Enforceability of a Waiver of Liability
Written on May 18, 2012.
A British Columbia Court of Appeal decision to enforce a waiver of liability has important implications for aviation related businesses that provide services for extreme sports (Loychuk v Cougar Mountain Adventures, [2012] BCJ No 504) . The case itself involved zip-lining and had no aviation component. However the Court’s analysis could be applied to those involved in heli-skiing, sky-diving or other risky activities that have an aviation component.
The appellants, Deanna Loychuk and Danielle Westgeest, signed a comprehensive release before taking part in a zip-line tour operated by the respondent, Cougar Mountain Adventures. Loychuk and Westgeest collided when travelling on the same zip line. A guide sent Loychuk down the zip line but she stopped before reaching the lower platform. Westgeest could not see that Loychuk was suspended on the line before a guide sent Westgeest down the line. Westgeest collided with Loychuk, inuring both. Cougar Mountain admitted that an employee’s negligence caused the accident but said the appellants had signed a release, excluding any liability.
Releases were neither unconscionable nor unenforceable
The releases were not unconscionable or unenforceable at common law. The Court applied Justice Binnie’s analytical framework in Tercon Contractors Ltd v British Columbia (Transportation and Highways), 2010 SCC 4, [2010] 1 SCR 69 to determine whether the releases were enforceable:
1. Does the exclusion clause apply to the circumstances?
2. Was the exclusion clause unconscionable at the time the contract was made?
3. Do overriding public policy concerns exist?
Both parties agreed that the exclusion clause applied to the circumstances.
It was not unconscionable for Cougar Mountain to require a comprehensive release. It is not unconscionable for the operator of the recreational sports facility to require someone wishing to engage in its activities to sign a release that bars all claims for negligence against the operator and its employees. A person can decline to sign the release if he or she does not want to participate on that basis.
Lack of control is not an overriding public policy concern
The Court of Appeal did not recognize any overriding public policy concerns argued by Loychuk and Westgeest. They argued that comprehensive releases should be contrary to public policy because zip-lining is an activity totally within the control of the operator. Zip-liners have no control over how they glide once a guide sends them down a line. However, Frankel J.A. said the public policy concerns failed to justify voiding an agreement that both appellants “knowingly and voluntarily” signed by someone wishing to take part in inherently risky recreational activity. Courts have consistently upheld similar releases in the past. It is up the legislators to change the law.
The measure of a participant’s control in the activity was not an overriding policy factor. A court has residual power to decline the enforcement of an exclusion clause. It can refuse to give effect to an exclusion clause where the party relying on the exclusion clause (1) knew it was endangering the public by providing a substandard product or service or (2) the party was endangering the public by acting recklessly. The conduct must be so reprehensible that it would be contrary to public interest to allow the exclusion clause.