SandBar 6:3, October, 2007

City’s Liability Waiver Invalid

City of Santa Barbara v. Superior Court, 41 Cal. 4th 747 (Cal. July 16, 2007).

Sara Wilkinson, 3L, University of Mississippi School of Law

The California Supreme Court recently held that waivers signed by participants in sports or recreational programs limiting liability for future gross negligence are void as a matter of public policy. The court reasoned that public policy bars enforcement of an agreement that would effectively remove any obligation to adhere to a minimum standard of care.

Background
The city of Santa Barbara runs Adventure Camp, a summer sports and recreation camp for developmentally disabled children. Camp activities include swimming, arts and crafts, group games, sports, and various field trips. In 2002, the Adventure Camp application included a form releasing the city and its employees from liability, including liability based on any negligent act. That same year, a camp participant, 14-year old Katie Janeway, drowned while attending the camp. Katie’s mother, Maureen Janeway, had signed the release of liability, just as she had in the previous years that Katie had attended the camp.

Katie suffered from cerebal palsy, epilepsy, and other similar developmental disabilities. Before camp began, Maureen Janeway disclosed Katie’s med­ ical problems to the camp, relating that Katie was prone to seizures in and around water and that she would need supervision while swimming. The city was aware of Katie’s medical problems, as she had suffered several seizures at Adventure Camp in past years.

Based on the information provided and Katie’s history of seizures, the city assigned a camp counselor, Veronica Malong, to keep Katie under close observation during swimming sessions. Malong had witnessed Katie’s seizures and had attended training sessions to help her respond to seizures and perform first aid.

Katie participated in the first swimming day without incident. On the second swimming day, Katie had a mild seizure while waiting to enter the locker room at the swimming pool. Malong sent someone to report the seizure to a supervisor, who later claimed not to have received the information. Malong observed Katie for 45 minutes and then concluded that it was safe for Katie to swim. Katie dove off the diving board, swam to the side of the pool and took a short break by the side of the pool. After Katie’s second dive into the pool, she suffered a seizure while swimming to the side of the pool and drowned.

Katie’s parents filed a wrongful death action against the city of Santa Barbara alleging that the accident was caused by negligence on the part of the city and Malong. The city moved for summary judgment, relying primarily on the liability waiver. The city’s motion for summary judgment was denied and the city appealed.

Waiver of Gross Negligence
In determining whether to uphold the lower court’s decision, the California Supreme Court provided a lengthy discussion on gross negligence and public policy. The court noted that “[g]ross negligence long has been defined in California and other jurisdictions as either a want of even scant care or an extreme departure from the ordinary standard of conduct.”1 In this instance, the city had attempted to guard itself from liability for any negligent act, which means that the camp and city would not owe a minimal standard of care to the participants.

The court, using past precedent, held that an exculpatory clause, or clause limiting liability, is not enforceable if it affects the public interest. In previous cases, the court held that a valid release of liability is not available for transactions where the party seeking limited liability performs a public service of great importance, holds himself out as willing to perform the service for any member of the public, uses a standardized contract to limit liability resulting in greater bargaining power, and subjects the person or property to supreme control and therefore the risk of carelessness. The transaction between the city of Santa Barbara and the Janeways clearly falls within several of the above categories and was therefore considered a matter of public interest.

The court noted that the right of a party to agree to limit their future liability must be balanced against public policies that seek to encourage a reasonable standard of care while requiring wrongdoers to pay restitution to injured parties. In ruling on whether parties can limit their liability for future gross negligence, the California Supreme Court determined that gross or aggravated negligence should logically result in harsher legal consequences. As such, the court held that as a matter of public policy it was precluded from en­ ­forcing an agreement that failed to adhere to even a minimal standard of care.

The court addressed the defendant’s concerns that a ruling of this nature would jeopardize similar pro­ grams, resulting in fewer and more expensive public recreational programs. The court did not find any evidence in support of the defendant’s predictions. The court pointed to Washington, Massa­chusetts, and Nebraska where similar cases have barred the release of liability for gross negligence but have not jeopardized public recreation programs.

Conclusion
The California Supreme Court did not speak to a party’s ability to contractually limit future liability from ordinary negligence. However, it did determine that where sports and recreation programs are concerned, parties may not limit future liability for gross negligence as a matter of public policy. Allowing a party to limit liability for gross negligence would effectively provide little incentive to act with at least a minimal standard of care, which, as the court pointed out, is in violation of public policy.
    
Endnotes
1. City of Santa Barbara v. Superior Court, 41 Cal. 4th 747, 752 (Cal. July 16, 2007).