sports and outing activities
Parking your vehicle in private parking lots or garages
Entering into various wilderness areas
And numerous other risky (and not so risky) activities.
The document executed may be labeled “Waiver and Release of Liability,” “Waiver of Liability, “Limitations of Liability,” “Assumption of the Risk,” or “Assumption of Liability” agreements as well as similar names but they are all enforceable with various limitations discussed in this article. Often, they are included as one paragraph in a larger agreement as to use or access. They are also one of the most common agreements entered into by the typical consumer.
The Basic Law:
While fully enforceable if executed by the customer, it is vital to understand that these contracts only protect companies from injuries arising out of ordinary negligence. Under California law, waivers of liability may not prevent people from suing for injuries resulting from gross negligence, recklessness, intentional torts, or illegal acts.
California law defines “negligence” (ordinary negligence) as the failure to use reasonable care to prevent harm to oneself or to others. Gross negligence, on the other hand, is generally defined as the lack of any care whatsoever, essentially an extreme departure from what a reasonably careful person would do in the same situation to prevent harm to oneself or to others. Further, violation of state or federal law pertaining to the activity can nullify a waiver.
As a typical example, let us assume that a school-charter company of sailboats only hires licensed captains to teach sailing to its customers and has each customer sign a waiver of liability. The captains are tested annually by the company to make sure they are still skilled and are familiar with new equipment purchased by the company. Let us assume that one of the captains was ill during the training and thus was not familiarized with new procedures or safety devices and the result was a customer was injured. The failure to train the captain could be considered negligence and absent a waiver, the customer could sue. However, if there is a waiver in place, the company could claim that even if they negligently failed to train the captain on the new equipment, it was a claim barred by the waiver.
But let us assume the captain had contacted the company and asked for training on new equipment two weeks before the accident but the company refused or indicated that he would have to wait for the next annual training. The injured customer could argue this was gross negligence. Let us assume the captain failed to show up for the training because he was a drug addict, the police so advised the company who nevertheless continued to use him even though it found evidence of drug use in his locker. That could be considered recklessness by the company and, again, the customer would and could try to evade any waiver.
The doctrine of Assumption of Risk may pertain to the activity even if no waiver is signed. That concept is discussed in a separate article on this website. Essentially, the doctrine states that some activities are inherently dangerous and that a willing and informed customer must assume that risk if he or she enters into it. Most sports injuries in schools fall under that doctrine.
Note also that the waiver may cover types of liability not specifically the subject of the activity. For example, a broad waiver for rock climbing may seek to include a release of liability for improper maintenance of the premises, negligent hiring or retention of employees, slip-and-fall accidents and other potential lawsuits not directly related to the activity.
In litigation prone California, most liability waivers shield companies from claims for all injuries, whether or not arising out of the activity. It is vital to understand that by signing a liability waiver, you are essentially agreeing not to sue unless someone who is an agent of the business causes intentional harm or exhibits gross negligence or violated state or federal law.
And with very few exceptions, the company will not agree to limit the wording in their standard waivers. From a cost benefit approach, it is not worth it to the company to take the risk given the amount paid by the average customer. Customers either sign them “as is” or they are not allowed to participate in the activity.
Case Law:
- A waiver of liability must be clear, unambiguous, and explicit in expressing the parties’ intent. Many courts in California have ruled that waivers printed in faint or small font, or in an inconspicuous place (deep in a document, on the back of a page, etc.), are less likely to be held enforceable. Further, vague, or confusing language may invalidate the waiver. It is a question of fact for the trier of fact.
- A minor child can not alone sign a liability waiver in California; the parent must also sign. If the parent signs, the child is bound by the waiver.
- Defendants cannot bar action due to a liability waiver after having deceptively encouraged people to participate in an event or activity. The defendant may not induce participation by virtue of fraud, deception, misrepresentation, duress, or undue influence. As an example, if a bungee jumping activity is advertised as safer than flying but is actually ten times more dangerous, that could nullify the waiver.
- Provisions in the waiver that are “unconscionable” will not be enforced in California. A waiver is unconscionable if enforcement would be “unethical. “The trier of fact will determine the unconscionability of the provisions of a liability waiver based on standards of ethics in the relevant community.
Practicality:
Most customers barely glance at waivers and sign them without thinking, wanting to engage in the activity. The wise company makes the waiver large and bold printed knowing that for the average customer they have already decided to engage in the activity and, especially with children clamoring to participate, are very unlikely to back away.
Indeed, we advise our business clients to, if anything, overstate the potential dangers since that will be far more effective if the waiver is ever used in court.
The key is that the company must not be grossly negligent. Reasonable precautions must be taken to ensure the safety of customers, including safety equipment, maintenance of all equipment, and making sure that all customers participating are physically prepared for the activity. This is both common sense and vital for protection of both the company and the customer.
Assumption of risk is a doctrine that should be familiar to the average consumer. If you willingly engage in risky behavior, most juries are not going to impose liability on the company whether or not there is a waiver. A racing car school which taught basics of racing on an abandoned track had a waiver but also had a large sign on their premises which stated, “Only Crazy People Want to Race. Take a Chance and Join Us but Know You are Taking a Chance.”
They were never sued.