By Alexander “Sandie” Pendleton
A Wisconsin ski resort received a mixed decision from the Wisconsin Court of Appeals in Schabelski v. Nova Casualty Company, a decision released on June 30, 2022.Although there is a good chance that the 2-1 decision will be appealed to the Wisconsin Supreme Court, the decision provides some important lessons regarding releases in Wisconsin, and again shows how challenging it can be to convince a Wisconsin court to dismiss a claim based on a waiver agreement.
Background: Schabelski Agrees to a Waiver, and Falls from a Chairlift
Kathleen Schabelski went to a small, Wisconsin ski area (Sunburst Ski Resort), and was presented with two options. She could agree to the resort’s standard waiver agreement and pay the resorts regular lift ticket price, or she could choose to pay a higher lift ticket price, and ski at the resort without signing a waiver agreement. Schabelski chose to sign the waiver and pay the regular price. Included in the waiver agreement was a clause that indicated she agreed to waive all claimsof negligence against the resort that might arise out of “the operation of chairlifts, and chairlift loading, riding, and unloading operations, including the presence or absence of restraint bars on the chairs.” After one of her downhill runs, Schabelski went to get on one of the chairlifts, but experienced difficulty getting “settled” onto the chairlift’s seat. As the chair proceeded up and away from the loading area, she ended up dangling from the chairlift some twenty feet off the ground before the operator stopped the lift. Efforts were made to get her down, but after hanging from the chairlift for approximately ten minutes(while a sufficiently-longladder was searched for), she fell from the chair and sustained injuries.
She commenced suit, alleging the resort’s negligence caused her injuries. Her expert opined that it was standard custom and practice for ski resorts to provide evacuation training and equipment to lift attendants, and to have “rescue devices immediately available at the loading area” to evacuate misloaded passengers. Based on this, in the expert’s opinion, the resort’s failure to provide such training and equipment and have such rescue devices immediately availablewas negligence and a cause of the plaintiff’s injuries. After discovery occurred, the resort moved for summary judgment based on the waiver agreement Schabelski had signed on the day of the incident, and the trial court granted the motion.
On Appeal: Win Some, Lose Some
On appeal, the three-judge panel issued a split decision. The majority upheld most of the trial court’s decision, but found that the trial court had erred when it dismissed the skier’s claims for “negligent rescue.” In the majority’s view, the waiver agreement did not “clearly, unambiguously, and unmistakably” inform the skier that she was releasing the resort from liability for a negligent rescue attempt. The dissenting judge disagreed, and would have affirmed the trial court’s dismissal of all the skier’s claims.
The majority ruled in the resort’s favor on several other issues, including holding that: (1) the waiver agreement was well-enough drafted to cover the skier’s claims relating to any alleged negligence by the ski lift operator in loading the plaintiff; and (2) the plaintiff’s allegationsof wrongdoing were merely claims of negligence, and failed to reach that level of wrongdoing defined as “recklessness.” The court also did a public policy analysis, given that it had ruled that portions of the waiver covered some of the plaintiff’s claims. In that analysis, the court held in favor of the plaintiff, finding that the waiver was not unenforceable: (1) for allegedly being “overbroad”; (2) due to a resort employee’s alleged misrepresentations regarding a separate offered agreement; and (3) allegedly failing to provide an “opportunity to bargain.”
On the bargaining issue, Schabelski is significant in that it is the first decision of any Wisconsin appellate court in which a court has found that the waiver in question provided a sufficient “opportunity to bargain”:
[The resort’s waiver] was not presented to customers on a take-it-or-leave-it basis: persons wishing to ski or snowboard at Sunburst could sign the release or pay an extra $10.00 [per day] for a non-release lift ticket. The release afforded customers an opportunity to bargain because it allowed them to select one of two sets of terms: (1) the base ticket price in exchange for the release or (2) a higher ticket price with no release. Because the form itself alerted customers to the availability of release and no-release options, it afforded the Schabelskis an opportunity to bargain.
Take-Aways for Providers
There are several lessons that providers can glean from the decision in Schabelski.
First, Schabelski emphasizes the importance of having a well-crafted, and specific agreement. The majority faults the resort for failing to have its waiver agreement specifically indicate that participants were giving up claims for negligent rescue. To the majority (but not the dissent), it was not enough that the agreement waived claims for “the operation of chairlifts, and chairlift loading, riding, and unloading operations, including the presence or absence of restraint bars on the chairs.”
Providers often do not want to get “overly” specific in their waiver agreements, so as to not make the agreement too long, or too “scary” as to the risks associated with their offerings. Schabelski teaches that such is necessary in Wisconsin, if the provider wants to have an enforceable waiver. As such, providers should consider what risks exist as to their operations, inform participants of those risks (in their waiver agreements and in other ways), and ensure that their waiver agreement “clearly, unambiguously, and unmistakably” informs participants that they are releasing the provider from liability as to injuries caused by such risks.
It is surprising that the resort in Schabelski failed to expressly refer to the risks associated with negligent rescue, and to have participants agree that they were waiving claims associated with negligent rescue. It is foreseeable that on occasion skiers are going to have to be rescued, and it is foreseeable that on occasion such rescues will not go perfectly, and injuries will occur. There is also a well-known 1983 Wisconsin Supreme Court decision (Arnold v. Shawano County Agricultural Society) in which a racetrack’s waiver was held unenforceable, due to the waiver’s failure to indicate the driver was agreeing to give up claims for negligent rescue.If one defines “rescue” as including the obtaining or providing of emergency first aid, it is difficult to imagine an active recreational activity, where there would be no chance that at some point rescue efforts would be needed. Give such and the decision in Schabelski, providers who organize recreational opportunities should ensure that their waiver agreements clearly and specifically have participants expressly waive claims for negligent rescue.
