"Releases are not worth the paper they're written
on." We hear statements like this all
the time. Is this really true? Generally speaking, no. What is
true, however, is that releases of liability (also called "waivers")
are probably the most misunderstood contracts in the entire horse
industry.
Part One of this two-part series will begin by exploring
the three main reasons why releases of liability have been known
to fail over the years. Part Two will provide some suggestions
for helping to make a release more likely to be enforced.
Reason For Failure Number One:
The Applicable State's Law Makes Releases Invalid
The vast majority of states nationwide
will enforce releases of liability. This fact surprises many in
the horse industry. Only a small number of states have laws on
the books that invalidate releases used in equine, sporting, or
recreational activities. In a very small number of those laws,
professionals cannot use releases in an attempt to avoid liability
in their activities.
Even in the many states that enforce releases, courts
frequently (but not universally) recognize that people cannot
release away the right to sue another for certain types of more
serious wrongdoing, such as "gross negligence" or intentional
misconduct.
Reason For Failure Number Two:
A Problem or Defect Was Found in the Release's Wording
What is the most common reason why a release
of liability fails? The problem mainly rests with ineffective
language found in the document itself.
Those who have signed releases sometimes sue. Over
the years, the lawsuits have asserted a variety of arguments.
Occasionally, the signer will admit that he or she signed the
release but will attack the document's wording and legal sufficiency.
Here are two examples of these kinds of challenges:
* In a 1993 lawsuit against an equestrian center in
Ohio, the document was termed a "release" but failed
to contain language in which the signer specifically and appropriately
released the center from liability for its own negligence or legal
liability. Instead, the participant seemed only to have released
the center from liability for the consequences of the signer's
negligence.
* In another case, the release document contained a
misstatement of fact (a statement that the facility had no liability
insurance, when this was really not the case). The Court ruled
that this misstatement prevented the stable from relying on the
release.
In both cases, the releases could have been "worth
the paper they were written on," but the courts found them
to be substandard and unenforceable. Certain form contracts as
well as releases prepared without the involvement of knowledgeable
counsel run the greatest risk of falling victim to these and other
types of challenges.
Reason For Failure Number Three:
There Was Some Problem or Defect in the Manner in Which the Release
Was Signed
Even the best-worded release could fail
if there was some legally significant defect in the manner in
which it was presented and signed. Over the years, for example,
releases have failed when those signing them were under the influence
of alcohol or drugs. Releases have also failed when signed only
by someone under the legal age (in states that enforce releases,
typically those at or over the age of 18 can legally sign them).
Other cases exist in which people claimed they were deceived or
defrauded into signing the release, or that they did not understand
what they signed. Whether these claims succeed or fail depends
on the law of the applicable state.
Conclusion
A release of liability is a very
important legal document. Where allowed by law, it can be the
most important contract the horse industry can use. Why? The release
could have the powerful effect of requiring another to relinquish
an otherwise valid lawsuit. For this reason, and in our litigious
society, a release has the potential to save you from losing potentially
millions of dollars.
Not surprisingly, when a release is subjected to a
legal challenge, it is certain to receive very intense
scrutiny. Every word in the document may be examined closely,
as if placed under a microscope. The circumstances surrounding
its execution could also be closely examined. Because this scrutiny
is virtually guaranteed, do not take chances with your release.
If you purchase form releases found in books or in stores, understand
that they are, at best, a starting point, and make sure that they
comply with legal requirements of your state.
Finally, remember that having a release is never a
substitute for having good insurance. make sure that you have
proper insurance for the horse-related activities you undertake.
This article is not intended to constitute legal
advice. Where specific questions arise, consult with a knowledgeable
attorney.
About the Author
|