William Rothstein v. Snowbird Corporation

1 William Rothstein, an expert skier, sustained injuries
when he collided with a retaining wall while skiing at Snowbird
Ski Resort. He sued Snowbird, claiming the resort's negligence
caused his injuries. The district court granted Snowbird's
motion for summary judgment and dismissed Mr. Rothstein's
ordinary negligence claim. The district court agreed with
Snowbird that Mr. Rothstein had surrendered his right to recover
damages for Snowbird's ordinary negligence when he became a party
to two agreements releasing Snowbird from liability for its acts
of negligence. In this appeal, Mr. Rothstein challenges the
enforceability of the releases and the district court's summary
judgment based on them. We hold that the releases are contrary
to the public policy of this state and are, therefore,
unenforceable. Accordingly, we vacate the district court's grant
of summary judgment in favor of Snowbird.

BACKGROUND

2 When we review a district court's grant of summary
judgment, as in this case, we review the facts and their
reasonable inferences in a manner most favorable to the nonmoving
party. See, e.g., Progressive Cas. Ins. Co. v. Ewart, 2007 UT
52, 2, 167 P.3d 1011. We present the facts surrounding
Mr. Rothstein's injury in this light.

3 As he was descending Snowbird's Fluffy Bunny run,
Mr. Rothstein collided with a retaining wall constructed of
stacked railroad ties and embedded partially in the mountain.
The collision left Mr. Rothstein with broken ribs, an injured
kidney, a bruised heart, a damaged liver, and a collapsed lung.
At the time of the accident, a light layer of snow camouflaged
the retaining wall from Mr. Rothstein's view. As photographs and
the alleged admission of a resort official suggest, the retaining
wall was unmarked and no measures had been taken to alert skiers
to its presence. Although Snowbird had placed a rope line with
orange flagging near the wall, there remained a large gap between
the end of the rope and a tree, which Mr. Rothstein incorrectly
understood indicated an entrance to the Fluffy Bunny run.
Mr. Rothstein filed suit against Snowbird for its ordinary and
gross negligence.1 Snowbird defended itself by asserting that
Mr. Rothstein had waived his ability to sue Snowbird for its
ordinary negligence when he purchased two resort passes that
released the resort from liability for its ordinary negligence.

4 At the time he was injured, Mr. Rothstein held a season
pass to Snowbird and a Seven Summits Club membership which
entitled him to bypass lift lines for faster access to the
slopes. In order to obtain these benefits, Mr. Rothstein signed
two release and indemnify agreements. The first agreement
provided:

I hereby waive all of my claims, including
claims for personal injury, death and
property damage, against Alta and Snowbird,
their agents and employees. I agree to
assume all risks of personal injury, death or
property damage associated with skiing . . .
or resulting from the fault of Alta or
Snowbird, their agents or employees. I agree
to hold harmless and indemnify Alta and
Snowbird . . . from all of my claims,
including those caused by the negligence or
other fault of Alta or Snowbird, their agents
and employees
(emphasis in original). The second agreement stated:
In consideration of my use of the Snowbird
Corporation (Snowbird) ski area and
facilities, I agree to assume and accept all
risks of injury to myself and my guests,
including the inherent risk of skiing, the
risks associated with the operation of the
ski area and risks caused by the negligence
of Snowbird, its employees, or agents. I
release and agree to indemnify Snowbird, all
landowners of the ski area, and their
employees and agents from all claims for
injury or damage arising out of the operation
of the ski area or my activities at Snowbird,
whether such injury or damage arises from the
risks of skiing or from any other cause
including the negligence of Snowbird, its
employees and agents
(emphasis in original).

5 Citing the agreements, the district court granted
summary judgment in favor of Snowbird on Mr. Rothstein's ordinary
negligence claim. (Mr. Rothstein later voluntarily moved to
dismiss his gross negligence claim without prejudice.) The issue
before us is whether the district court correctly granted
Snowbird summary judgment on Mr. Rothstein's ordinary negligence
claim on the basis of the existence of the release and indemnify
agreements.

DISCUSSION

6 Preinjury releases from liability for one's negligence
pit two bedrock legal concepts against one another: the right to
order one's relationship with another by contract and the
obligation to answer in damages when one injures another by
breaching a duty of care. E.g., Berry v. Greater Park City Co.,
2007 UT 87, 12, ___ P.3d ___. We have joined the majority of
jurisdictions in permitting people to surrender their rights to
recover in tort for the negligence of others. Id. 15. We have
made it clear throughout our preinjury release jurisprudence,
however, that contract cannot claim victory over tort in every
instance. We have indicated that releases that are not
sufficiently clear and unambiguous cannot be enforced. Hawkins
v. Peart, 2001 UT 94, 9 n.3, 37 P.3d 1062. We have also
indicated that we would refuse to enforce releases that offend
public policy. Id. 9. We do not explore the clarity with
which Snowbird communicated to Mr. Rothstein its intention to
release itself of liability for its negligence because we
conclude that the releases offend the public policy of this state
as articulated by the Legislature.

