Maryland Court of Appeals Holds Exculpatory Clauses Valid and Enforceable Against Claims Made by a Minor Child

Posted on by Robert L. Ferguson Jr. in Litigation.

Exculpatory clauses have long been used as a means for protecting commercial enterprises, religious and charitable organizations, and other non-profits from potential liability for the consequences of conduct that would otherwise be negligent.  In Maryland, in the absence of legislation to the contrary, exculpatory clauses are generally valid, and public policy of freedom of contract is best served by enforcing provisions of exculpatory clauses.  Wolf v. Ford, 335 Md. 525, 644 A.2d 522 (1994).  Exculpatory clauses have been held valid and enforceable in a variety of situations.  Winterstein v. Wilcom, 16 Md. App. 130, 293 A.2d 821 (1972) (release and waiver of liability prior to use of a racetrack); Seigneur v. Nat’l Fitness Inst., 132 Md. App. 271, 752 A.2d 631 (2000) (enforcing an exculpatory agreement between a customer and a health club finding that services provided by a health club are not of great public importance or practical necessity).

Recently, the Maryland Court of Appeals upheld the validity and enforceability of an exculpatory clause entered into by a parent agreeing in advance that a defendant was under no obligation of care for the benefit of a minor child and would not be liable for the consequences of conduct which would otherwise be negligent.  In BJ’s Wholesale Club, Inc. v. Rosen (Md. Ct. of Appeals, Nov. 27, 2013), in reversing the Court of Appeals, affirmed the trial court finding that an exculpatory clause releasing and waiving future claims by a minor child was valid and enforceable under Maryland law and that it did not violate Maryland public policy.  In this case, BJ’s Wholesale Club offered its members a free, supervised play center for children.  Parents/guardians would required to sign an agreement that contained an exculpatory clause before leaving their children in the play center.  After signing this agreement, the Rosens left their child at the play center where he later suffered a serious injury.  The parents sued individually and as parents as next friends of their son in the Circuit Court for Baltimore County.  BJ’s moved for summary judgment, which was granted based on the exculpatory clause.

On appeal to the Court of Special Appeals of Maryland, the judgment of the trial court was reversed.  The Court of Special Appeals found that the parents’ release and waiver of future claims by the minor child violated public policy. The Court of Appeals granted certiorari and reversed the Court of Special Appeals. The Maryland Court of Appeals examined a variety of situations where societal expectations were that parents would indeed make significant decisions pertaining to a child’s welfare, citing statutes that enabled parents to exercise that authority on behalf of their minor child in many important aspects of their child’s life including significant physical and mental health decisions as well as education and employment situations.  The Court placed great emphasis on the fact that where a minor child sustained a personal injury, parents were empowered by statute to settle and terminate litigation on behalf of the minor child, citing Md. Code Ann., Cts. & Jud. Proc. Art. §6-405 and Bernstein v. Kapack, 290 Md. 452, 430 A.2d 602 (1981).  The Court of Appeals concluded that it was consistent with public policy to permit the parents, who were otherwise charged with protecting the welfare of the children, to determine what activities and potential risks their child should be permitted to encounter with deference to the parents’ judgment in determining whether the perceived benefit to the child outweighed those risks when executing an exculpatory agreement.  The Court of Appeals rejected the application of the parens patriae doctrine relied upon by the Court of Special Appeals to invalidate the exculpatory clause as being irrelevant to decisions made by a parent on behalf of a child in the course of their parenting role.

By: Robert L. Ferguson, Jr.