Olsen v. Breeze, Inc.

• Decision Date: 31 July 1996
• Docket Number: Nos. C020585,C021766,s. C020585
• Citation: 48 Cal.App.4th 608,55 Cal.Rptr.2d 818
• Court: California Court of Appeals Court of Appeals
• Parties: , 96 Daily Journal D.A.R. 9907 Philip A. OLSEN, Plaintiff and Appellant, v. BREEZE, INC. et al., Defendants and Respondents.

Page 818

55 Cal.Rptr.2d 818

48 Cal.App.4th 608, 96 Daily Journal D.A.R. 9907

Philip A. OLSEN, Plaintiff and Appellant, v. BREEZE, INC. et al., Defendants and Respondents.

Nos. C020585, C021766.

Court of Appeal, Third District, California.

July 31, 1996.

As Modified Aug. 13 and Aug. 21, 1996.

Philip A. Olsen, in pro per, for Plaintiff and Appellant.

Kronick, Moskovitz, Tiedemann & Girard, William A. Kershaw, Robin Leslie Stewart, James P. Wiezel, Sacramento; Law Offices of D. Michael Rust, Sacramento, for Defendant and Respondent Head Sports, Inc.; McKinley & Smith, William C. McKinley, Timothy M. Smith and Evan Eickmeyer, Sacramento, for Defendant and Respondent Trimont Land Company, Breeze, Inc. and Salomon/North America, Inc.

Hancock Rothert & Bunshoft LLP, Paul S. Rosenlund and David A. Greene, San Francisco, for Defendants and Respondents as Amici Curiae on behalf of Defendants and Respondents.

PUGLIA, Presiding Justice.

This appeal concerns the legality of a release from liability required as a condition for purchasing, renting, or obtaining service on ski bindings. For reasons hereafter discussed, we shall conclude the use of such releases in the ski industry does not violate either state unfair competition laws (Bus. & Prof. Code, § 17200 et seq.) or the Consumers Legal Remedies Act (Civ. Code, § 1750 et seq.).

I

Plaintiff, Philip A. Olsen, is an attorney and "avid recreational skier" who for many years has represented in personal injury litigation plaintiffs who sustained injuries skiing. In December 1993, plaintiff took his skis to a shop operated by defendant Breeze, Inc. (Breeze) to be serviced, including the adjustment of his ski bindings. As a condition for the return of his equipment, plaintiff was required to sign a form which described the risks of skiing and released Breeze from any liability for injury resulting from use of the equipment, including injury caused by negligence, breach of warranty, or product defect. ¹ He refused to sign the form and was denied return of his equipment.

The requirement of a release by Breeze is consistent with industry custom. Ski equipment distributors throughout the state offer indemnity to retail and service outlets in the event of injury caused by the failure of ski bindings to release properly but only if the retailer or service provider has obtained the customer's signature on a release form supplied by the distributor, or one substantially similar thereto. This form is a release of liability, similar to that used by Breeze, often absolving both the retailer/service provider and the distributor from legal liability for injuries caused by failure of the equipment.

Plaintiff initiated this action on behalf of himself and all others in the State who own or seek to rent or purchase ski bindings of various brands. Named as defendants are six ski equipment distributors, Salomon/North America, Inc. (Salomon), Head Sports, Inc. (Head), Raichle-Molitor, USA, Inc. (Raichle), Geze Sports Products (Geze), Marker USA, Inc. (Marker), and Atomic Ski USA, Inc. (Atomic), who are alleged to supply "all, or substantially all," the ski bindings sold and rented in the state of California. Also named as defendants are Trimont Land Company (Trimont), the operator of two ski areas in Northern California, Breeze, a retailer/service provider and a class of all others situated similarly to either Trimont or Breeze. The trial court denied plaintiff's motion to certify a defendant class as alleged. Plaintiff does not challenge this ruling on appeal.

The complaint contains two causes of action. The first cause of action alleges violation of the Consumers Legal Remedies Act (Civ. Code, § 1750 et seq.; hereafter CLRA). The second cause of action alleges unfair competition (Bus. & Prof. Code, § 17200 et seq.). Plaintiff alleges it is unlawful and unconscionable for defendants to require customers to sign releases of liability as a condition for obtaining goods or services. The CLRA cause of action is stated on behalf of a plaintiff class, while the unfair competition claim is stated on behalf of plaintiff alone. In addition to the two separately stated causes of action, the complaint contains two counts seeking, respectively, declaratory and injunctive relief.

During the pendency of this litigation, some of the defendants modified the language of their releases to conform with Westlye v. Look Sports, Inc. (1993) 17 Cal.App.4th 1715, 22 Cal.Rptr.2d 781 (Westlye ). In Westlye, we held an express disclaimer of liability or assumption of risk will not insulate a distributor of ski equipment from strict liability for injuries caused by defective products. ²

Based on the modified releases, the various defendants moved for summary adjudication of the unfair competition cause of action and for a determination the CLRA claim is without merit (Civ. Code, § 1781, subd. (c)(3)). The superior court granted these motions as to all defendants except Head and Raichle and entered judgments of dismissal. Plaintiff appeals from these judgments.

