It is not uncommon for a business to require a parent to sign a waiver before their child may participate in any of the business’s activities. By signing such a release, a parent agrees that the business is not responsible for any injuries that the child sustains as a result of the child’s participation in an activity. These releases also often have language indemnifying the business from any claim brought on behalf of the child. Until now, the law in many states has allowed these businesses, although responsible for the injury, to rely on this waiver and avoid all liability. But in a recent case of first impression, the Maryland Court of Special Appeals ruled that such agreements are void and unenforceable on public policy grounds.
In Rosen v. BJ’s Wholesale Club, Inc., Russell and Beily Rosen were members of the Owings Mills BJ’s Wholesale store. As a perk of membership, the store provided a free, supervised children’s play area, subject to the parent signing a release, which contained both an exculpatory and indemnification clause. Russell Rosen signed that release in July 2005. Then, in October 2006, Beily Rosen dropped her five-year-old son, Ephraim, off at the play center and proceeded to shop in the BJ’s. Sadly, Ephraim fell in the play area and suffered life-threatening brain injuries. The Rosens sued BJ’s, arguing the Club was negligent because it failed to have adequate material protecting the play area floor. In turn, the Club argued that it could not be sued because the Rosens signed the waiver. The trial court sided with the Club and threw out the case.
However, the Court of Special Appeals reversed the trial court’s decision and held for the first time in Maryland that an exculpatory and indemnification agreement executed by a parent on behalf of a minor child with a commercial business violates public policy considerations. Lacking any on-point authority in Maryland, the Court turned to case law from other states to find that the majority of states hold such agreements are invalid and unenforceable because a parent cannot waive a child’s injury claim in advance of an incident. Adopting this majority view, the Court anticipated that its holding will provide incentives for commercial businesses to take reasonable precautions in the operation and maintenance of their facilities and obtain adequate insurance coverage for risk of physical injuries. Critically, the Court noted its compelling policy rationale: that these enterprises are in a better position than minor children to evaluate and eliminate hazards on their property, and are better able to insure themselves adequately against risks that cannot be eliminated. With regard to the agreement’s indemnification provisions, the Court ruled that they were an invalid attempt to circumvent the public policy that invalidated the release language. A copy of the case can be found here.