JIMMIE ELSKEN, Administrator of the Estate of Patricia Ann Elsken,
Plaintiff-Appellant, v. NETWORK MULTI-FAMILY SECURITY CORPORATION, a foreign
corporation, Defendant-Appellee.

UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT 49 F.3d 1470;; March 6,
1995, Filed

PRIOR HISTORY: [**1] ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR
THE NORTHERN DISTRICT OF OKLAHOMA. (D.C. No. 89-C-263-E). D.C. Judge JAMES
O. ELLISON.
CASE SUMMARY
PROCEDURAL POSTURE: Appellant administrator sought review of the judgment
from the United States District Court for the Northern District of Oklahoma,
which dismissed her suit against appellee security company for breach of
contract, breach of warranties, negligence and deceptive trade practices.

OVERVIEW: Appellant administrator filed a suit against appellee security
company for breach of contract, breach of warranties, negligence and
deceptive trade practices. The district court dismissed her suit. On appeal,
the administrator alleged that the district court erred in concluding that a
service agreement was properly executed and that the parties made the
agreement at arm's length. The court affirmed the judgment dismissing the
administrator's suit and held that the decedent's failure to initial the
reversed side of the agreement and failure to read the agreement did not
make the agreement invalid or preclude a summary judgment. The court held
that a party who signed a contract without reading it could not avoid its
legal effects in the absence of false representation or fraud. The court
determined that no facts or law were presented which created a genuine issue
of material fact that the parties were in unequal bargaining positions
sufficient to render the contract unenforceable.

OUTCOME: The court affirmed the judgment dismissing appellant
administrator's suit and held that the decedent's failure to initial the
reversed side of the agreement and failure to read the agreement did not
preclude a summary judgment.
COUNSEL: Renee Williams, Tulsa, Oklahoma, for Plaintiff-Appellant.

John R. Woodard III (Jody R. Nathan with him on the brief) of Feldman, Hall,
Franden, Woodard & Farris, Tulsa, Oklahoma, for Defendant-Appellee.

JUDGES: Before MOORE and BRORBY, Circuit Judges, and ALSOP, * District
Judge.

* The Honorable Donald D. Alsop, Senior United States District Court Judge
for the District of Minnesota, sitting by designation.

OPINIONBY: BRORBY

OPINION: BRORBY, Circuit Judge.

Jimmie Elsken, the administrator of the estate of her daughter Patricia
Elsken, filed this diversity action against Network Multi-Family Security
Corporation alleging breach of contract, breach of warranties, negligence,
and deceptive trade practices. The district court dismissed the case, and
the plaintiff [*1472] appealed. We exercise jurisdiction pursuant to 28
U.S.C. 1291 and affirm.

Facts

Patricia Elsken rented an apartment from the Windsail Apartment Community in
an attempt to find a safe place to live. Windsail Apartment Community
offered a twenty-four hour alarm system from the Network Multi-Family
Security [**2] Corporation ("Network"). Along with her rental lease,
Patricia Elsken signed a Resident Alarm Services Agreement. The Services
Agreement contained an indemnity clause and a limitation of Network's
liability. Although Patricia Elsken signed the contract, she did not initial
the reverse side of the Services Agreement, and it is alleged that she
failed to read the contract.

Patricia Elsken was found dead in her apartment on the morning of April 11,
1988, an apparent murder victim. Earlier that morning, at 10:33 a.m., her
intrusion security alarm was activated. In response to the alarm, Network
tried unsuccessfully to contact Patricia Elsken by telephone. Unable to
reach Patricia Elsken by phone, Network contacted the apartment manager's
office and advised the manager of the alarm. The apartment manager did not
immediately check Patricia Elsken's apartment, and by the time the apartment
personnel went to investigate the apartment, police and emergency vehicles
had already arrived.

When Patricia Elsken had failed to report to work as expected that morning,
a co-worker called her mother. Jimmie Elsken went to the apartment to check
on her daughter. She arrived at the apartment before the [**3] apartment
personnel came to investigate. She found the apartment in disarray and her
daughter lying facedown, dead. Patricia Elsken had been stabbed repeatedly
and died from a loss of blood.

