The liability waiver might be said to be the Rodney Dangerfield of legal documents. People rarely read the documents they sign before engaging in a dangerous activity and they often outright scoff at the enforceability of the waiver’s contents.
I have heard more than one person say, “I didn’t read it, so it can’t be held against me”. Like most generalities spouted about the workings of the law, this one is inaccurate most of the time.
The legal reality is there is a common law rule that parties will be bound by such a document, even if they haven’t read it. There are, however, exceptions to this rule. Employers who have employees sign a liability waiver before a recreational activity or as part of their hiring process would be well-advised to understand their nuances.
The B.C. Supreme Court recently ruled on the enforceability of a waiver signed by a golf course patron when renting a golf cart. Chico Okihiro was golfing at Hyde Mountain Golf Course and, in the course of renting a motorized cart, signed a document entitled “Cart Liability”. At this particular course, players were required to rent golf carts.
According to Okihiro, the staff person at the Hyde Mountain pro shop presented him with various receipts to sign and directed him where to sign. Okihiro recalled that there was no explanation given of what he was signing and that it all happened quickly as the pro shop was busy with lots of activity.
Okihiro did not read the paragraphs of text below the title of the document before signing, and he said that nothing was done to draw his attention to them. He assumed he was signing something which made him responsible if he damaged the golf cart.
It turned out that the liability waiver stated, “I promise and further agree to hold Hyde Mountain on Mara Lake Golf Course its agents free and harmless from any damage or claims of any nature whatsoever that may arise from or through my use of said Golf Cart. I represent that I am familiar with the operation and use of said Golf Cart, and that I can operate and control same.”
Later that day, Okihiro was involved in an accident while operating the golf cart. While travelling down a steep cart path in the rain, the cart slid off the path and tumbled down a steep embankment.
Okihiro and his playing partner were both injured in the accident. Okihiro sued for damages.
The B.C. Court repeated the rule that a party signing a document without reading it is bound by its terms, but noted the “reasonable notice” exception to that rule. The exception is applicable only in certain special circumstances, including inducement to sign the document by fraud or misrepresentation and when the party relying on the waiver knew (or had reason to know) the signing party misunderstood the waiver’s terms.
Okihiro sought to convince the Court that Hyde Mountain knew, or had reason to know, that he did not understand the impact of the liability waiver he had signed.
The Court stated that the fact Okihiro was required to rent a cart increased the significance of the waiver protecting Hyde Mountain. It seemed to be stating that the onus on Hyde Mountain to demonstrate it had provided Okihiro with reasonable notice of the waiver’s contents was higher in these circumstances.
The Court found the title, “Cart Liability”, did not sufficiently convey the scope of the waiver sought by Hyde Mountain from its patrons. The title did nothing to alert Okihiro to the fact that he was signing a “potentially wide-ranging” document absolving the golf course of responsibility for injuries suffered through the use of the golf cart.
The contents of the waiver’s text were also analyzed by the Court. It concluded the waiver was ambiguous and that a reasonable reading would not dispel the impression that it related only to a player’s negligent use of the golf cart.
The Court emphasized that any ambiguity in the waiver was to be construed against the golf course operators who prepared it. It could not reasonably be read to say, “I save the golf course free and harmless from any damages or claims that may arise from my use of the cart”.
As a result, the application by Hyde Mountain to dismiss Okihiro’s claims against them was rejected. This is an example of a party attempting to rely on a poorly worded, poorly titled, and poorly communicated waiver of liability.
If your business seeks the protection of a liability waiver, it might start by obtaining clear language of the extent of the waiver, using a title which conveys the significance of the content, and taking active steps to bring it to the signor’s attention. In those instances, whether the individual reads it or not, there is a strong likelihood it will be enforceable.
Robert Smithson is a partner at Pushor Mitchell LLP in Kelowna practicing exclusively in the area of labour and employment law. For more information about his practice, log on to http://www.pushormitchell.com/.