Just about everyone has had occasion to sign a liability waiver, or as the courts call them, exculpation clauses. These provisions are contained in many contracts, especially those that involve some sort of physical activity. They are almost universally part of fitness club memberships, ski lift tickets, summer camp contracts, and field trip permission forms. The liability waivers essentially state that you agree to hold the provider of a service harmless if something bad happens to you when you are using their services. These waivers even go as far to try to extinguish liability for not just negligence but also reckless and intentional conduct by the provider.
You might be surprised to learn that these clauses are often worthless in Illinois as courts disregard them as against public policy. The reasoning is simple. People should have an incentive to be careful and should bear the responsibility for their careless acts. If exculpation clauses were upheld, every business would have one and the burden of caring for the victims of careless acts would shift from the actor to the victim or to the government. In the recent case of Spears v. Assoc. of Ill. Electric Coop. the Fourth District Court of Appeals reviewed the law applicable to evaluating the enforceability of exculpation clauses.
Generally, people may contract to release another from liability for their actions, but these contracts are not favored and they are construed against the party that benefits from the waiver.
There are four elements required for exculpatory clause to be enforceable in Illinois courts. The elements are:
- The terms of the clause must be clear, explicit and concise;
- The clause must encompass the activity, circumstance or situation contemplated by the parties;
- The clause must not be against settled public policy; and
- Nothing in the relationship between the parties militates against upholding the agreement.
The types of relationship that militate against upholding an agreement include:
- Employer and employee; and
- The public and those charged with a duty of public service such as a common carrier or public utility.
Courts also evaluate whether there is a disparity in bargaining party between the parties. Factors influencing the decision whether there is a disparity of bargaining power include:
- The sophistication of the parties;
- Whether the injured party should have been aware of the risks involved in the activity;
- Whether the injured party was under economic or other compulsion to agree to the release; and
- Whether the injured party had a reasonable alternative.
Courts pay particular attention to situations where one provider has a monopoly on an industry or where all providers in the industry use exculpation clauses. If the injured party had no reasonable alternative to signing the waiver, courts are less likely to enforce it.
Thus, liability waivers and releases are far from universally enforced in Illinois and you should not allow the existence of a signed waiver prevent you from seeking the opinion of a personal injury lawyer if you have been injured due to someone else’s careless conduct.