P was injured while undergoing an initial evaluation at a fitness club owned by D.
P signed a membership contract which waived all rights to sue D for active or passive negligence of itself or its employees.
P sued D in negligence and argued that the provision in the contract should not excuse the negligence of D.
Procedural History:
Trial court found for D.
MD Court of Special Appeals affirmed, found for D.
Issues:
How does a court determine if an express assumption of risk clause in a contract should be enforced?
Holding/Rule:
Express assumption of risk clauses should be enforced if the risk that injured the P fell within the unambiguous terms of the agreement and if the contract itself is not against public policy.
Contracts are void for public policy reasons when…
The party protected by the clause intentionally causes harm or engages in acts of reckless, wanton, or gross negligence
The bargaining power of one party to the contract is so grossly unequal so as to put that party at the mercy of the other's negligence
The transaction involves the public interest.
Reasoning:
Did the clause unambiguously excuse D's negligence?
An exculpatory clause is sufficient to insulate a D from negligence as long as its language clearly indicates the intent to release the D from liability for injury caused by the D's negligence.
There was no fraud, mistake, undue influence, or overreaching.
Thus, this provision expresses a clear intention by the parties to release D from liability for all acts of negligence.
Does the contract violate public policy?
D did not intentionally or recklessly cause P's injury.
Even though the contract signed was a contract of adhesion, this does not create a huge disparity in bargaining power. To possess a decisive bargaining advantage, the service offered must usually be deemed essential in nature. Gyms do not fall under this category since there are tons of them around.
The public interest is not affected in this case. Public interests are affected when…
The party is a business of a type generally though suitable for public regulation
The party seeking exculpation is engaged in performing a service of great importance to the public
The party holds himself out as willing to perform this service for any member of the public who seeks it
The party invoking exculpation possesses a decisive advantage of bargaining strength against any member of the public who seeks his services
There is no provision whereby a purchaser may pay additional reasonable fees and obtain protection against negligence
The person or property of the purchases is placed under the control of the seller, subject to the risk of carelessness by the seller or his agents.
D does not provide an essential public service through analysis of the factors listed above.
Dissent:
None.
Notes:
This is an express assumption of risk case, essentially a contract issue (no wonder I like it).
