BJ's Wholesale Club, Inc. v. Rosen

• Decision Date: 27 November 2013
• Docket Number: No. 99,Sept. Term, 2012.,99
• Citation: 80 A.3d 345,435 Md. 714
• Parties: BJ'S WHOLESALE CLUB, INC. v. Russell ROSEN, Individually, etc., et al.
• Court: Maryland Court of Appeals

435 Md. 714

80 A.3d 345

BJ'S WHOLESALE CLUB, INC.

v.Russell ROSEN, Individually, etc., et al.

No. 99, Sept. Term, 2012.

Court of Appeals of Maryland.

Nov. 27, 2013.

Christopher R. Dunn (Jeffrey T. Brown, DeCaro, Doran, Siciliano Gallagher & DeBlasis, LLP, Bowie, MD), on brief, for petitioner.

Ari S. Casper (Denis C. Mitchell, Stein, Mitchell, Muse & Cipollone, LLP, Washington, DC), on brief, for respondent.

H. David Leibensperger, Esq., Berman, Sobin, Gross, Feldman & Darby, LLP, Towson, MD, for amicus curiae brief of the Maryland Association for Justice.

Argued before BARBERA, C.J., HARRELL, BATTAGLIA, GREENE, ADKINS, McDONALD and IRMA S. RAKER (Retired, Specially Assigned), JJ.

BATTAGLIA, J.

This case requires us to consider the enforceability of a clause, which contained both an exculpatory provision and indemnification language, in an agreement executed by a parent on behalf of his minor son permitting his son's use of a free supervised play area called the “Incredible Kids' Club” (Kids' Club) offered by BJ's Wholesale Club, Inc. (BJ's), a commercial wholesale retail center at its location in Owings Mills, Maryland. The Kids' Club contained a number of different amusement items, including, for instance, a plastic apparatus called “Harry the Hippo” for children to use while their parents shopped.

To use the Kids' Club, BJ's requires parents to sign an agreement, entitled “BJ's Incredible Kids' Club Rules” mandating usage restrictions ¹ and, more pertinent to this matter, also contains an exculpatory clause that provides that:

I hereby acknowledge that the participation in BJ's Incredible Kids Club (the “Play Center”) is a benefit offered to me as a part of my BJ's Wholesale Club membership. I further acknowledge that I have read, understood and I voluntarily agree to abide by all of the rules appearing above and/or rules as posted in the Play Center and registration area. In consideration for this service, I, individually and on behalf of my child, do hereby waive, release and forever discharge BJ's Wholesale Club, Inc.; its subsidiaries and affiliates and their respective agents, employees, officers, directors, shareholders, successors and assigns from any and all claims and causes of action of any kind or nature which are in any way related, directly or indirectly, to the use of Play Center which I may have or that hereafter may accrue including any such claims or causes of action caused in whole or in part by the negligence of BJ's Wholesale Club, Inc., its subsidiaries and affiliates, and their respective agents, employees, officers, directors, successors and assigns. I understand that my child is here at my own risk and expense and agree that neither I nor my child will bring any claim or cause of action of any kind or nature against BJ's Wholesale Club, Inc., its subsidiaries and affiliates and their respective agents, employees, officers, directors, successors and assigns.

Immediately below in the same paragraph is found an indemnification clause:

I further agree to indemnify, defend and hold harmless BJ's Wholesale Club, Inc., its subsidiaries and affiliates and their respective agents, employees, officers, directors, successors and assigns from any claims or causes of action of any kind arising from my or my child's use of the Play Center. By placing my signature below, I acknowledge and agree that I have read this agreement, understood all of the terms and conditions contained herein, and that this agreement will be in full force and effect during each of my or my child's visit to the Play Center. This agreement shall remain in full force and effect at all times whether my child is dropped off at the Play Center by me or any one else.

This language appears in smaller font than the remaining agreement, but is printed in bold letters just above the line for the parent or guardian's signature.²

On July 17, 2005, Russell Rosen executed the “BJ's Incredible Kids' Club Rules,” inclusive of both the exculpation and indemnification clauses, on behalf of his three minor children, including his son, Ephraim Rosen. Approximately fifteen months later, Beily Rosen, his wife, went shopping at the BJ's' Owings Mills location and dropped off then five-year old Ephraim at the Kids' Club where, according to the Rosens' Complaint filed in the Circuit Court for Baltimore County, Ephraim was injured:

7. [T]he play area was under the control and supervision of BJ's and its agents and employees, and BJ's had actual or apparent control of the play area.

8. The play area consisted of a number of different amusement items for children. The entire play area is covered by carpet. In most of the play area, the carpet covers a thick layer of resilient foam padding. In other areas, the carpet was adhered directly to a concrete floor. There were no markings to delineate where the floor was padded and where it was not.

