You are about to drop your kids off at summer camp.
And the camp director asks you to sign a liability waiver with an extreme exculpatory clause.
If you sign, you are agreeing ‑‑ no matter how your child is injured, you can’t sue in court.
Do you sign?
You have just been presented with an adhesion contract.
Otherwise known as boilerplate.
The camp is seeking to strip you of your legal right to sue in the event your child is injured.
A private firm is seeking to undermine the public rule of law.
What to do?
Margaret Jane Radin has been thinking about these issues.
And she has written a book on the subject.
Radin is a professor of at the University of Michigan School of Law.
What is buried in boilerplate?
“Binding, mandatory pre‑dispute arbitration clauses delete the right to a jury trial and the availability of aggregate remedies – class actions and maybe even aggregate arbitration,” Radin told Corporate Crime Reporter in an interview last week.
“Anytime there are small overcharges that wouldn’t be worth trying to arbitrate individually, the firm can just get away with this.”
“Exculpatory clauses delete redress of grievances. They relieve firms of liability if they cause harm to me or my children through their own negligence.”
“Some of these exculpatory clauses purport to relieve the firm of liability for harm however caused, and that would include reckless or intentional acts. I don’t think the courts would enforce that if it came before them. But there it is in the document.”
“There are also choice of law or choice of forum clauses that direct the courts to permit legal redress only in a jurisdiction chosen by the firm. That means that residents of Washington can be forced to go to Florida or else give up their right to their day in court.”
“There was a famous case on that, Carnival Cruise Lines v. Shute, where our Supreme Court decided that such a choice of forum clause did not violate the constitutional right of due process.”
“Carnival Cruise is routinely invoked by federal courts to immunize boilerplate. In one case in the United States that I read, the choice of law/choice of forum clause said that all cases were to be decided in Gibraltar under Gibraltar law.”
“We have constitutional due process rights of fair play and substantial justice – every person has his or her right to a day in court. Some of these clauses make the right to a day in court pretty iffy. The courts should reconsider their stance here.”
“My conclusion – firms are using boilerplate to delete our legal universe and create their own legal universe. They are replacing the law of the state – which is the law of our society – with the law of the firm.”
What is a consumer to do?
“Consumer organizations could publicize which firms deploy the worst boilerplate so we could vote with our feet where it is possible,” Radin says.
“Reputable firms could start deploying boilerplate that is not so awful.”
“Organization such as Public Citizen or Citizen Works – could start writing boilerplate that would protect the firm from the worst it is worried about without trying to imply to us that its product is awful and they can’t be held liable for anything.”
“Some firms might adopt benign boilerplate.”
There are some cell phone companies that advertise that they have no boilerplate ‑‑ no contract in fact. They are using that as a marketing tool.
“It could be a mini trend,” Radin says. “We could help it along by having public interest groups, consumer organizations, and even ad hoc online organizing by showing firms that a lot of us don’t like this.”
What about acts of civil disobedience ‑‑ like mass burning of boilerplate contracts?
“I think mass burning of boilerplate would be great,” Radin says.
Would it be like a draft card? Would it be illegal to burn boilerplate?
“Boilerplate is not being imposed by the government. We do have free speech rights, I hope. It was illegal to burn the draft card because the Supreme Court decided that the government needed it for appropriate administration of the draft, and that trumped the First Amendment. I’m not sure it’s illegal to burn boilerplate. The company would say – we have plenty of copies of it.”
“I really wish legislatures would make some legal rights non waivable.
For example, some states say – if you have the right to get your security deposit back from a landlord, unless the landlord gives you a damage report, that right is not waivable in boilerplate.”
“If we took the decision about terms away from the lawyers in the firm, the marketing people and the executives might not want to use the most onerous boilerplate.”
[For the complete q/a transcript of the Interview with Margaret Jane Radin, see 27 Corporate Crime Reporter 2(10), January 14, 2013, print edition only.]