Huber v. Hovey, 91-2000

• Decision Date: 19 May 1993
• Docket Number: No. 91-2000,91-2000
• Parties: Dale HUBER and Karen Huber, Appellants, v. Dennis HOVEY; Nordic Speedway, Inc.; Winneshiek County, Iowa, Fair Board; Winneshiek County, Iowa, Agricultural Association; and K & K Insurance Group, Inc., Appellees.
• Court: Iowa Supreme Court

Page 53

501 N.W.2d 53

54 A.L.R.5th 867

Dale HUBER and Karen Huber, Appellants, v. Dennis HOVEY; Nordic Speedway, Inc.; Winneshiek County, Iowa, Fair Board; Winneshiek County, Iowa, Agricultural Association; and K & K Insurance Group, Inc., Appellees.

No. 91-2000.

Supreme Court of Iowa.

May 19, 1993.

As Revised June 25, 1993.

Rehearing Denied June 16, 1993.

Bruce L. Walker and John E. Beasley of Phelan, Tucker, Boyle, Mullen, Bright & Walker, Iowa City, for appellants.

Marion L. Beatty of Miller, Pearson, Gloe, Burns, Beatty & Cowie, P.C., Decorah, for appellee Dennis Hovey.

Brendan T. Quann and Stephen C. Krumpe of O'Connor & Thomas, P.C., Dubuque, for appellees Nordic Speedway, Inc., Winneshiek County, Iowa, Fair Bd., and Winneshiek County, Iowa, Agricultural Ass'n.

Leo A. McCarthy and C.J. May III of Reynolds & Kenline, Dubuque, for appellee K & K Ins. Group, Inc.

Considered by McGIVERIN, C.J., and HARRIS, LARSON, CARTER, and NEUMAN, JJ.

NEUMAN, Justice.

This case stems from an accident at the Winneshiek County Fairground racetrack, when a car's detached wheel struck and injured plaintiff Dale Huber. The district court granted all defendants summary judgment based on a release Dale signed. We affirm in part, reverse in part, and remand for further proceedings.

The record viewed in the light most favorable to the Hubers reveals the following facts. On September 2, 1989, Dale went to the racetrack to watch a friend race. He had been to races before, though not at this track. Dale saw that spectators were going to the grandstand, instead of the pit area, but he followed his friend to the pit area anyway. He paid the $10 admission fee, and was told to add his signature to a printed form. The form, captioned "Release and Waiver of Liability and Indemnity Agreement," provided:

IN CONSIDERATION of being permitted to enter for any purpose any RESTRICTED AREA ... including ... pit areas ... EACH OF THE UNDERSIGNED....

1. HEREBY RELEASES, WAIVES, DISCHARGES AND COVENANTS NOT TO SUE the promoter, participants ... track operator, track owner, officials, car owners, drivers, pit crews, any persons in any restricted area ... owners and lessees of premises used to conduct the event ... for the purposes herein referred to as "releasees", from all liability to the undersigned, his personal representatives, assigns, heirs, and next of kin for any and all loss or damage, and any claim or demands therefor on account of injury ... whether caused by the negligence of the releasees or otherwise while the undersigned is in or upon the restricted area....

EACH OF THE UNDERSIGNED expressly acknowledges and agrees that the activities of the event are very dangerous and involve the risk of serious injury....

THE UNDERSIGNED HAS READ AND VOLUNTARILY SIGNS THE RELEASE AND WAIVER OF LIABILITY....

The words "I have read this release" were printed in red above each signature line.

Feeling pressured to keep the line behind him moving, Dale signed the form without reading it, and entered the pit area. He was standing about ten feet behind a protective "wheel fence," watching the race, when one of the cars lost a wheel and axle. The wheel tore through the fence, striking and injuring him. Dale sued for damages, and his wife Karen sued for loss of consortium.

The Hubers claimed several parties were negligent: Dennis Hovey, the car's driver; Nordic Speedway, Inc. (Nordic), the lessee of the track; and the Winneshiek County Fair Board and the Winneshiek County Agricultural Association, owner and operator of the racetrack property. The Hubers also claimed the track's insurance broker, K & K Insurance Group (K & K), was liable for negligent inspection of the wheel fence. The defendants jointly moved for summary judgment based on Dale's release. K & K also moved for summary judgment on the ground its inspection created no duty to the Hubers.

The district court granted summary judgment for all defendants, ruling that Dale's release barred both his claim for damages and Karen's claim for loss of consortium. The court declined to rule on whether K & K was entitled to summary judgment based on its affirmative defense that no duty flowed from its inspection.

The Hubers appeal, arguing preliminarily that racetracks have a nondelegable duty to insure their patrons' safety, and that the release Dale signed is ambiguous. They also contend on appeal that the release cannot bar (1) claims by spectators, (2) Karen's consortium claim, and (3) claims against K & K. K & K cross-appeals, asserting that even if the release is no bar to the Hubers' claims, it owes no duty to the Hubers as a matter of law.

