Powell v. American Health Fitness Center of Fort Wayne, Inc.

Decision Date28 April 1998
Docket NumberNo. 02A05-9705-CV-192,02A05-9705-CV-192
PartiesFreda M. POWELL, Appellant-Plaintiff, v. AMERICAN HEALTH FITNESS CENTER OF FORT WAYNE, INC., Appellee-Defendant.
CourtIndiana Appellate Court

SHARPNACK, Chief Judge.

Freda Powell appeals a summary judgment granted to American Health Fitness Centers of Fort Wayne ("American Health"). Powell raises several issues which we consolidate and restate as whether the exculpatory clause in the contract between American Health and Powell released American Health from any liability for injuries Powell sustained while on its premises allegedly caused by the negligence of American Health. We reverse and remand.

The facts most favorable to Powell, the nonmoving party, follow. On September 16, 1993, Powell signed a membership agreement ("agreement") to become a member of American Health. The agreement contained an exculpatory clause which read:

"17. DAMAGES: By signing this agreement and using the Club's premises, facilities and equipment, Member expressly agrees that the Club will not be liable for any damages arising from personal injuries sustained by Member or his guest(s) in, on, or about the Club, or as a result of using the Club's facilities and equipment. Member assumes full responsibility for any injuries, damages or losses which may occur to Member or their guest(s) in, on, or about the Club premises or as a result of using the Club's facilities and equipment. Member agrees that the Club shall not be liable for any loss or theft of personal property in or about the Club premises and does hereby fully and forever release and discharge the Club and all associated clubs, their owners, employees and agents from any and all claims, demands, damages, rights of action, or causes of action present or future, whether the same be known or unknown, anticipated or unanticipated, resulting from or arising out of Member's or Member's guest(s) use or intended use of said Club premises, facilities or equipment."

Record, p. 20B. On August 20, 1994, Powell suffered an injury to her foot while using the whirlpool on the premises of American Health.

Powell filed suit against American Health alleging that her injury was caused by its negligence. American Health filed a motion for summary judgment based upon the exculpatory clause. The trial court granted American Health's motion for summary judgment. The court concluded that there was "nothing ambiguous about the language in paragraph 17;" that Powell knowingly signed the membership agreement; and that, as a matter of law, Powell had released American Health from liability for her claims of injury. Record, p. 45.

Summary judgment is appropriate only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Ind. Trial Rule 56(C). The moving party has the initial burden of proving these requirements. Shumate v. Lycan, 675 N.E.2d 749, 752 (Ind.Ct.App.1997), trans. denied, 683 N.E.2d 595. Once the movant has sustained this burden, the opponent must respond by setting forth specific facts showing a genuine issue for trial; the opponent may not simply rest on the allegations of the pleadings. Stephenson v. Ledbetter, 596 N.E.2d 1369, 1371 (Ind.1992). On appeal, we are bound by the same standard as the trial court and consider only those matters which were designated at the summary judgment stage of proceedings. Shumate, 675 N.E.2d at 752. We do not weigh evidence, but will consider the facts in the light most favorable to the nonmoving party. Reed v. Luzny, 627 N.E.2d 1362, 1363 (Ind.Ct.App.1994), reh'g denied, trans. denied.

Before we address whether the exculpatory clause released American Health from any liability, we consider American Health's argument that Powell has waived this appeal. First, American Health suggests that Powell failed to designate any evidentiary material at the summary judgment stage of proceedings. Powell responds that it relied upon the material designated by American Health. Once evidence has been designated to the trial court by one party, that evidence is deemed designated and the opposing party need not designate the same evidence. T.R. 56(C). Moreover, Powell referred to the exculpatory clause in her plaintiff's response to motion for summary judgment ("response"). We have previously held:

"[w]hether the parties designate [evidentiary material] to the court in the summary judgment motion itself, in a separate filing which designates the material, or in a brief in support of (or in opposition to) the motion is within their discretion. As long as the trial court is apprised of the specific material upon which the parties rely in support of or in opposition to a motion for summary judgment, then the material may be considered."

