May 21, 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.

Colorado Court of Appeals: Identity of Interest Does Not Apply to Parents of Adult Child

The Colorado Court of Appeals issued its opinion in Maldonado v. Pratt on Thursday, November 17, 2016.

The Pratts and Dennis Pratt II (Pratt Jr.) own adjacent properties near Pueblo, Colorado. Pratt Jr. stored used car parts on his property. He began to suspect that someone was stealing the parts, and on October 16, 2012, he drove to his storage area, and, when he saw three flashlight beams approaching, shot and killed Jacob Maldonado. Pratt Jr. was convicted of negligent homicide and sentenced to six years’ imprisonment.

Maldonado’s estate filed a wrongful death action against Pratt Jr. on September 16, 2014, alleging a single act of negligence in his killing of Maldonado. On April 1, 2015, the Estate moved to amend its complaint to add Premises Liability Act claims against the Pratts, since it had discovered that Maldonado was actually on the Pratts’ property when he was shot. The Pratts filed a motion for judgment on the pleadings and/or summary judgment, arguing the two-year statute of limitations barred the complaint. The Estate countered that the amended complaint related back to the original complaint. The district court disagreed and found that the Pratts did not have actual notice of the lawsuit and would not have expected to be named as defendants in the wrongful death action. The district court granted judgment in the Pratts’ favor.

On appeal, the Estate conceded that the statute of limitations for a PLA claim had run when it filed its amended complaint. However, the Estate contended the new claims related back to the original complaint. The court of appeals disagreed. The court of appeals analyzed the relation-back doctrine, noting that a new claim relates back to the date of the original pleading so long as the new claim or defense arises out of the same conduct, transaction, or occurrence. However, when adding a new party, two additional duties arise: the new party must have received actual notice of the complaint within the time period provided by C.R.C.P. 4(m), and the new party must have known or reasonably should have known that, but for a mistake concerning the identity of the proper party, the action would have been brought against him or her.

The court found that the Estate could not prove the Pratts had actual notice of the complaint against Pratt Jr. The Estate argued that notice could be imputed to the Pratts through the “identity of interest” doctrine. The court found the doctrine inapplicable. The court noted that, generally, the identity of interest doctrine is used for corporate entities. The Estate argued that the Pratts had an identity of interest to Pratt Jr., but the court of appeals disagreed. The identity of interest doctrine generally only applies to families if the children are minor and they share an attorney or insurance policy. Here, Pratt Jr. was an adult who lived separately from his parents. Although they spoke daily before the shooting, Pratt Jr. was taken into custody the day of the shooting and was in the DOC when served with the original complaint. The court of appeals declined to extend actual notice from an assumption that Pratt Jr. would have told his parents about the lawsuit.

The court of appeals affirmed the district court.