We are fortunate to have a new article by the lady who is perhaps the foremost expert in equine law – Julie Fershtman. While the article relates specifically to equine waivers, waiver law is the same regardless of the sport or activity.
Stables, race tracks, show managers, horse trainers, riding instructors, and individual horse owners often seek ways to reduce their liability risks. Where horse-related activities are involved, a consistent dedication to safety is not always enough since injuries can never be completely prevented. Liability waivers and releases are powerful tools for controlling risks and avoiding liability in the equine industry.
This article explains why liability waivers and releases require careful attention from counsel who draft them or handle litigation involving them.
The Waiver/Release Document
As a fundamental matter, the enforceability of waivers/releases comes from basic principles of freedom of contract. As the Illinois Supreme Court explained in Harris v. Walker, 519 N.E.2d 917, 919 (Ill. App. 1988):
[U]nder certain circumstances exculpatory agreements may act as a total bar to a plaintiff’s negligence claim. We start from our often-repeated axiom that ‘[p]ublic policy strongly favors freedom to contract . . . as is manifest in both the United States Constitution and our constitution.’
Exculpatory agreements such as pre-incident waivers/releases create a conflict, however, between the right to contract and the right to seek recourse through the legal system. The Colorado Supreme Court recognized this in B & B Livery, Inc. v. Riehl, 960 P.2d 134, 136 (Colo. 1998), when it stated that “[exculpatory agreements] stand at the crossroads of two competing principles: freedom of contract and responsibility for damages caused by one’s own negligent acts. ”
Because of this conflict, any release or waiver will be virtually guaranteed to receive intense scrutiny in litigation.
Why the Documents Sometimes Fail
When courts have refused to enforce liability releases in equine and equestrian settings, their reasons have included the following:
* State Law Forbids. In a very small number of states, a state statute invalidated the contract or prevented enforceability. For example, New York’s General Obligations Law, § 5-326, which invalidates exculpatory agreements in places of “public recreation or amusement,” prevented enforcement of releases used by horseback ride operations in Brancati v. Bar U Farm, 583 N.Y.S.2d 660 (N.Y. App. 1992), and Filson v. Cold River Trail Rides, Inc., 661 N.Y.S.2d 841; 242 A.D.2d 775 (N.Y. App. 1997).
* Perceived faulty or incomplete drafting. In O’Connell v. Walt Disney World, 413 So.2d 444 (Fla. App. 1982), the plaintiff signed liability release before a trail ride at Walt Disney World that stated:
I consent to the renting of a horse from Walt Disney World Co. by Frankie, a minor, and to his/her assumption of the risks inherent in horseback riding. I agree, personally and on his/her behalf, to waive any claims or causes of action which he/she or I may now or hereafter have against Walt Disney World Co. arising out of any injuries he/she may sustain as a result of that horseback riding, and I will hold Walt Disney World Co. harmless against any and all claims resulting from such injuries.
During the ride, however, the plaintiff fell and was injured. The trial court dismissed the case on the strength of the release and the child’s express assumption of risk. Reversing dismissal, however, the appellate court found that the release inadequately addressed risks that were to be assumed and improperly omitted language showing an intent to either release or indemnify Walt Disney World for its negligence.
Another example of perceived faulty drafting is Tanker v. North Crest Equestrian Center, 621 N.E.2d 589 (Ohio App. 1993). There, the plaintiff signed a liability release before breaking her back during a riding lesson at the defendant’s equestrian center. The release she signed stated, in part:
In consideration of riding at North Crest Equestrian Center . . . the undersigned agrees as follows:
1. To assume full responsibility and liability for any and all . . . personal injury . . . associated with the riding . . . of any horse or horses at North Crest Equestrian Center.
2. To forever indemnify and save harmless North Crest Equestrian Center . . . its owners, agents, officers and employees from any and all legal liability for damages, expenses, legal fees, judgments or costs arising out of any loss or injury sustained as a result of riding, training, or boarding any horse or horses at North Crest Equestrian Center . . ..
3. To indemnify and save North Crest Equestrian Center . . . harmless from any and all claims and liability for . . . personal injury caused by the . . . negligence of other students, riders, trainers or boarders at North Crest Equestrian Center …
The trial court dismissed the case, finding that the document effectively waived the plaintiff’s claims for negligence. The appellate court disagreed, however, finding that Ohio law requires that releases that purport to relieve a party for negligence “must be expressed in terms that are clear and unequivocal.” Focusing on what appeared to be merely indemnification language, the court held that a jury must decide whether the plaintiff’s intent was merely to indemnify the stable (as the plaintiff had argued), or instead to fully release the stable from all liability (as the stable had argued).