National Bd. of Exam. v. American Osteopathic Ass'n, 645 N.E.2d 608, 615 (Ind.Ct.App.1994). Thus, Powell sufficiently designated the exculpatory clause to the trial court. The validity of the exculpatory clause as a matter of law is the dispositive issue.

Second, American Health contends that Powell has waived the issue of ambiguity because she failed to present the issue to the trial court during the summary judgment proceedings. However, in her response, Powell argued that one of the genuine issues of material fact was whether she "had knowledge of the exculpatory clause contained in the Membership Agreement...." Record, p. 29. She now claims that because the clause was ambiguous, she did not know that American Health disclaimed any liability for its own negligence. While Powell did not specifically use the term "ambiguous" or "ambiguity" in her response, the ambiguity issue is sufficiently related to whether she knowingly agreed to the exculpatory clause to be considered part of the same argument. Therefore, the issue is not waived.

We now address whether the exculpatory clause released American Health from any liability for injuries Powell sustained while on its premises caused by the alleged negligence of American Health. It is well established in Indiana that "parties are permitted to agree in advance that one is under no obligation of care for the benefit of the other, and shall not be liable for the consequences of conduct which would otherwise be negligent." Marshall v. Blue Springs Corp., 641 N.E.2d 92, 95 (Ind.Ct.App.1994). We have held that "it is not against public policy to enter an agreement which exculpates one from the consequences of his own negligence" where there is no statute to the contrary. Id. Neither party has cited any statute which prohibits health clubs from requiring such contracts from their patrons.

Powell claims that the exculpatory clause is invalid because it is ambiguous. We have previously held that "[w]here the terms of a contract are clear and unambiguous, the terms are conclusive and we will not construe the contract, or look at extrinsic evidence, but will merely apply the contract provisions." Stout v. Kokomo Manor Apartments, 677 N.E.2d 1060, 1064 (Ind.Ct.App.1997) (citing Jackson v. DeFabis, 553 N.E.2d 1212, 1215 (Ind.Ct.App.1990)). A contract is not ambiguous merely because the parties offer different interpretations of the contract terms. Id. Rather, ambiguity exists only when reasonable people reading the contract would arrive at different meanings of the terms. Id.

Powell contends that the clause is ambiguous because "it did not explicitly state that a member was releasing the health center from injuries resulting from the health center's own negligence." Appellant's brief, p. 17. This argument is best understood as one of nonspecificity rather than ambiguity. 1 We have previously held that a principle of specificity exists with regard to indemnity contracts that requires "an express stipulation as to the indemnitee's negligence" for the contract provision to be valid. Indiana State Hwy. Comm. v. Thomas, 169 Ind.App. 13, 346 N.E.2d 252, 263 (1976).

In Thomas, a provision of the contract in question read:


The Contractor shall indemnify and save harmless the State, the Commission, the Executive Director, and all officers, agents and employees of the Commission from all suits, actions or claims of any character brought on account of any injuries or damages sustained by any person or property from any neglect in safeguarding the work, or through the use of unacceptable materials in constructing the work, or because of any act or omission, neglect or misconduct of said Contractor, or because of any claims or amount recovered from any infringements of patents, or for any claim or amount arising, or recovered under the 'Workmen's Compensation Law,' or other law, by-law, ordinance or decree and so much of the money due said Contractor under his Contract as shall be considered necessary by the Commission may be retained for the use of the State. In case no money is due the Contractor, his surety shall be held until such suits, actions, or claims for injuries or damages aforesaid shall have been settled and suitable evidence to that effect furnished the Commission."

Id., 346 N.E.2d at 259 (emphasis in original). In concluding that the provision did not indemnify the State from its own negligence, we held that:

"[r]equiring explicit reference to the indemnitee's negligence in a contractual provision which purports to require indemnification therefor comports well with the rule as to the enforcement of such contracts. By hypothesis, such a provision is enforced only if ' "knowingly and willingly" made....' ...

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