Apparent Authority: Know Who is Signing the Waiver

By Doyice Cotten

Tony Coleman sued Otese, Ltd. (d/b/a Texas Raceway) for injuries he sustained at a drag strip owned by  Otese (Coleman v. Otese, Ltd, 2020). He claimed there was excessive oil on the racetrack.  The trial court granted summary judgment to the defense, in part based on the waiver signed by Coleman.

Coleman appealed making several arguments – one of which was that he had not signed the waiver. In fact, it was determined that one of his crew had signed for him; Coleman stated that the signer was probably one of his crew. Apparently, a crew member signing for Coleman was not unusual.

Otese asserted that Coleman acknowledged in deposition that he had to sign a waiver before each race and that others might have been relying on his signature. Thus Otese claimed that this language raised apparent authority as grounds for the summary judgment. [Apparent authority occurs in a situation where a reasonable third party would understand that an agent had authority to act.] The court indicated that apparent authority can, in some cases, bind a principal to an indemnity agreement accepted by an agent. In this case, Otese could not present any evidence as to the identity of the person who signed the waiver, could not say it was a crew member, and could present no evidence to show the signer had actual authority or apparent authority. Hence, the Texas court ruled that the waiver did not protect Otese from liability for its negligence.

There were other issues including a claim of gross negligence. The waiver, however would not protect against gross negligence in any event.

Risk Management Take-away

Even the strongest and best written waiver will not protect the sport or recreation provider from provider negligence if it is not signed by the participant. So, it would seem crucial that the provider institute a waiver system in which the provider insures that the correct person is signing the waiver.

Photo Credit:  Thanks to Cook24v via Flickr.