Additionally, many Wisconsin providers still fail to address in their waivers the issue of bargaining, or to have their waiver forms provide an “opportunity for bargaining.” Providers should review their waiver agreement forms to ensure those documents at least address the issue of bargaining, and should contact their lawyers if they do not, so that defect can be immediately fixed. Also,Schabelski provides a “judicial blessing” on the “two-price method” of addressing bargaining. If a provider’s waiver does not use that method, the provider should contact an attorney, to discuss whether and how the provider should adopt a “two-price method” of dealing with bargaining.Requiring the “form itself” to provide an opportunity for bargaining is a factor unique to Wisconsin law (compared to waiver law in other states). Addressing bargaining in a waiver, and implementing a “two-price method” approach, raises a host of questions that a provider should discuss with an attorney well-versed in this area of the law. Such questions relate not just to how a waiver is drafted, but also to how the waiver (and options) are presented to the potential participant, and how employees deal with questions from potential participants about the options.
The Court of Appeals will need to decide whether it is going to make its decision a published opinion (which would give the decision more weight as precedent in future cases). The decision is a thorough decision, so odds are it will be designated for publication.If and when it becomes a published decision, it will be binding precedent on Wisconsin trial courts.
Upon receiving the court of appeal’s decision, both sides in the Schabelski case have had to reassess their position. As part of that, several things could occur: (1) one or both sides could ask the Wisconsin Supreme Court to review the court of appeal’s decision; (2) both sides could instead choose to allow the case to return to the trial court level, for further proceedings on the “negligent rescue” claim; or (3) the parties could decide to settle the case.
If either side decides to request review by the Wisconsin Supreme Court, there is no guarantee that the court will grant the request. The justices may prefer to allow the case to return to the trial court level, for further processing, before the court weighs in. Some of what occurs may be influenced by the political divide that currently exists on the Wisconsin Supreme Court. The current Wisconsin Supreme Court is often described in media reports as comprised of four conservative justices, and three liberal justices. The majority decision of the court of appeals is authored by Judge Neubauer, joined in by Judge Kornblum, both of whom in recent judicial elections have run against candidates supported by conservative groups.The dissent is written by Judge Grogan, who ran last year as a self-described “constitutional conservative.” As such, there may be conservative justices on the supreme court whose judicial philosophies comport more with the dissent than the majority. Such justices (if asked via a petition for review by either of the sides in the case), may decide that the majority’s decision failed to properly apply Wisconsin contract law (or more specifically, Wisconsin waiver law), and that the majority was insufficiently cognizant of the needs of Wisconsin businesses in the recreation industry. Such justices may decide that Schabelski offers the supreme court the opportunity to clarify and perhaps better balance the demands placed on such businesses by such cases as Atkins v. Swimwest Family Fitness Center,2005 WI 4,or Roberts v. T.H.E. Insurance Company, 2016 WI 20.
Finally, if the Schabelski decision stands, it could lead the Republican-controlled Wisconsin legislature to expand statutory protections for ski area operators, as has been done by legislators in other states that have a significant number of ski areas.
Putting aside the “inside baseball” political considerations that the Schabelski case raises, from a provider’s standpoint the case emphasizes two important risk management considerations. First, from an operational risk management standpoint, it is important for providers (1) to have written emergency response procedures, (2) to ensure that staff have adequate equipment to respond promptly to foreseeable emergencies, and (3) to ensure that staff receives regular training, so as toincrease the chance they know the procedures and how to use properly the equipment.Such risk management programs are routinely created and followed at many recreational facilities (e.g., pools). If the ski resort in Schabelski had such written policies, and followed them, the plaintiff might not have been injured, or might not have had a basis for claiming the resort was negligent. Second, from a legal risk management standpoint, good, carefully-crafted and well-deployed waivers can save a provider (and a provider’s insurer) from substantial liability claims, but in Wisconsin great care in the preparation and deployment of such agreements is needed, because the legal standards applicable to those agreements remain highly demanding.
Alexander “Sandie” Pendleton is an attorney in Milwaukee, Wisconsin, who helps recreational opportunity providers create and properly deploy precisely-crafted waiver and other risk-management agreements. Sandie is the co-author (with Doyice J. Cotten) of the forthcoming Eleventh Edition ofWaivers & Releases of Liability (a book that is the leading guide in the United States as to such agreements). Sandie can be reached at [email protected].
I’ve raised this bargaining issue in several articles on waivers that have been published in the Wisconsin Lawyer. See Alexander Pendleton, Recreational Liability: Plaintiff Friendly Standards Remain, 90 Wis. Law. 15(2017); Alexander Pendleton, Drafting Waiver-of-Liability Agreements in Wisconsin: It’s Not Getting Any Easier, WisBar News (May 16, 2013);Alexander Pendleton, Enforceable Exculpatory Agreements: Do They Still Exist?, 78 Wis. Law. 10 (Aug. 2005); Alexander Pendleton, Enforceable Exculpatory Agreements, 70 Wis. Law. 10 (Nov. 1997).In those articles (especially in those articles after the Wisconsin Supreme Court’s decision in Atkins v. Swimwest Family Fitness Center, 2005 WI 4), I have noted (or groused) that the courts have indicated that “the [waiver] form itself must provide an opportunity for bargaining,” but the courts have failed to provide any guidance as to what such would entail, or what amount or type of bargaining would be sufficient. In the absence of any guidance from the courts, in my published articles I suggested that providers structure their waiver agreements and operations so that the participant is offered the option of two prices to participate (a regular “with waiver” price, and a higher “without waiver” price). The waiver in question in Schabelski used the same “two-price method” suggested in my articles after Atkins.
Photo Credit: Thanks to Dave Dugdale via Flickr.