May 24, 2019

Colorado Court of Appeals: Exculpatory Clauses in Fitness Agreement Did Not Bar PLA Claim

The Colorado Court of Appeals issued its opinion in Stone v. Life Time Fitness, Inc. on Thursday, December 30, 2016.

Summary Judgment—Negligence—Premises Liability Act—Liability Release—Assumption of Risk.

Stone was a member of a fitness club owned by defendants (collectively, Life Time). She fell and fractured her ankle in the club’s women’s locker room after a workout. Stone asserted a general negligence claim and a claim under Colorado’s Premises Liability Act (PLA), alleging that Life Time allowed a trip hazard and dangerous condition to exist and thus failed to exercise reasonable care.

Life Time moved for summary judgment, relying on assumption of risk and liability release language contained in the agreement Stone signed when she joined the club. The district court granted the motion, without distinguishing between the negligence and PLA claims, finding that the agreement was valid and enforceable and that Stone had released Life Time from all the claims asserted in the complaint.

On appeal, Stone contended that the district court erred in entering summary judgment and dismissing her action. As to the negligence claim, the Court of Appeals determined that the PLA provides the sole remedy for injuries against landowners on their property and abrogates common law negligence claims against landowners. Thus Stone could not bring a common law negligence claim against Life Time.

Stone also argued that the exculpatory clauses in the agreement, while applying to the workout areas, did not clearly and unambiguously apply to injuries incurred in the women’s locker room. Exculpatory agreements are generally disfavored. A court must consider four factors to determine whether an exculpatory agreement is valid: (1) the existence of a duty to the public; (2) the nature of the service performed; (3) whether the contract was fairly entered into; and (4) whether the intention of the parties was expressed in clear and unambiguous language. As to the first factor, the Colorado Supreme Court has specified that no public duty is implicated if a business provides recreational services. On the second factor, courts have consistently held that recreational services are neither essential nor a matter of practical necessity. With respect to the third factor, recreational service contracts of this type are generally considered to be fairly entered into. These three factors weighed in favor of the enforceability of the agreement. On the fourth prong, however, in waiving future negligence claims, the intention of the parties must be expressed in clear and unambiguous language. After scrutinizing the exculpatory clauses, the court of appeals concluded that the agreement used excessive legal jargon, was unnecessarily complex, and created a likelihood of confusion. Thus, the agreement did not bar Stone’s PLA claim.

The judgment on the negligence claim was affirmed, the judgment on the PLA claim was reversed, and the case was remanded.

Summary provided courtesy of The Colorado Lawyer.

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