* At the time of the incident, the one attempting to rely on the release violated a licensing statute. Examples include Powers v. Mukpo, 12 Mass. L. Rptr. 517; 2000 WL 33170940 (Mass. Super. Ct. 10/2/2000)(instructor violated statute requiring licensing), and Lee v. Sun Valley Co., 695 P.2d 361; 107 Idaho 976 (Idaho 1984)(outfitter not properly licensed).
* Untruthful statement in the document. Merten v. Nathan, 321 N.W.2d 1173 (Wisc. 1982). The plaintiff, before taking a riding lesson, signed the stable’s release that stated in relevant part:
IT IS EXPRESSLY UNDERSTOOD by the undersigned that Burgundy Ridge Farms, Inc., Peter W. Nathan, Joseph and Kathleen Patton, have no insurance covering equestrian activities and that the undersigned would not be permitted to engage in equestrian activities without this release . . ..
Emphasis added. The underlined language was actually false because the stable did have liability insurance, having apparently bought it some time after the form was drafted. The trial court enforced the release and granted the stable’s motion for summary judgment, and the court of appeals affirmed. However, the Wisconsin Supreme Court reversed and denied enforcement of the release because it found that the false statement regarding insurance rendered the document unenforceable.
* Underage signer. Some courts have refused to enforce releases in the equestrian setting where the signer was under age. Examples: Dilallo v. Riding Safely, Inc., 687 So.2d 353 (Fla. App. 1996); Smoky, Inc. v. McCray, 396 S.E.2d 794, 196 Ga. App. 650 (Ga. App. 1990).
* State Forbids Parents from Releasing Claims of Minor Children. Where the parent or legally-appointed guardian signed the waiver/release for a minor child, some courts refuse to enforce the document as to the minor. Examples of a few states that have so held in the equestrian setting are: Meyer v. Naperville Manner, 634 N.E.2d 411 (Ill. App. 1994); Rogers v. Donelson-Hermitage Chamber of Commerce, 807 S.W.2d 242 (Tenn. App. 1990).
* Gross Negligence. Most states will not allow a waiver or release to bar liability for egregious misconduct, such as gross negligence or willful and wanton misconduct.
Attention to Detail
Lawyers and non-lawyers alike sometimes value brevity as the most important feature of a liability release. Brevity has its risks, however. Most courts have been more inclined to enforce releases when they pay appropriate attention to details, such as:
* Specify or properly describe all parties being released.
* List or describe risks.
* Include the word “negligence.” Courts in several states have expressed a reluctance to enforce releases that fail to specify that the signer is releasing liability for “negligence” or “ordinary negligence.”
* Particularly with longer contracts, make the exculpatory language conspicuous.
Liability waivers and releases have been enforced in boarding and bailment settings. In particular, claims against race tracks ad horse haulers were dismissed on the strength of releases. In Norton v. Jim Phillips Horse Transportation, Inc., 901 F.2d 821 (10th Cir. 1989)(hauling), and Rutter v. Arlington Park Jockey Club, 510 F.2d 1065 (7th Cir. 1975)(stall application).
Equine Activity Liability Acts
As of March 2011, 46 states have passed laws that are designed to, in some way, control certain liabilities when people are injured in equine activities. (California, New York, Nevada, and Maryland have no such law.) These laws often have common characteristics but all differ. Most specify that certain individuals, businesses, and professionals should include certain language in written contracts. For example, Kentucky’s Farm Animal Activity Liability Act, K.R.S. § 247.401, provides that “farm animal professionals” or “farm animal activity sponsors” should include the language cited below in contracts for “the providing of professional services, instruction, or the rental of equipment or tack or a farm animal to a participant, whether or not the contract involves farm animal activities on or off of the location or site of the farm animal professional’s or farm animal activity sponsor’s business”:
Under Kentucky law, a farm animal activity sponsor, farm animal professional, or other person does not have the duty to eliminate all risks of injury of participation in farm animal activities. There are inherent risks of injury that you voluntarily accept if you participate in farm animal activities.
When drafting exculpatory agreements, be sure to review the applicable Equine Activity Liability Act language. It might require warning, inherent risk, or other language should be included.
About the Author
Julie I. Fershtman ([email protected]) is a shareholder with the law firm Foster Swift Collins & Smith, P.C., (www.fosterswift.com) in its Farmington Hills, Michigan, office where her practice focuses on general liability defense, commercial litigation, insurance coverage, sporting and recreational liability, and equine law. A lawyer for nearly 25 years with a practice that is national in scope, she has successfully tried cases before juries in four states. In addition, she is the author of two books and a contributor to four other books. She has lectured at conventions, industry expos, and continuing education conferences in 27 states. She can be reached at 248-785-4731.