Procedural History

Jimmie Elsken, a resident of Paris, Arkansas, acting as administrator of the
estate of Patricia Elsken sued Network in federal court in Oklahoma for
breach of contract, negligence, and breach of warranties in its failure to
respond properly to the alarm. She also claimed Network engaged in deceptive
trade practices.

The United States District Court for the Northern District of Oklahoma
certified three questions to the Oklahoma Supreme Court. The three questions
were (1) whether, under Oklahoma law, a contractual limitation of liability
for personal injury is valid and enforceable, (2) whether, under Oklahoma
law, the limitation of liability clause contained in the Residential Alarm
Services Agreement is valid and enforceable, and (3) whether, under Oklahoma
law, the indemnification and hold-harmless clause is valid and enforceable.
Elsken v. Network Multi-Family Sec. Corp., 838 P.2d 1007 (Okla. 1992). The
Oklahoma Supreme Court answered by holding [**4] "[a] contractual
limitation of liability for personal injury in a burglar alarm service
contract may be valid and enforceable ... if the Residential Alarm Services
Agreement submitted was properly executed by both parties, and if the
parties dealt at arms length." Id. at 1008. The Oklahoma Supreme Court also
held "where the intention to indemnify is unequivocally clear from an
examination of the contract, such agreement is enforceable," and therefore,
the indemnification and hold-harmless clause of the Services Agreement was
valid and enforceable. Id. at 1011.

On the basis of the answers to these certified questions, the federal
district court granted Network's motion to dismiss the claims and denied
Jimmie Elsken's motion to reconsider. Ms. Elsken appeals, alleging error in
the district court's conclusions that the Services Agreement was properly
executed and that the parties made the agreement at arms length. Ms. Elsken
also claims the district court erred in applying the limitation of liability
provision to causes of action based upon theories other than negligence.
Finally, Ms. Elsken challenges the district court's denial [**5] of her
motion to reconsider.

Discussion

Although styled as a motion to dismiss, the motion was evaluated on
materials outside of the pleadings and therefore was treated as a motion for
summary judgment in accordance [*1473] with Fed. R. Civ. P. 12(b) and 56.
We review the grant of summary judgment de novo, applying the same legal
standard used by the district court under Fed. R. Civ. P. 56. Applied
Genetics Int'l, Inc., v. First Affiliated Sec., Inc., 912 F.2d 1238, 1241
(10th Cir. 1990).

I. Limitation of Liability Clause

The Resident Alarm Services Agreement between Patricia Elsken and Network
contained a limitation of liability provision. The contract referred to
Patricia Elsken as "Resident," the apartment complex as "Client," and
Network as "Network." Specifically the agreement stated

3.0 LIMITATION OF LIABILITY

3.1 It is understood and agreed that NEITHER CLIENT NOR NETWORK ARE INSURERS
AND THAT INSURANCE, IF ANY, FOR ANY TYPE OF LOSS, SHALL BE OBTAINED BY
RESIDENT
3.4 Resident understands and agrees that if either Client or Network should
be found liable for loss or damage due to the failure of the System in any
respect whatsoever, [**6] including, but not limited to monitoring,
Client's and Network's collective liability shall not exceed a sum equal to
Two Hundred and Fifty Dollars ($ 250.00) and this liability shall be
exclusive. CLIENT AND NETWORK ARE NOT INSURERS AND RESIDENT ASSUMES ALL
RESPONSIBILITY FOR OBTAINING INSURANCE TO COVER LOSSES OF ALL TYPES. The
provisions of this section shall apply if death, loss or damage,
irrespective of cause or origin, results directly or indirectly, to persons
or property, from performance or nonperformance of the obligations imposed
by this Agreement, or from negligence, active or otherwise, of Client,
Network, their agents, employees, legal representatives or assigns.

(Emphasis in original.) Ms. Elsken asserts the district court erred in
dismissing the case when there existed factual questions as to whether the
Services Agreement was properly executed and whether the parties were in
unequal bargaining positions.