I. Our review is for correction of errors at law. Iowa R.App.P. 4. When reviewing a grant of summary judgment we ask whether the moving party has demonstrated the absence of any genuine issue of material fact and is entitled to judgment as a matter of law. Suss v. Schammel, 375 N.W.2d 252, 254 (Iowa 1985). The resisting party must set forth specific facts showing that a genuine factual issue exists. Id. Summary judgment is proper if the only issue is the legal consequences flowing from undisputed facts. Sankey v. Richenberger, 456 N.W.2d 206, 207 (Iowa 1990).

II. Dale asserts that racetracks have a nondelegable duty to ensure their patrons' safety, and that any attempt to insulate themselves from liability violates public policy. We find no merit in this argument. Although track owners and operators have a duty to provide safe premises, see Gibson v. Shelby County Fair Ass'n, 241 Iowa 1349, 1352, 44 N.W.2d 362, 364 (1950), we have repeatedly held that contracts exempting a party from its own negligence are enforceable, and are not contrary to public policy. See, e.g., Bashford v. Slater, 250 Iowa 857, 865, 96 N.W.2d 904, 909 (1959) (injured racetrack flagman's release enforceable).

Dale also seeks to avoid the effect of the release on the ground he did not read it. It is well settled that failure to read a contract before signing it will not invalidate the contract. Small v. Ogden, 259 Iowa 1126, 1132, 147 N.W.2d 18, 22 (1966). Absent fraud or mistake, ignorance of a written contract's contents will not negate its effect. Id., 147 N.W.2d at 22.

III. The release Dale signed is a contract, and its enforcement is governed by principles of contract law. Stetzel v. Dickenson, 174 N.W.2d 438, 439 (Iowa 1970). Construing a contract--determining its legal effect--is a matter of law to be resolved by the court. Farm Bureau Mut Ins. Co. v. Sandbulte, 302 N.W.2d 104, 107 (Iowa 1981).

When construing contracts, courts are guided by the cardinal principle that the parties' intent controls, and, except in cases of ambiguity, that intent is determined by what the contract itself says. Iowa R.App.P. 14(f)(14).

Dale asserts the release is ambiguous. He claims it is unclear whether the parties intended to release claims by spectators, or just participants, and whether the parties contemplated the specific accident that occurred. By its terms, however, the release applies to anyone who, like Dale, enters a restricted area. It makes no distinction between spectators and participants. It clearly identifies the track's owner, operator, and lessee, as well as race participants, as releasees. The release covers personal injuries, including injuries caused by the releasee's own negligence.

The court of appeals has upheld a similar release against the same attack. See Korsmo v. Waverly Ski Club, 435 N.W.2d 746, 747-49 (Iowa App.1988) (release not ambiguous as to the types of injuries the parties intended to include). The district court correctly held the release is not ambiguous as to the particulars claimed by Dale.

IV. Dale next asserts the release is unenforceable against spectators as a matter of law. He argues releases are only valid when signed by a party knowledgeable and informed about the risks. While conceding that participants are presumed knowledgeable, and do not have a reasonable expectation of safety, he argues that spectators are unaware of the risks of pit areas, and cannot sign away their reasonable expectations without being informed of such risks.

We disagree. We believe there is no valid legal distinction between a release signed by a spectator permitted entry into a restricted area, and a release signed by a participant. Courts throughout the country have upheld such releases. See, e.g., Valley Nat'l Bank v. National Ass'n for Stock Car Auto Racing, Inc., 153 Ariz. 374, 378, 736 P.2d 1186, 1190 (1987) (spectators who signed release estopped from arguing release not meant to cover spectators, or that no meeting of minds occurred); Barker v. Colorado Region-Sports Car Club of Am., Inc., 35 Colo.App. 73, 532 P.2d 372, 376 (1974) (spectator's release bars recovery for ordinary negligence); Rudolph v. Santa Fe Park Enters., Inc., 122 Ill.App.3d 372, 374-75, 78 Ill.Dec. 38, 40, 461 N.E.2d 622, 624 (1984) (spectator injured when car drove off track; court enforced release, noting plaintiff's knowledge of risk only relevant if fraud in contract's execution is alleged); Lee v. Allied Sports Assocs., Inc., 349 Mass. 544, 550, 209 N.E.2d 329, 332 (1965) (spectator who failed to read contract and who did not claim fraud was bound by release); Church v. Seneca County Agric. Soc'y, 41 A.D.2d 787, 788, 341 N.Y.S.2d 45, 47 (1973), aff'd, 34 N.Y.2d 571, 310 N.E.2d 541, 354 N.Y.S.2d 945 (1974) (spectator who signed release in order to enter racetrack's infield, where he was injured by an out-of-control car, cannot complain about release's effect).

Courts that have refused to enforce spectator releases rest their decision on the notion that some accidents are so unusual that a fact question is raised as to whether the plaintiff was aware of the risk. See, e.g., Johnson v. Thruway Speedways, Inc., 63 A.D.2d 204, 205-06, 407 N.Y.S.2d 81, 83 (1978) (spectator's collision with maintenance vehicle, which was not traveling on the proper access road and whose...