7 We first insisted that preinjury releases be compatible
with public policy a century ago when we affirmed Christine
Pugmire's jury verdict awarding her damages for injuries she
sustained when a locomotive ran into the railroad car in which
she lived and worked as a cook.2 Pugmire v. Or. Short Line R.R.
Co., 92 P. 762, 763, 767 (Utah 1907). Mrs. Pugmire had signed a
release absolving the railroad from liability for any injuries
she might sustain. We affirmed the trial court's refusal to
instruct the jury that Mrs. Pugmire could be bound by the
release, noting that such master-servant agreements "are held to
be void . . . [because] they are against public policy." Id. at
765.

8 By the time it was adopted within the Restatement of
Torts in 1965, the principle that the interests of public policy
could supplant the interests of contract had acquired universal
acceptance. See, e.g., Bisso v. Inland Waterways Corp., 349 U.S.
85, 90 (1955); Am. S.S. Co. v. Great Lakes Towing Co., 333 F.2d
426, 428-29 (7th Cir. 1964); Mohawk Drilling Co. v. McCullough
Tool Co., 271 F.2d 627, 633 (10th Cir. 1959); Gilpin v. Abraham,
218 F. Supp. 414, 415 (E.D. Pa. 1963). Section 496B of the
Restatement (Second) of Torts states, "A plaintiff who by
contract or otherwise expressly agrees to accept a risk of harm
arising from the defendant's negligent or reckless conduct cannot
recover for such harm, unless the agreement is invalid as
contrary to public policy."3 Restatement (Second) of Torts
§ 496B (1965).

9 Our recent encounters with preinjury releases have
uniformly reaffirmed the public policy exception to the general
rule that preinjury releases are enforceable. See, e.g.,
Hawkins, 2001 UT 94, 1 (holding invalid as contrary to public
policy a waiver of liability and an indemnity provision that an
equestrian group required individuals to sign before riding
horses).

10 Despite our willingness to invoke public policy as the
justification for refusing to enforce certain preinjury releases,
we are mindful of the caution with which we must proceed when
contemplating this analytic approach. Ascertaining when a
preinjury release sufficiently offends public policy to warrant
stripping the release of its enforceability can be difficult. As
the example of preinjury releases for negligence amply
illustrates, the quest to identify good public policy in a
particular instance often requires a court to account for two or
more conflicting policies, each laudable, but none of whose
claims on the good can be fully honored. Extracting public
policy from statutes can be no less challenging. Moreover, in
most instances, our proper role when confronted with a statute
should be restricted to interpreting its meaning and application
as revealed through its text. To pluck a principle of public
policy from the text of a statute and to ground a decision of
this court on that principle is to invite judicial mischief.
Like its cousin legislative history, public policy is a protean
substance that is too often easily shaped to satisfy the
preferences of a judge rather than the will of the people or the
intentions of the Legislature. We aptly noted the risks of
relying on public policy rationales when we stated that "‘the
theory of public policy embodies a doctrine of vague and variable
quality, and, unless deducible in the given circumstances from
constitutional or statutory provisions, should be accepted as a
basis for judicial determinations, if at all, only with the
utmost circumspection.'" Berube v. Fashion Centre, Ltd., 771
P.2d 1033, 1043 (Utah 1989) (quoting Patton v. United States, 281
U.S. 276, 306 (1930)). When, however, the Legislature clearly
articulates public policy, and the implications of that public
policy are unmistakable, we have the duty to honor those
expressions of policy in our rulings. Such is the case here.

11 Seldom does a statute address directly the public
policy relevant to the precise legal issue confronting a court.
Here, no statute or other legislative pronouncement of public
policy answers squarely the question of whether a preinjury
release of a ski resort operator's negligence executed by a
recreational skier is enforceable. Few legislative expressions
of public policy speak more clearly to an issue, however, than
the public policy rationale for Utah's Inherent Risks of Skiing
Act, Utah Code Ann. §§ 78-27-51 to -54 (2002 & Supp. 2007),
speaks to preinjury releases for negligence.

12 Our confidence in defining the public policy that the
Act was created to serve is enhanced by the fortuitous fact that
the Utah Legislature introduced the substantive text of the Act
with a statement of public policy. Section 78-27-51 states:
The Legislature finds that the sport of
skiing is practiced by a large number of
residents of Utah and attracts a large number
of nonresidents, significantly contributing
to the economy of this state. It further
finds that few insurance carriers are willing
to provide liability insurance protection to
ski area operators and that the premiums
charged by those carriers have risen sharply
in recent years due to confusion as to
whether a skier assumes the risks inherent in
the sport of skiing. It is the purpose of
this act, therefore, to clarify the law in
relation to skiing injuries and the risks
inherent in that sport, to establish as a
matter of law that certain risks are inherent
in that sport, and to provide that, as a
matter of public policy, no person engaged in
that sport shall recover from a ski operator
for injuries resulting from those inherent
risks.

