Four State Supreme Courts Reverse their Positions on ReleasePosted: February 11, 2008
Releases are the foundation of most adventure outfitters program to prevent lawsuits. Dependent upon your base of operation and/or your area of operation a release or waiver is the best way to inform your guests of the risks and stop lawsuits. However, the law concerning releases has changed dramatically in four states over the past 18 months.
Changes started February of 2005 when the Wisconsin Supreme court overturned its law on releases. In a case involving a drowning at a
health club, Atkins v. Swimwest Family Fitness Center, 2005 WI 4; 2005 Wisc. LEXIS 2 the Wisconsin Supreme Court set up a series of requirements for releases which will be impossible to meet. Each of the requirements allows the guest to invalidate the release or takes the legal teeth out of the release. The final requirement is a bargain for exchange requirement. This means the outfitter must offer the guest the opportunity to take the trip without signing a release for an additional charge. The additional charge to enjoy the adventure without signing a release must only be a nominal amount; however that does not make economic sense. (For a more thorough analysis see the Outdoor Recreation Law Review
Wisconsin Supreme Court decision threatens businesses relying on releases.)
In Arizona, in a race car mishap, the Arizona Supreme Court took an approach to releases no other state has adopted. In Phelps v. Firebird Raceway, Inc., 2005 Ariz. LEXIS 53, the Arizona Supreme Court held that releases, written contracts, are only an acknowledgement of risk. As such, the trier of fact, normally the jury, must decided whether the injured patron understood the risk of the activity and the release is additional, but not substantive proof of the knowledge. As such, releases in Arizona are not just proof of acknowledgement of risk rather than a contract to prevent a lawsuit. In the future, a defendant relying upon a release will be forced to go to trial to prove the injured guest understood the risk of the activity that injured him. (See the Outdoor Recreation Law Review
Surprising Arizona Supreme Court Decision Further Endangers Release Language.)
The New Mexico Supreme Courtdetermined that a statute designed to protect the Equine industry prevented the use of a release by a stable.
In Berlangieri et al. v. Running Elk Corporation, et al., 48 P. 3d 70 (N.M. App. April, 2002 the New Mexico Supreme Court stated the New Mexico Equine Liability act provided the only protection for equine outfitters and therefore it prevented the use of a release. This decision is limited to only equine activities; however a similar decision in West Virginia was the beginning of a series of decisions invalidating releases. This is an example of a statute that was meant to protect an industry doing more harm than good. (See the Outdoor Recreation Law Review
Release of Liability Found to Violate Public Policy.)
The final decision is a Connecticut Supreme Court decision, Hanks v. Powder Ridge Restaurant Corporation et al. 276 Conn. 314, 2005 Conn. LEXIS 500 that overruled a case with the identical fact situation six years earlier. In this case a patron at a tubing hill signed a release and was injured tubing. He sued and the Connecticut Supreme Court overruled itself stating releases were no longer valid in the state because it removed the incentive for the tubing operator to keep the premises safe. The Supreme Court held that releases for recreational activities violate public policy. Public policy is the protection the courts extend to the public to protect them when they cannot protect themselves. Those protections are normally limited to those necessities of live that the public cannot live without such as utilities or public transportation. (See the Outdoor Recreation Law Review Connecticut Supreme Court takes yet another bite out of releases with latest decision.)
All of these decisions are discouraging; however there are methods to change the results for a particular outfitter. The easiest and most important way is by using an effective Jurisdiction and Venue clause in a release. Jurisdiction means the law that will be applied and Venue means the location of the court that will hear the case. If you are operating in any of these four states, or another state that prohibits the use of a release, you can specify in the release the state where the case will be heard and the law that will be applied.
For Additional Analysis of these cases or to read the legal opinion, go to the Outdoor Recreation and Fitness Law Review.