9. On October 22, 2006, Beily Rosen went shopping at BJ's with Ephraim. She left Ephraim in the play area.

10. While in the play area, Ephraim was playing on an elevated plastic play apparatus known as Harry the Hippo.

11. The Hippo was approximately 38? high at its peak and varied in height along the rest of the structure.

12. The Hippo was placed in such a manner that a child who fell forward would land directly on top of the concrete floor covered by only a thin layer of carpet.

13. Ephraim fell off the front of the structure landing head first directly on the concrete floor covered only by a thin layer of carpet.

14. Ephraim was crying profusely after the fall. His mother was notified to retrieve Ephraim from the play area.

15. That day Ephraim was taken to Sinai Hospital in Baltimore, Maryland. A CT scan of his head revealed that Ephraim had suffered a large acute epidural hematoma in the right temporal, and parietal convexity with extensive mass effect.³

16. Ephraim was transferred to Johns Hopkins in Baltimore, Maryland. There he underwent an emergent, right frontal temporal parietal craniectomy for evacuation of the epidural hematoma.⁴ The surgery saved Ephraim's life.

The Complaint plead a cause of action in negligence, asserting that:

17. BJ's had a duty to exercise reasonable care to protect its patrons in the play area from injury.

18. BJ's agents and employees knew or should have known that placing an elevated play structure directly over carpet adhered to a concrete floor would pose a danger to children playing there.

19. BJ's breached its duty of care by placing The Hippo in an area without sufficient padding.

BJ's filed an Answer containing a general denial; after the parties began discovery, BJ's filed a counterclaim against the Rosens, alleging breach of contract for failing to indemnify, defend, and hold BJ's harmless pursuant to the indemnification clause.

Thereafter, BJ's filed a motion for summary judgment under Rule 2–501 ⁵ allegingthat no factual matters were in dispute and that, pursuant to our decision in Wolf v. Ford, 335 Md. 525, 644 A.2d 522 (1994), the exculpatory clause was valid and barred the Rosens' claims as a matter of law.⁶ The Rosens filed an opposition, contending that, among other things, the exculpatory and indemnification clauses were unenforceable, because they violated Maryland's public policy interest of protecting children.

After holding a hearing, Judge Thomas J. Bollinger, Sr., of the Circuit Court for Baltimore County granted summary judgment for BJ's:

The issue before the Court is one of first impression in Maryland. The question is the enforceability of an exculpatory clause signed by one or more of the parents on behalf of their minor child. The Plaintiffs argue that enforcement of such agreements should be void for being against public policy.

Since Maryland has yet to establish any alternative law for adults who sign exculpatory clauses for their children [the trial court] must use the general rule in determining the validity of [the] agreement. Generally, Maryland Courts will uphold exculpatory clauses that are executed by adults on their own behalf. Wolf v. Ford, 335 Md. 525, 535 (1994). “There are circumstances, however, under which the public interest will not permit an exculpatory clause in a contract[ ].” Id. at 531 . “Public policy will not permit exculpatory agreements in transactions affecting the public interest.” Id. at 532 . “The ultimate determination of what constitutes the public interest must be made considering the totality of the circumstances of any given case against the backdrop of current societal expectations.” Id. at 535 .

While this Court recognizes that the Maryland Court of Appeals has intended to create a public interest exception, without further guidance, this Court is not capable of evaluating “the totality of the circumstances” against a “backdrop of current societal expectations.” Id. Consequently, this Court lacks any ability to pronounce public policy grounds to invalidate the clause that Mr. Rosen signed on behalf of his minor child.

(alteration in original).⁷ The Rosens filed a timely notice of appeal in the Court of Special Appeals, and in a reported opinion, the Court of Special Appeals reversed. Rosen v. BJ's Wholesale Club, Inc., 206 Md.App. 708, 716, 51 A.3d 100 (2012).

In so doing, the Court of Special Appeals struck down the exculpation and indemnification clauses, acknowledging that while our decision in Wolf validated exculpatory clauses, “[t]here are circumstances ... under which the public interest will not permit an exculpatory clause in a contract[.]” Id. at 716, 51 A.3d at 105, quoting Wolf, 335 Md. at 531, 644 A.2d 522 (alterations in original). Our intermediate appellate court explored authority from our sister states such as that from New Jersey, Hojnowski v. Vans Skate Park, 187 N.J. 323, 901 A.2d 381 (2006), and Florida, Kirton v. Fields, 997 So.2d 349 (Fla.2008), to bolster its conclusion that an agreement entered into by a parent barring a future negligence claim asserted by a child...