NJ Appellate Court Refuses to Enforce Exculpatory Clause that Waives Ordinary Negligence Claims

Plaintiff sued the YMCA for injuries sustained when he slipped and fell on stairs that he alleged were negligently maintained.  First, let’s get this out of the way: 

The YMCA argued that plaintiff was contractually barred from seeking damages against the YMCA because plaintiff had voluntarily signed an exculpatory clause in his membership agreement.   That clause provided:

I AGREE THAT THE YMWCA WILL NOT BE RESPONSIBLE FOR ANY PERSONAL INJURIES OR LOSSES SUSTAINED BY ME WHILE ON ANY YMWCA PREMISES OR AS A RESULT OF A YMWCA SPONSORED ACTIVITIES [SIC]. I FURTHER AGREE TO INDEMNIFY AND SAVE HARMLESS THE YMWCA FROM ANY CLAIMS OR DEMANDS ARISING OUT OF ANY SUCH INJURIES OR LOSSES.

A New Jersey trial court granted summary judgment dismissing the complaint.   An appellate court reversed.  The appellate court framed the issue as “whether a fitness center or health club can insulate itself through an exculpatory clause from the ordinary common law duty of care owed by all businesses to … invitees[.]”  The court held that it could not.

While the New Jersey Supreme Court upheld an exculpatory clause in Stelluti v. Casapenn Enters., Inc., 203 N.J. 286 (2010), that case was characterized as involving allegations of injury based upon risks inherent in the activity (bike riding in a spin class).  In Stelluti, the New Jersey Supreme Court did not specifically address or decide whether an exculpatory clause may waive ordinary negligence.

The appellate court declined to enforce the YMCA's exculpatory clause, reasoning that it was against the public interest:

Given the expansive scope of the exculpatory clause here, we hold that if applied literally, it would eviscerate the common law duty of care owed by defendant to its invitees, regardless of the nature of the business activity involved. Such a prospect would be inimical to the public interest because it would transfer the redress of civil wrongs from the responsible tortfeasor to either the innocent injured party or to society at large, in the form of taxpayer-supported institutions.

The appellate court also noted that the agreement was presumably a contract of adhesion.

This is a case worth following if appealed to the New Jersey Supreme Court.  And a good teaching case because it lays bare the tension between freedom to contract and overriding concerns about general public welfare.

 Walters v. YMCA, DOCKET NO. A-1062-12T3 (Superior Ct. of N.J. App. Div. Aug. 18, 2014).