A. Execution of the Agreement

Ms. Elsken argues the contract was not properly executed because the
limitation of liability was on the reverse side of the Services Agreement
and Patricia Elsken did not initial the bottom of the reverse side where
there was a [**7] space for initials. Ms. Elsken also submitted, from the
apartment complex manager, an affidavit stating Patricia Elsken did not even
read the Services Agreement. This affidavit was submitted with Ms. Elsken's
motion to reconsider. Jimmie Elsken relies on this allegation to support her
claim that the document was not properly executed.

The district court noted Patricia Elsken signed the first page of the
Services Agreement below a provision articulating a presumption that the
agreement was properly executed, a fact Ms. Elsken does not contest. This
provision stated:

RESIDENT ACKNOWLEDGES THAT RESIDENT HAS READ AND UNDERSTANDS ALL OF THIS
RESIDENT AGREEMENT INCLUDING THE TERMS AND CONDITIONS ON THIS SIDE AND THE
REVERSE SIDE, PARTICULARLY PARAGRAPH 3.0 LIMITATION OF LIABILITY AND AGREES
TO THE AMOUNTS SET FORTH THEREIN.

(Emphasis in original.) Ms. Elsken contends the district court erred because
the trier of fact should decide whether or not Patricia Elsken read the
Services Agreement and whether or not it was, in fact, properly executed.
She avers it was inappropriate for the court to resolve the question of the
effect, if any, of the absence of evidence to rebut the textual presumption.
[**8]

1. Failure to initial a provision in a contract.

It is undisputed that Patricia Elsken signed the front page of the Services
Agreement. On the back of the page, there was a limitation of liability
clause. Although the side of the paper displaying the limitation of
liability clause contained a space for initials, [*1474] Patricia Elsken
did not initial that page. Ms. Elsken argues that, due to this omission, the
limitation of liability clause was not in effect because Patricia Elsken did
not agree to the provision. However, Ms. Elsken has cited no law to support
her contention that the failure to initial a provision renders it void and
ineffective when the front of the document was signed.

Based upon a plain reading of the contract, Patricia Elsken agreed to the
contract in its entirety as written. She signed directly below a statement
in conspicuous, bold capital letters declaring the signing party was
agreeing to the entire Services Contract. This statement further emphasized
the limitation of liability clause on the back of the page. Under Oklahoma
law, "the language of a contract is to govern its interpretation, if the
language is clear and explicit, and does not involve an absurdity." [**9]
Okla. Stat. Ann. tit. 15, 154 (West 1993).

The district court found the language of the Services Agreement was clear
and explicit: "Resident acknowledges that resident has read and understands
all of this resident agreement including the terms and conditions on this
side and the reverse side, particularly paragraph 3.0 limitation of
liability." (Emphasis omitted.) Ms. Elsken cannot avoid the application of
the limitation of liability when her daughter signed directly below a
statement of acceptance of the contract that explicitly incorporates the
provisions on the reverse side of the page. See Vails v. Southwestern Bell
Tel. Co., 504 F. Supp. 740, 745 (W.D. Okla. 1980) (quoting N&D Fashions,
Inc. v. DHJ Indus., Inc., 548 F.2d 722, 727 (8th Cir. 1976)). Patricia
Elsken's failure to initial the reverse side of the Services Agreement does
not preclude summary judgment. The contract itself advised her of the terms
on the back of the page.

2. Failure to read the contract.

Ms. Elsken next argues the contract cannot be enforced because Patricia
Elsken did not read it. However, Patricia Elsken did sign the contract, and
under Oklahoma [**10] law, "'where a party signs a written agreement, in
the absence of false representation or fraud, he is bound by it, although
ignorant of its contents.'" Hicks v. State Farm Mut. Auto Ins. Co., 568 P.2d
629, 633 (Okla. 1977) (quoting All American Bus Lines, Inc. v. Schuster, 199
Okla. 628, 189 P.2d 412, 414 (Okla. 1948)).