13 Read in its most restrictive sense, section 78-27-51
simply announces that it is the public policy of Utah to bar
skiers from recovering from ski area operators for injuries
resulting from the inherent risks of skiing, as enumerated in the
Act. So limited, this pronouncement explains nothing that one
could not deduce from the text of the Act itself which by its
terms codifies this policy. Of equal or greater significance are
legislative findings and expressions of public policy that bear
on why it is important to identify the inherent risks of skiing
and insulate ski area operators from liability for injury caused
by them.

14 According to the Legislature, it was necessary to
immunize ski area operators from liability for injuries caused by
inherent risks because they were otherwise being denied insurance
coverage or finding coverage too expensive to purchase. See id.
The Legislature found that the ski industry insurance crisis
imperiling the economic viability of ski area operators was more
than an inconvenient product of market forces. It had become a
matter of public policy concern meriting the intervention of
public policy because, in the words of the Legislature, "the
sport of skiing is practiced by a large number of residents of
Utah and attracts a large number of nonresidents, significantly
contributing to the economy of this state." Id. Thus, the ski
industry's prominent role in Utah's economy justified, in the
view of the Legislature, governmental intervention to ameliorate
the untoward effects of the free market.

15 The central purpose of the Act, then, was to permit ski
area operators to purchase insurance at affordable rates. The
insulation of ski area operators from liability for injuries
caused by inherent risks of skiing was a means to that end.
There is no evidence that, in the absence of a perceived
insurance crisis, the Legislature would have interceded on behalf
of ski area operators merely to clarify the scope of duties owed
skiers who used the ski facilities. The Act is most clearly not,
as Snowbird contends, intended to protect ski area operators by
limiting their liability exposure generally. It is rather a
statute that is intended to clarify those inherent risks of
skiing to which liability will not attach so that ski resort
operators may obtain insurance coverage to protect them from
those risks that are not inherent to skiing.

16 By expressly designating a ski area operator's ability
to acquire insurance at reasonable rates as the sole reason for
bringing the Act into being, the Legislature authoritatively put
to rest the question of whether ski area operators are at liberty
to use preinjury releases to significantly pare back or even
eliminate their need to purchase the very liability insurance the
Act was designed to make affordable. They are not. The premise
underlying legislative action to make insurance accessible to ski
area operators is that once the Act made liability insurance
affordable, ski areas would buy it to blunt the economic effects
brought on by standing accountable for their negligent acts. The
bargain struck by the Act is both simple and obvious from its
public policy provision: ski area operators would be freed from
liability for inherent risks of skiing so that they could
continue to shoulder responsibility for noninherent risks by
purchasing insurance. By extracting a preinjury release from Mr.
Rothstein for liability due to their negligent acts, Snowbird
breached this public policy bargain.

17 There is little to recommend Snowbird's rejoinder to
this interpretation of the public policy provision of the Act.
Snowbird contends that the purpose of the Act is to immunize ski
area operators from liability generally. Since releases of
liability also serve this end, Snowbird argues such releases are
wholly compatible with the Act. This reasoning fails to account
for the Legislature's inescapable public policy focus on
insurance and ignores the reality that the Act's core purpose is
not to advance the cause of insulating ski area operators from
their negligence, but rather to make them better able to insure
themselves against the risk of loss occasioned by their
negligence.

18 The cases cited by Snowbird from other states that
statutorily insulate the providers of recreational activities
from liability for inherent risks and permit preinjury releases
lose their persuasive appeal on close examination. Street v.
Darwin Ranch, Inc., 75 F. Supp. 2d 1296 (D. Wyo. 1999); Clanton
v. United States, 686 N.E.2d 896 (Ind. Ct. App. 1997). Neither
Wyoming's Recreation Safety Act, Wyo. Stat. Ann. §§ 1-1-121 to -
123 (1995), nor the relevant Indiana statute, Ind. Code §
14-22-10-2 (1995), that inform these cases contain public policy
sections or discuss the issue of insurance. Although both
statutes contemplate the lack of liability associated with a
variety of recreational activities, neither contains the kind of
resounding public policy pronouncement present in Utah's Act.

19 Likewise unavailing is Snowbird's assertion that the
freedom to enter into a preinjury release must be preserved in
the absence of express legislative disapproval. Were we to adopt
this reasoning, we would call into question the legitimacy of the
entire body of our preinjury release jurisprudence inasmuch as we
have never declared a preinjury release unenforceable with the
aid of an express statutory mandate to do so. Nor would we be
likely to encounter such an occasion. In the face of an express
legislative prohibition of a preinjury release, a public policy
analysis would hardly be necessary. Moreover, the Act's
expression of public policy does not lend itself to the need for
an additional statement concerning the status of preinjury
releases. The legislative goal expressed in the Act of easing
the task of ski area operators to insure themselves against
noninherent risks creates the presumption that ski area operators
will confront those risks through insurance and not by extracting
contractual releases from skiers. In this setting, the burden
shifts to ski area operators to persuade the Legislature to
expressly preserve their rights to obtain and enforce preinjury
releases.

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http://www.utcourts.gov/opinions/supopin/Rothstein121807.pdf