An exculpatory clause is a part of a contract or agreement that limits liability for one of the parties if damages or injuries occur as a result of carrying out the contract.
Where might I have encountered an exculpatory clause?
You may find an exculpatory clause in a variety of contracts. “Contract” could even mean an implied agreement between the defendant and the public. A common use of an exculpatory clause is when a facility open to the public exempts itself from liability if a member of the public suffers an injury there or if property damage occurs on the premises. Examples of this type of usage include:
- A public pool or beach with signs indicating there is no lifeguard on duty and that visitors swim at their own risk;
- A parking garage relieving itself of liability if a motorist’s car suffers damage on the premises;
- A gym or health club that does not accept responsibility if a member suffers an exercise-related injury;
- Any location displaying a sign reading “Not responsible for lost or stolen property;” and
- A rental agreement for equipment that relieves the owner of responsibility if the renter suffers injury during use.
Can anybody avoid liability through an exculpatory clause?
A court can overrule an exculpatory clause if it finds the clause unreasonable. In the 1977 case Olson v. Molzen, the Tennessee Supreme Court outlined six factors for consideration when deciding if an exculpatory clause is unreasonable:
- The type of business involved is “generally thought suitable for public regulation;”
- The defendant looking for protection under the clause performs an important and necessary service to the public;
- The defendant promotes its service as publicly available;
- The nature of the defendant’s service grants it an essential bargaining advantage over any member of the public seeking their service;
- The defendant does not offer the public a way to protect themselves against negligent behavior; and
- The transaction placed the plaintiff in the seller’s control, “subject to the risk of carelessness by the seller or his agents.”
One common contract in which exculpatory clauses do not usually apply is in landlord-tenant agreements. Tennessee’s Uniform Residential Landlord and Tenant Act prohibits exculpatory clauses in most housing leases.
Does that mean I will win an injury case?
There are situations in which a court will rule an exculpatory clause invalid, but there are also plenty of cases in which negligent businesses or property owners avoid paying damages because of these clauses. An appellate court in 2016, for instance, ruled in favor of a Tennessee health club when a woman sued after she tripped and fell on a hazardous sidewalk near the building’s entrance.
The plaintiff in the case had signed a waiver relieving the club of liability for injuries at its facilities. The court ruled that this exculpatory clause applied to the front sidewalk, even though the plaintiff assumed it meant equipment in the building.
Do I need a lawyer?
Exculpatory clauses allow parties to avoid paying damages they might otherwise owe. If you have suffered injury because of negligence, an attorney with the Law Offices of Ogle, Elrod & Baril, PLLC will fight to make sure the people responsible for your pain compensate you for it. Call 865-546-1111 for a free consultation.