Release of Liability of Company’s Own Ordinary Negligence Valid

by Haight Brown & Bonesteel LLP
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In Grebing v. 24 Hour (filed 1/29/15, Case No. B255866), the California Court of Appeal, Second Appellate District, upheld the validity of 24 Hour's release of liability for its own negligence and further affirmed that 24 Hour could not be liable for product liability when the plaintiff was injured as a result of exercise equipment failure.

Plaintiff Timothy Grebing obtained a membership at 24 Hour and signed a release of liability agreement. The agreement contained a release of liability provision that stated 24 Hour will not be held liable for any injury resulting from its own negligence.

On May 9, 2012, Grebing was using a low row machine, when the clip connecting the handlebar to a weighted cable failed. This caused the handlebar to break free and strike Grebing in the head, causing injuries.

Grebing filed a complaint against 24 Hour asserting causes of action for 1) negligence; 2) negligent products liability; 3) strict products liability; and 4) breach of the implied warranty of merchantability. Grebing's claims were premised upon the allegation that 24 Hour had negligently assembled, maintained and controlled the low row machine, creating a dangerous condition that resulted in his injury.

24 Hour moved for summary judgment arguing the written release of liability that Grebing signed barred his claims and that as a provider of services, not goods, 24 Hour was not within the chain of distribution for purposes of product liability. The trial court granted 24 Hour's motion finding that the release had clearly stated 24 Hour would not be liable for its own negligence and that there was no evidence of gross negligence on 24 Hour's part. Grebing appealed.

In its review, the Court of Appeal upheld the validity of the signed release because, in the context of recreational and exercise facilities, a release of liability for future ordinary negligence is valid, unless it is prohibited by statute or impairs the public interest. The subject release clearly stated that 24 Hour would not be liable for injury "resulting from any negligence of 24 Hour or anyone on 24 Hour's behalf . . . ." Thus, the Court held this language precluded liability for risks of injury caused by 24 Hour's ordinary negligence and deemed Grebing had assumed responsibility for the risks arising from his use of 24 Hour's facilities and equipment. Specifically, the Court stated, "[t]he release expressly extends to any injury while using any equipment at a 24 Hour facility. Injury sustained while using the low row machine, whether or not the injury was the result of poor maintenance or improper assembly of the equipment, was a risk reasonably related to the use of the exercise facility and the use of the equipment . . . ." The Court further explained that the release would still be valid even if the plaintiff did not know of the particular risk that ultimately caused the injury.

In dispensing with the gross negligence claim, the Court of Appeal affirmed there was no evidence that 24 Hour had been grossly negligent and found that 24 Hour had taken several measures to ensure its equipment was well maintained by conducting daily inspections of the facility.

Finally, the Court determined that 24 Hour could not be held liable on the basis of products liability because the dominant purpose of 24 Hour's membership agreement with Grebing was for the provision of fitness services, not supplying goods.

This appellate decision is significant because it affirms the power of a release of liability provision to relieve an exercise facility operator of its own ordinary negligence. Furthermore, it reaffirms the principle that a company which predominantly provides services, as opposed to goods, cannot be held liable for products liability.

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