When evaluating the enforceability of pre-injury liability waivers for minors most courts distinguish between non-profit and for-profit organizations. This article discusses how the courts in Kentucky, Ohio, and Indiana have addressed pre-injury liability waivers for recreational activities involving for-profit companies.
Kentucky Has Found Pre-Injury Liability Waivers are Unenforceable
In Re Kathy Miller, as Next Friend of Her Minor Child, E.M. v. House of Boom Kentucky, LLC, 3:16-cv-332-CRS, illustrates the divide between non-profit and for-profit organizations in the context of pre-injury liability waivers. In Re Kathy Miller involved a for profit trampoline park, Defendant House of Boom of Kentucky, LLC (“House of Boom”), that required purchasers to sign a waiver of liability releasing it for all risks related to the trampoline park. The waiver included language that released all claims by the purchaser and his or her minor children. The Kentucky Supreme Court, however, held that the pre-injury liability waivers signed by the parent, on behalf of the minor child, were unenforceable.
Kathy Miller purchased tickets for her minor daughter, E.M., to play at House of Boom, where she was subsequently injured. Miller sued House of Boom, which then filed a motion for summary judgment on the basis that Miller waived E.M.’s rights by signing the pre-injury liability release. The Kentucky Supreme Court granted Certification from the Western District of Kentucky to address the question of law presented on the enforceability issue.
The Kentucky Supreme Court, following the majority of jurisdictions, found that the waivers of liability between parents (on behalf of their minor children) and for-profit entities were unenforceable. In analyzing this issue, the Kentucky Supreme Court made a distinction between for-profit and non-profit entities. On one hand, the Court noted that a for-profit entity “has the ability to purchase insurance and spread the cost between its customers. It also has the ability to train its employees and inspect the business for unsafe conditions.” On the other hand, the court reasoned that non-profit entities do not always have this ability.
The Kentucky Supreme Court also noted that public policy precludes a parent from entering into an exculpatory agreement on behalf of their child. Generally under Kentucky law, “parents ha[ve] no right to compromise or settle” their child’s cause of action as that “right exist[s] in the child alone.” Moreover, Kentucky statutory authority suggests that while a parent has the right to raise their child and make education and healthcare decisions for their child, there is no statutory right to enter into contracts on behalf of their child. See KRS 405.020. In addition, a parent has no right to settle their child’s tort claim without court approval or appointment of a guardian, further illustrating a parent has no inherent right to contract on behalf of their child. See KRS 387.125.
Ohio Law Permits Pre-Liability Waivers for Non-Profit Organizations, But Has Not Decided Whether These Waivers are Enforceable Relative to For-Profit Organizations
The seminal Ohio case on liability waivers binding minor children is Zivich v. Mentor Soccer Club, Inc., 82 Ohio St. 3d 367, 1998 Ohio 389, 696 N.E.2d 201 (1998). The facts of Zivich involved a minor child who sustained injuries following a community, non-profit soccer game where the soccer goal fell on the minor. Both the trial court and court of appeals awarded summary judgment to the defendant, finding that the pre-injury liability waiver signed by the parents, on behalf of the minor, was enforceable. The case was ultimately appealed to the Ohio Supreme Court.
The Ohio Supreme Court upheld the lower court’s award of summary judgment, primarily relying on a public policy arguments. First, the Court noted that state legislators have encouraged the sponsorships of sports by passing legislation to promote recreational activities by granting immunity to municipalities, unpaid athletic coaches, and other volunteers. If these non-profit organizations and volunteers could be held liable for recreational injuries, there would be less incentive for recreational non-profit organizations to stay in business.
Second, parents have the right to make parenting decisions on behalf of their children, which is recognized under the Due Process Clause of the United States Constitution. Here, when the minor’s mother signed the release on behalf of her child to play community soccer, she was exercising her parental rights and assumed the risk of physical injury on behalf of her child. The minor’s mother consented to shifting the cost of injury onto herself rather than the volunteers or non-profit organization.
Finally, the Court found that a parent who signs a release does so knowingly and has no real motivation to sign a release. In the event the minor is injured, the parent must pay for medical care and risks financial interests by signing a liability waiver. Furthermore, it is unlikely a parent would sign a release maliciously or not in their child’s best interests because the release generally enables children to participate in activities that the parents and children believe will be fun or educational. Therefore, parents in Ohio have the authority to bind their children to exculpatory agreements in non-profit activities. Notably, Ohio has not decided whether this ruling applies to for-profit recreational activities.
Indiana Has Not Ruled on Whether Pre-Liability Waivers are Enforceable Relative to For-Profit Entities, but Has Found Waivers Enforceable for Non-Profit Organizations
Like Ohio, Indiana also has held that parent-signed liability waivers on behalf of their children are enforceable for non-profits, but has not considered whether such waivers are enforceable as they relate to for-profit organizations.
In 2012, the Indiana Court of Appeals approached the issue of pre-liability waivers involving minors in the non-profit setting. See Wabash County YMCA v. Thompson, 975 N.E.2d 362. This case involved injuries sustained by a minor while he was playing little league baseball at the YMCA. The minor’s parent had executed a contract to participate in little league that included a clause releasing YMCA from any injuries arising from the sport.
The plaintiff argued that liability waivers violate the public policy of protecting minors with respect to contractual obligations. The YMCA argued that if this argument was accepted, all releases signed by parents to allow their children to participate in sporting events would be meaningless. Furthermore, YMCA argued that there was an inherent risk in the minor’s participation in the baseball game that could result in injury, which YMCA was released from.
In coming to its decision, the Indiana Court of Appeals noted that exculpatory agreements are generally enforceable and not against public policy. Here, the Court found that YMCA’s release was valid, citing the Ohio Supreme Court’s Zivich case finding that liability waivers are enforceable in non-profit sport activities. Id., citing Zivich. Moreover, an exculpatory clause “not referring to the negligence of the releasee may act to bar liability for those damages incurred which are inherent in the nature of the activity. The requirement of specificity is only necessary when the risk of harm is a latent danger.” Because the minor’s injuries arose from risk inherent in the nature of playing baseball – in addition to the release language releasing the YMCA from responsibility for any injuries incurred while playing baseball – the Court found that YMCA was entitled to summary judgment.
Will Your Pre-Injury Waiver Bounce Back As Unenforceable?
The recent trend concerning pre-injury liability waivers for minors is that they are unenforceable in the for-profit context. While Ohio and Indiana have not yet considered this exact issue, Kentucky’s ruling is instructive and indicative of recent court decisions also holding these types of releases as unenforceable. In line with this trend, and absent special circumstances, a parent has no authority to enter into contracts on a child’s behalf with a for-profit recreational entertainment entity. Kentucky for-profit businesses that deal in the recreational entertainment industry (e.g., trampoline parks, nerf dart wars, and plastic ball pools) are likely jumping to protect themselves after their pre-injury liability waivers were bounced in the House of Boom case. In light of this recent trend, for-profit businesses should review their liability waivers to ensure compliance with state law and update any release language accordingly.