There is no evidence presented showing Patricia Elsken was not given the
opportunity to examine and read the contract. The affidavit from the
apartment manager states only that Patricia Elsken "did not read her
[Resident Alarm Services Agreement] and she did not sign the back of it
either."

Furthermore, Ms. Elsken has not claimed Patricia Elsken signed the contract
without reading it due to fraud, misrepresentation, or deceit. Under
Oklahoma law, a party who signs a contract without reading it cannot avoid
its legal effect on the ground that it did not read the contract or that the
contents of the contract were not known to the party. See Darby Petroleum
Co. v. Bowers, 185 Okla. 285, 91 P.2d 663, 666 (Okla. 1937) (releases);
First Nat'l Bank & Trust Co. of El Reno v. Stinchcomb, 734 P.2d 852, 854
(Okla. Ct. App. 1987). [**11] Therefore, Patricia Elsken's failure to read
the Services Agreement does not preclude summary judgment. Regardless of
whether she read the document, it is binding on her because she signed it
and there is no allegation that her signature was induced by duress or
misrepresentation. The contract was therefore properly executed.

B. Bargaining Positions

In answering the certified questions, the Oklahoma Supreme Court noted, "We
do not know whether the parties were in an unequal bargaining position."
Elsken, 838 P.2d at 1010. Ms. Elsken argues that if the Oklahoma Supreme
Court could not determine the parties' respective bargaining power, then
neither could the district court. She contends the district court had
insufficient evidence to make such a finding and therefore dismissal was
improper.

However, Ms. Elsken fails to highlight law and sufficient facts showing the
existence of unequal bargaining power between Network and Patricia Elsken.
She simply notes for the court that the contract was presented to [*1475]
Patricia Elsken "on a take-it-or-leave-it basis" and residents were not
permitted to make changes to the Services Agreement. From these assertions
alone [**12] a fact finder would be unable to determine that Patricia
Elsken was in a bargaining position that would render the Services Agreement
unenforceable. n1 Because no facts or law have been presented to create a
genuine issue of fact that the parties were in unequal bargaining positions
sufficient to render the contract unenforceable, we affirm the district
court's dismissal of the claims.

- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n1 The Services Agreement reveals that Patricia Elsken could have bargained
for a higher limit on liability. This undercuts Ms. Elsken's argument that
the contract was absolutely unnegotiable.

- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -C.
Non-negligence Claims

On appeal, Ms. Elsken also asserts the district court erred by applying the
limitation of liability clause to causes of action other than negligence. In
answering the certified questions, the Oklahoma Supreme Court stated the
"limitation of liability would be binding and enforceable as to defendant's
actions constituting ordinary negligence." Elsken, 838 P.2d at 1010. Ms.
Elsken's complaint, [**13] however, included claims for breach of
contract, breach of warranties, and deceptive trade practices in addition to
a claim of negligence. She argues if the limitation of liability is
enforceable, it can only be applied to her claim of negligence due to the
narrow and clear language of the Oklahoma Supreme Court. Thus, she asserts,
without citing any law to support her position, the district court erred in
dismissing her other claims.

The Oklahoma Supreme Court, in its analysis of the limitation of liability
clause, stated a contract may not exempt anyone from liability, but may
limit their liability. Id. at 1008-09. The court also noted that other
jurisdictions have held the limitation of liability is consistent with
public policy as long as it does not limit liability where the defendant's
conduct constituted gross negligence. Id. at 1009. From this, Ms. Elsken
asserts the district court erred in dismissing her claims of breach of
contract, breach of warranty, and deceptive trade practices. However, the
Oklahoma Supreme Court also noted "'it reasonably follows that since the
contract established the duty, any lawful limitations [**14] in the
contract may also limit the liability of the tortfeasor.'" Id. (quoting
Fretwell v. Protection Alarm Co., 764 P.2d 149, 151 (Okla. 1988)).

