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exculpatory clause enforced for personal injury in NJ but gross negligence survives motion April 20, 2018

KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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exculpatory clause enforced for personal injury in NJ but gross negligence survives motion
April 20, 2018
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exculpatory clause enforced for personal injury in NJ but gross negligence survives motion
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    Plaintiff is a quadriplegic and uses a wheelchair for mobility.  He contracted with a fitness center for personal training and suffered a leg fracture while trying out a new position suggested by the trainer.  The plaintiff sued alleging negligence, negligent hiring, and gross negligence. 
    This case is interesting to you [alarm dealers] because it involves an 
Exculpatory Clause and a personal injury claim.  The fitness center and the employee were sued.  They moved for summary judgment based on the contract exculpatory provision which expressly covered negligence.  Plaintiff's position on the motion was that the Exculpatory clause violated public policy and was void.  The [Federal District Court] judge rendered a well reasoned decision discussing the provision.  Excerpts from the decision follow:
   
 As a threshold matter, like any waiver an exculpatory agreement must “reflect the unequivocal expression of the party giving up his or her legal rights that this decision was made voluntarily, intelligently and with the full knowledge of its legal consequences.  Ordinarily a written contract is sufficient to establish a knowing waiver: “When a party enters into a signed, written contract, that party is presumed to understand and assent to its terms, unless fraudulent conduct is suspected.”
    ... there are no allegations that suggest fraudulent or misleading conduct regarding the waiver. I therefore find, as a threshold matter, that the exculpatory agreement expresses a voluntary waiver.
*6 That is far from the end of the inquiry, however. Although New Jersey courts “do enforce contracts that contain exculpatory clauses,” they will not do so if “such provision proves adverse to the public interest.”
    Whether such an exculpatory provision violates public policy is evaluated under the test.   An exculpatory agreement DOES NOT violate public policy and will be enforced if:
(1) it does not adversely affect the public interest;
(2) the exculpated party is not under a legal duty to perform;
(3) it does not involve a public utility or common carrier; or
(4) the contract does not grow out of unequal bargaining power or is otherwise unconscionable.
    Certain exculpatory waivers are plainly inconsistent with the public interest. For instance, the courts will not enforce a pre-injury release from liability for intentional or reckless conduct, or a release from a statutorily imposed duty.  Even when the subject of an exculpatory agreement is not governed by statute, however, New Jersey courts have considered common law duties in weighing relevant public-policy considerations.  In the private setting, these common law duties are balanced against the right to freely agree to a waiver of a right to sue, which is part of the freedom to contract.

    The judge then dismissed the negligent hiring claim because the Exculpatory Clause covered that claim and also a negligent hiring "theory is used to impose liability “in cases where the employee commits an intentional tort.” New Jersey courts recognize the tort of negligent hiring “where the employe[r] either knew or should have known that the employee was violent or aggressive, or that the employee might engage in injurious conduct toward third persons."
    The judge did not however dismiss the Gross Negligence claim, holding that when the facts are not clear that the conduct did not rise to the level of gross negligence there was an issue of fact that had to be determined by a trier of fact [jury or judge if there is no jury].  
    What's gross negligence?  Well in NJ [and lot of other states] it's:
   
  "gross negligence requires “indifference to consequences,” “may be equated with willful or wanton conduct,” and involves a “reckless disregard for the safety of others"
    The judge reasoned that he could not rule out gross negligence [I think he made a mistake] and held"
    
 I cannot find that the record is so-one sided that the case law standards require a verdict for the defendant on the issue of gross negligence. The issue of gross negligence is highly dependent on the context. The context here is that the plaintiff, as defendants surely knew, was highly vulnerable and that he was relying on their expertise to avoid injury. After his first kneeling attempt did not go well, they pressed him to try it a second time, and injury resulted. The case law does not permit me to conclude that a rational jury could not find gross negligence here. Drawing all all inferences in favor of the plaintiff, I must deny the defendants’ motion for summary judgment on Count 3, the gross-negligence claim.  Case cite: 2018 WL 1726262
United States District Court, D. New Jersey.  Caleb BARTLETT, Plaintiff, v.PUSH TO WALK, Tiffany Warren, et al. Defendants.

    So the case will either settle or proceed and Plaintiff will have to prove gross negligence.  If proper trial strategy is not used Plaintiff may succeed.
    While your employees are not doing physical therapy, you are providing a service that lends itself to claims.  You rely on 
your contracts.  If your contract wording [the exculpatory clause and other protective provisions] is not updated and crystal clear don't expect it to protect you.
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
516 747 6700
www.KirschenbaumEsq.com