An interesting case in Georgia arose when a brother brought an action against a home security company for failing to properly notify. The complaint alleged that the decedent, who had Alzheimer’s disease, died from hypothermia after wandering from her home. Despite the alarm being activated at the home, the alarm company failed to contact the decedent’s niece and neighbor as instructed. The next morning, the neighbor found the decedent had succumbed overnight to hypothermia.
The alarm company filed a motion to dismiss claiming, among other things, that the contract signed by the decedent barred the lawsuit or alternatively limited the plaintiff’s recovery.
Georgia has historically afforded great protection to the freedom to contract with another person. The courts are thus bound to enforce contracts as made so long as they are not contrary to law or public policy. Generally, exculpatory clauses in which a business seeks to relieve itself from its own negligence are valid and binding and are not void as against public policy unless they purport to relieve liability for acts of gross negligence or willful or wanton conduct. Because exculpatory clauses may amount to an accord and satisfaction of future claims and waive substantial rights, they require a meeting of the minds on the subject matter and must be explicit, prominent, clear and unambiguous.
The court distinguished this case from other limitation of liability provisions where the court found the provision unenforceable because the provision was on the back of the home security contract or was written in small, uncapitalized font within a subparagraph that also included seemingly unrelated information about the potential liability of police or fire departments.
In this case the contract signed with the defendant alarm company contains several provisions designed to limit the defendant’s liability. These provisions all appear in section 5 of the contract, entitled LIMITATION OF LIABILITY. The first two subparagraphs in section 5 read in part:
A. INSURANCE: WAIVER OF SUBROGATION. I AGREE THAT COMPANY IS NOT PROVIDING ME WITH INSURANCE OF ANY TYPE ... IN THE EVENT OF ANY LOSS, DAMAGE, OR INJURY, I WILL LOOK EXCLUSIVELY TO MY INSURER AND NOT TO COMPANY TO COMPENSATE ME OR ANYONE ELSE. I RELEASE AND WAIVE FOR MYSELF AND MY INSURER ALL SUBROGATION AND OTHER RIGHTS TO RECOVER AGAINST COMPANY ARISING, AS A RESULT OF THE PAYMENT OF ANY CLAIM FOR LOSS, DAMAGE OR INJURY.
B. NO GUARANTEE; NO LIABILITY. COMPANY’S EQUIPMENT AND SERVICES DO NOT CAUSE AND CANNOT ELMINATE OCCURRENCES OF THE EVENTS THEY ARE INTENDED TO DETECT OR AVERT. … COMPANY DOES NOT UNDERTAKE ANY RISK THAT I … MAY BE SUBJECT TO INJURY OR LOSS IF SUCH AN EVENT OCCURS. THE ALLOCTION OF SUCH RISK REMAINS WITH ME, AND NOT WITH COMPANY. I RELEASE, WAIVE, DISCHARGE AND PROMISE NOT TO SUE OR BRING ANY CLAIM OF ANY TYPE AGAINST COMPANY FOR LOSS, DAMAGE, INJURY, RELATING TO THE EQUIPMENT OR SERVICES PROVIDED BY COMPANY.
In determining whether a limitation of liability clause or an exculpatory clause is prominent, courts may consider a number of factors. The important language in the contract is prominent and is repeated in many sections throughout. The court found that the exculpatory provisions of the contract are enforceable. As a result, the plaintiff’s claims for breach of contract, negligence, negligent supervision and training, and fraudulent misrepresentations are barred by the contract in this case and must be dismissed.