The Oklahoma Supreme Court was not addressing claims other than negligence
in answering the certified questions; therefore, its language applied the
limitation of liability clause only to negligence cases. There was no reason
for the Oklahoma Supreme Court to rule on non-negligence claims; therefore,
we have no reason to assume the court restricted the application of the
clause to negligence claims alone. The clause itself states the limitation
applies "if death, loss or damage, irrespective of cause or origin, results
directly or indirectly, to persons or property, from performance or
nonperformance of the obligations imposed by this Agreement, or from
negligence, active or otherwise." (Emphasis added.) From the plain language
of the contract the limitation is not restricted to claims of negligence.

Ms. Elsken also ignores the indemnity clause of the Services Agreement,
which states:

In the event any person not a party to this agreement shall make any claim
or file any lawsuit against Client or Network for any [**15] reason
relating to the duties and obligations of Client or Network pursuant to this
agreement including, but not limited to, the design, installation,
maintenance, operation or non-operation of the System, or the providing of
monitoring, patrol or extended maintenance services, Resident agrees to
indemnify, defend and hold Client and Network harmless from any and all such
claims and lawsuits, including the payment of all damages, expenses, costs
and attorney's fees, whether such claims be based upon alleged intentional
conduct, active or passive negligence, or strict or product liability on the
part of Client, Network, their agents, employees, legal representatives or
assigns.

The Oklahoma Supreme Court held the indemnification clause of the Services
Agreement [*1476] valid and enforceable. Elsken, 838 P.2d at 1011. Since
Ms. Elsken is a third party to the Services Agreement, the indemnification
clause requires Patricia Elsken to indemnify and hold Network harmless from
all of Ms. Elsken's claims for damages. This would include the breach of
contract, breach of warranty, negligence, and deceptive trade practices n2
claims. Because Ms. Elsken has not established [**16] a basis to sue as a
successor, the district court did not err in dismissing each of Ms. Elsken's
claims against Network.- - - - - - - - - - - - - -
Footnotes - - - - - - - - - - - - - - -
n2 The district court correctly dismissed the deceptive trade practices
claim because Ms. Elsken sought only damages and made no claim for
injunctive relief. The Oklahoma Deceptive Trade Practice Act provides for
aggrieved parties to receive injunctive relief. Okla. Stat. tit. 78, 54
(1991). If a party seeks an injunction and proves actual damages then the
party can obtain damages. However, since Ms. Elsken was not seeking
injunctive relief, the claim was not properly before the court.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -II. Denial
of Motion to Reconsider

Ms. Elsken's final argument on appeal is the district court erred in denying
her motion to reconsider. She asserts her motion to reconsider presented the
court with evidence to establish genuine issues of material fact as to
whether or not the Services Agreement was properly executed and whether or
not the parties dealt from equal bargaining positions.

Although not formally addressed [**17] in the Federal Rules of Civil
Procedure, a motion to reconsider is often treated as a Rule 60(b) motion.
See Van Skiver v. United States, 952 F.2d 1241, 1243 (10th Cir. 1991) (if
the motion is served within ten days of the rendition of judgment, it is
treated under Rule 59(e); otherwise the motion is treated under Rule 60(b)),
cert. denied, 121 L. Ed. 2d 51, 113 S. Ct. 89 (1992). An appeal of a
district court's denial of a motion to reconsider "raises for review only
the district court's order of denial and not the underlying judgment
itself." Id. Therefore, we review a denial of a motion to reconsider only
for an abuse of discretion. See, e.g., Cox v. Sandia Corp., 941 F.2d 1124,
1125 (10th Cir. 1991).

Even considering the additional evidence presented with the motion to
reconsider, the apartment manager's affidavit, we have already determined
the district court did not err in dismissing the suit. Therefore, the
district court did not abuse its discretion in denying the motion to
reconsider.

Conclusion

We have found no error in the district court's dismissal of this case. The
contract was properly executed and there [**18] was insufficient evidence
to show unequal bargaining positions. Conclusory allegations that are
unsubstantiated do not create an issue of fact and are insufficient to
oppose summary judgment, and accordingly, we AFFIRM.