Question: This is one I get a lot when I give presentations suggesting the use of liability releases before allowing people on your property to undertake certain activities like hunting or riding horses. Are these releases enforceable? As one gentleman put it, “Is a liability release worth any more than the paper it’s written on?”
Answer: If drafted correctly, a liability release is enforceable under Texas law and may allow the released party to avoid liablity. Releases, however, are not favored and are narrowly construed against the released party in the event there is any ambiguity. Additionally, reliance on a release constitutes an affirmative defense, meaning that the party relying on the release must prove its validity.
To be clear, a liability release is a contractual agreement between the parties whereby one party foregoes his legal rights to make certain legal claims against the other party. These releases are commonplace and are often used in connection with a variety of activities including snow skiing, skate boarding, and horseback riding.
To be enforceable in Texas, a release must meet the requirements of fair notice, which include (1) satisfying the express negligence doctrine; and (2) being conspicuous.
1. Express Negligence Doctrine
The express negligence doctrine requires that in order for a release to be valid, the releasing party’s intent must be expressed in unambiguous terms within the language of the release. The purpose of this requirement is to ensure that parties understand specifically which claims they are releasing when signing a waiver.
In order to satisfy this doctrine, a release should expressly state the legal claims to which it applies, such as negligence, gross negligence, and strict liability. For example, a release that said, “Party A releases Party B for all losses related to the use of the premises for hunting deer” would likely not be enforceable. Instead, a clause should be more specific, stating that “Party A releases Party B for all claims of negligence, gross negligence, and strict liability related to the use of the premises for hunting deer” would be much more likely to satisfy the doctrine.
Additionally, the enforceability of the release may also hinge upon when it was signed versus when the injury occurred. For example, if a release was signed but an injury did not occur for months or years later, a plaintiff could argue that he or she did not intend to release liability for all time by signing the release so long ago. This could allow plaintiff’s counsel to argue lack of express intent to waive the claims at issue, thereby potentially invalidating the release.
Finally, the release should clearly state the activity to which it applies. This detail will help to undercut a plaintiff’s argument that he or she did not intent to release claims for their specific injury. For example, a release that waives claims for “all activities on the property” may be more problematic than a release that waives all claims for “all injuries incurred while hunting deer on the property.”
Next, under Texas law, a release must be conspicuous. Texas had adopted the definition of conspicuous set out by the Uniform Commercial Code, Section 1.201(10), which states that a clause is conspicuous “when it is so written that a reasonable person against whom it is to operate ought to have noticed it.” The UCC goes on to list several examples of conspicuous terms, including a heading and/or text in capitals equal to or greater in size than surrounding text; contrasting type, font, or color to the surrounding text; and placing the language in a larger type than the surrounding font. Adopting these principles, the Texas Supreme Court has explained that “language in capital headings, language in contrasting type or color, and language in an extremely short document, such as a telegram, is conspicuous.”
Numerous Texas cases have considered this issue, and the results are extremely fact specific. For example, in Dresser Indus., Inc. v. Page Petroleum, Inc., 853 S.W.2d 505 (Tex. 1993), the court found release language non-conspicuous when the language was located on teh back of a work order in a series of numbered paragraphs without headings or contrasting type in a lengthy contract. Similarly, in Safeway Scaffold Co. v. Safeway Steel Prod, Inc., 570 S.W.2d 225 (Tex. App. Houston [1st Dist.] 1978), the court held that the language failed to meet the conspicuous requirement where it was small text in light type on the back of a rental form, surrounded by unrelated terms. On the other hand, a release provision titled “Liquidated Damages and Indemnity” and printed in all capitol letters was found to be conspicuous in Arthur’s Garage, Inc. v. Racal-Chubb Sec. Systems Inc., 997 S.W.2d 803 (Tex. App. Dallas 1999). Likewise, in Quintana v. Crossfit Dallas, LLC, 347 S.W.3d 445 (Tex. App. Dallas 2011), the court found a release valid where it was only two pages long, it used the word “release” and the text was typed in bold, larger font.
Importantly, there are several issues related to liability releases that remain undecided. First, the Texas Supreme Court has not yet ruled on whether a pre-injury liability waiver can waive claims for gross negligence. Nearly all appellate level courts considering this issue in Texas has held that releases may not waive claims for gross negligence as doing so would be against public policy. See, e.g., Smith v. Golden Triangle Raceway, 708 S.W.2d 574 (Tex. App. Beaumont 1986) (holding that release of a defendant’s gross negligence is invalid as against public policy). Conversely, the San Antonio Court of Appeals reached the opposite conclusion in Newman v. Tropical Visions, Inc., 891 S.W.2d 713 (Tex. App. San Antonio 1994). There, the court found that the plaintiff effectively waived her claims for both negligence and gross negligence.
Additionally, the Texas Supreme Court has not ruled on whether a liability release signed by a parent on behalf of a minor child is enforceable. At least one Texas appellate court has held that releases signed by a parent or guardian on behalf of a minor child are not enforceable. See Munoz v. II Jaz Inc. , 863 S.W.2d 207 (Tex. App. Houston 1993). The rationale behind this decision is that Texas law seeks to be especially protective of children and that parents should not be able to waive a child’s personal injury claims.
Liability releases, if drafted correctly, may be enforceable and allow a defendant to avoid liability in the event an injury occurs. Releases must be carefully drafted to ensure they meet the express negligence doctrine by listing out any potential legal claims that could arise and carefully identifying the scope of the release in both activity and time. Further, releases must be conspicuous. I recommend that releases be drafted on a separate piece of paper, rather than included in a larger contractual document, with a bold heading and large font. Finally, because there are still legal issues surrounding releases that remain undecided, it is a good idea to speak with your attorney to ensure that your release is drafted in a manner giving you the best chance of it being upheld if challenged in court.