Liability Waivers: Fun Facts

It seems like a silly thing to even consider. Descending to a depth of 13,000 feet in the cold, unforgiving North Atlantic ocean in a weirdly amateurish, home-made submersible. I followed the story of its loss with some curiosity, although without real interest. What kind of company slaps a thing like this together, ignoring the safety conventions and the laws of both Murphy and physics, and sends it down full of billionaire adventurers who pay $250,000 per person for the privilege? The answer seems to be: the kind of company that trusts its risk of liability purely to the customers’ signatures on liability waivers.

This morning I read the articles about the loss in the N.Y. Times and the Daily Beast, and both strongly suggested that the company would be building its defense to wrongful death law suits (more essentially, negligence suits) on its supposedly strong liability waiver. That thing certainly seems to mention “possibility of death” everywhere that it is possible to squeeze it in. Oh, if only it were that simple.

My first legal observation was, “those things are usually found to be against public policy, aren’t they?” Well, it turns out that the answer is “yes,” as long as you include the “usually.”

I like to check a bit before I shoot my mouth off, so I consulted Professor Google. I always favor real law websites, so I read a nice article in the National Law Review (June 24, 2023). I’d say that they have also been following events as they unfold.

They also started off by pointing out that liability waivers are unenforceable if in violation of public policy. They dropped in more of the subjunctive than I did by making it conditional on an extra “if.” The article relied quite a bit on a case named Atkins v. Skimwest. Atkins starts with a warning of what is to come, “case law does not favor liability waivers.”

Atkins goes on to say that liability waivers “are not automatically invalid,” but that they will in every case be “strictly construed against the party seeking to rely” on them. The waivers must be ridiculously specific about every single risk that exists and that the customer is waiving. What’s more, the person signing the waiver must have been given the opportunity to bargain over the waiver, to bargain not only over the risks to be waived but also over signing the thing at all! Have you ever heard of that happening? Me neither.

The customers here are people to whom $250,000 is a weekend outing for one. They are billionaires proving once again that it is hard to think of things to do with all of that money. Have any of them actually sought legal advice about the waiver? A good lawyer would advise them to bargain with the dimwits running this company. “Tell you what, I’ll give you $350,000 if I don’t sign the waiver.” The answer is no? “Okay, $500,000.” Still no? No counter offer (“for a million, you can go without the waiver”), no back and forth? You have not been given a chance to bargain in good faith. You must sign, or no deal. You can sign, and the waiver is void for violating public policy. The defense fails.

Just imagine the legal horsepower available to an estate worth billions of dollars. At least when the plaintiffs can be trusted to pay their bills. This should be interesting.