By Doyice Cotten
In the post last week, we looked at a waiver in a Puerto Rico jet ski case (Morgan v. Water Toy Shop, Inc., 2018). The Puerto Rican court examined the case in which the plaintiff was seriously injured in a collision with another party; the plaintiff sued the shop that rented the jet ski to the party who caused the accident. Since the incident occurred in navigable waters, the suit fell under maritime law.
Under maritime law, waivers of liability for negligence are enforceable provided they:
- are consistent with public policy;
- do not configure a contract of adhesion; and
- are drafted in clear and unambiguous language.
The U.S. District Court for the District of Puerto Rico first stated that “. . . exculpatory clauses waiving liability for negligence in maritime recreational activities are consistent with public policy.” Subsequently, parties can agree to allocate risks inherent in those activities; further, operators can contract to absolve their liability for their own negligence. Plaintiffs claimed, however, that the waiver was against public policy because it was in violation of a state safety statute. While the court said this was true, it ruled the waiver was not against public policy because the actions of the defendant constituted negligence regardless of the state statute.
The second consideration of the court was that adhesion contracts are ‘take it or leave it’ contracts with no opportunity for negotiation between parties with unequal bargaining power. The court responded that that definition did not fit voluntary recreational pursuits because they do not involve essential services.
Third, the plaintiff contended that the waiver was not clear and unambiguous. The court disagreed stating that the waiver language [Waiver is found in last week’s post, Puerto Rico Jet Ski Case . . . .]
- identified the specific risks inherent to and associated with riding a jet ski;
- explained and highlighted the fact that, by executing the Agreement, plaintiffs waived and released any and all claims based upon negligence against Water Toy, its officers, directors, employees, representatives, agents, and volunteers and vessels; and
- stated that plaintiffs accepted responsibility for the consequences of riding the rented jet skis.
The court added that
both plaintiffs and Castro signed the Agreements before boarding their respective jet skis, acknowledging that they (1) were fully informed of the hazards and risks associated with the jet ski and related water sports activities, including collision with other participants or watercraft; (2) read, understood, and agreed to abide by the “Personal Watercraft Operational” instructions at all times; (3) were trained in the safe use of watersports equipment to their complete satisfaction; and (4) were physically and mentally able to participate in the water sports activities.
Fourth, the plaintiff argued that she did not read the waiver. The court replied that the plaintiff was a college-educated U.S. citizen interested in participating in a hazardous maritime recreational activity available only on condition of agreement to release the provider of liability. Subsequently, “the defendant is entitled to rely in good faith upon the reasonable appearance of consent that plaintiff created.”
Plaintiffs also claimed that the waivers mention “negligence” but not “fault,” and cannot bar their action because the complaint alleges that their damages result from defendants’ “fault” or “negligence.” While the terms differ slightly in their definitions, the court gave no weight to the argument. Plaintiffs also alleged the waiver did not include Axel Acosta (president), the insurance company, or Acosta Water Sports. The court responded that the waiver releases “owners and directors;” and that the insurance company’s exposure is dependent on the action against Water Toy Shop. Subsequently, the waivers and releases are valid, and must be enforced except as to Acosta Water Sports.
The waiver protected all defendants except Acosta Water Sports. The court stated that since Acosta Water Sports did not seem to be involved in any wrongdoing related to the accident, the court gave plaintiffs about two months in which to show cause; if not, claims against Acosta Water Sports will be dismissed.
Photo Credit: Thanks to Michael McCarthy via Flickr.