Kimberly B. Cheney
Developments in Vermont LawKimberly B. Cheney

Can a Seller Require a Release Exempting it From its Own Misconduct?
Appeared in March 12, 2008 edition of The World.

Are releases valid which say, in effect, "if you get hurt, even if it's our fault - tough luck, you can't sue me?" We've all been asked to sign these things.

Shayne Thompson responded to an ad to test drive a motorcycle. She had a motorcycle endorsement. She signed a form saying she had prior experience with the bike, had examined it, and was familiar with its operation. But, she told the salesman she was a new rider with some experience on a 200 cc bike. The form stated that she waived any claim against the dealer for injury arising out of operation of the bike. The dealer put her on a 750 cc bike, which she promptly crashed because she couldn't control it. She sued the dealer asserting that the dealer was negligent in putting her on such a powerful bike, and the release should be held void as being against public policy.

Four justices of the Supreme Court ruled the release wasn't void as against public policy. The Court had previously ruled that a ski area couldn't exempt itself from negligently maintaining its trails, because landowners have traditionally been responsible for safe premises when they invite someone onto the land to make a profit. But a motorcycle? The Court reasoned (unconvincingly) that this was different. There is no common law governing use of motorcycles, it said. Further, people have the right to contract, and they can choose to take a risk.

On the other hand, the Court ruled the actual wording of the release only exempted the dealer from liability for bike operation, but not from negligently entrusting a powerful bike to a novice. So she got to sue.

Justice Johnson's dissent deftly exposes the weakness of the reasoning of the majority. The common law, she wrote, is based on the principle that a person injured by another should be compensated by the wrongdoer, and that wrongful conduct should be deterred. Generally, a consumer simply has no means to assess the risk, while the seller can both control risks and is in a better position to know what they are. If releases are void, the seller will be more careful. Any enlightened system of justice she commented, cannot permit one contracting party to put that other at the mercy of its own misconduct. Consumer releases should be void. Shayne Thompson v. Hi Tech Motor Sports Inc. 2008 VT 15.