The matter proceeded to trial before the court without a jury as to Head and Raichle. The court granted the motion of these defendants to vary the order of proof, permitting the issues whether Head adequately modified its release and whether Raichle is no longer in a position to modify its release to conform to California law to be tried first. Head presented evidence that it changed its release form and communicated this change to its retail outlets. Raichle presented evidence that it is no longer authorized to distribute ski bindings in California. Head and Raichle moved for judgment (Code Civ. Proc., § 631.8). The superior court granted the motions and entered judgments of dismissal. Plaintiff also appeals from these judgments.

Plaintiff moved for an award of attorney fees against Salomon, Breeze and Trimont, contending the action had been the catalyst in inducing these defendants to modify their respective releases to conform to law. The superior court concluded plaintiff was not a prevailing party and denied the motion. Plaintiff appeals this order. We have consolidated the foregoing appeals for all purposes. ³

II

We address first plaintiff's unfair competition cause of action. Business and Professions Code section 17200 (section 17200) defines unfair competition as "any unlawful, unfair or fraudulent business act or practice...." "The 'unlawful' practices prohibited by section 17200 are any practices forbidden by law, be it civil or criminal, federal, state, ormunicipal, statutory, regulatory, or court made. (People v. McKale (1979) 25 Cal.3d 626, 632 [159 Cal.Rptr. 811, 602 P.2d 731].) It is not necessary that the predicate law provide for private civil enforcement. (Samura v. Kaiser Foundation Health Plan, Inc. (1993) 17 Cal.App.4th 1284, 1299 .) As our Supreme Court put it, section 17200 'borrows' violations of other laws and treats them as unlawful practices independently actionable under section 17200 et seq. (Farmers Ins. Exchange v. Superior Court (1992) 2 Cal.4th 377, 383 [6 Cal.Rptr.2d 487, 826 P.2d 730].) 'Unfair' simply means any practice whose harm to the victim outweighs its benefits. (Motors, Inc. v. Times Mirror Co. (1980) 102 Cal.App.3d 735, 740 .) 'Fraudulent,' as used in the statute, does not refer to the common law tort of fraud but only requires a showing members of the public ' "are likely to be deceived." ' (Bank of the West v. Superior Court (1992) 2 Cal.4th 1254, 1267 [10 Cal.Rptr.2d 538, 833 P.2d 545].)" (Saunders v. Superior Court (1994) 27 Cal.App.4th 832, 838-839, 33 Cal.Rptr.2d 438.)

Plaintiff contends the second cause of action states several forms of unfair competition associated with defendants' use of general releases, to wit: (1) imposing unenforceable contract terms; (2) using release forms likely to mislead the public; (3) causing the public to sign agreements they are not likely to understand; and (4) holding themselves out as competent while refusing to accept responsibility for their actions. Plaintiff argues the superior court erred in granting summary adjudication to Salomon, Breeze, Trimont, Atomic, and Marker as these defendants failed to negate all forms of unfair competition alleged.

Of the four categories of unfair competition relied upon by plaintiff, only the first, imposing unenforceable contract terms, requires more than a brief comment. In People v. McKale, supra, 25 Cal.3d 626, 159 Cal.Rptr. 811, 602 P.2d 731, the court concluded it was unfair competition for a mobilehome park operator to require tenants to sign rules and regulations containing unlawful terms. Notwithstanding the defendant's argument that these rules and regulations were not being enforced, the court explained: "When a mobilehome park operator requires tenants to sign park rules and regulations which the park is prohibited by law from enforcing, those tenants are likely to be deceived, and allegations of unfair competition based thereon are sufficient to withstand demurrer." (25 Cal.3d at p. 635, 159 Cal.Rptr. 811, 602 P.2d 731.)

Plaintiff contends the releases at issue are unlawful, cannot be enforced, and hence their use constitutes unfair competition. Citing Baker Pacific Corp. v. Suttles (1990) 220 Cal.App.3d 1148, 269 Cal.Rptr. 709 (Baker Pacific ), plaintiff first argues the releases are unlawful because they are overly broad. Secondly, relying on Westlye, plaintiff argues the releases purport to cover strict product liability claims. Finally, plaintiff argues widespread industry use of general releases is unconscionable.

In Baker Pacific, the court held void as against public policy a release required as a condition of employment which contained terms violative of Civil Code section 1668. (220 Cal.App.3d at p. 1157, 269 Cal.Rptr. 709.) Civil Code section 1668 declares violative of public policy contracts which "have for their object, directly or indirectly, to exempt anyone from the responsibility for his...