Picture this, a family intends to spend a day of fun at a local family entertainment center/sport park. However, before the family is granted admission, the parents must execute a liability waiver on behalf of themselves and their two minor children. In addition, the liability waiver requires that the parents and children waive their rights to a jury trial in favor of arbitration. Unfortunately, while participating in an activity at the facility, one of the minor children suffers injury. The parents file suit on behalf of the minor. The defendant facility moves for dismissal of the suit pursuant to the liability waiver and arbitration agreement. The question before the Court is whether the liability
waiver/arbitration clause are valid. These are the exact issues the Appellate Division was called upon to decide in Hojnowski v. Vans Skate Park, 375 N.J. Super. 568 (App. Div. 2005). In that case, which stemmed from injuries a minor received at a skateboard park, in a 2 to 1 decision, the Court upheld the validity of the arbitration clause, but invalidated liability waivers executed on behalf of minor children. In determining the validity of the arbitration clause executed on behalf of minor children, the Court reasoned that New Jersey policy favors alternative dispute resolution. The Court further relied on N.J.S.A. 2A:24-1, which establishes that contractual provisions requiring the resolution of claims via arbitration are valid and enforceable. To that end, the Court held that despite the fact that the minor child did not execute the contract, he was an intended third party beneficiary of the contract, since the child received the benefit of the entrance to the skate park. Although the Court held that a parent maintains the implicit right to determine the forum that entertain the claims of their minor children, a parent lacks authority to release the claim of a child without specific statutory or judicial authority. The Court opined that this rule is necessary to prevent improvident compromises of a minor’s rights. The Court grounded its position on the premise that the judiciary must act as guardians of New Jersey’s children in the tort context. In reaching its position, the majority rejected the premise that the Court places a greater value on the rights of children over the public interest of the viability of businesses. The Court reasoned that the legislature possesses the inherent power to confer immunity from tort liability on businesses such as Vans Skate Park, which would better serve the public interest than to allow the danger of the impingement of a minor’s right arising out of the operation of external forces that may drive a parent’s decision to execute a pre-tort waiver. Judge Fisher dissented, on the pre-tort waiver issue only. The basis of his dissent stems from his belief that except in cases of parental unfitness, the Court should not overrule the decisions of parents regarding the risk assessment performed when executing pre-tort waivers on behalf of their minor children. While this case is subject to review by the Supreme Court as of right, if the parties so choose, the implication of this decision is far-reaching. Under this decision, the family entertainment industry cannot avoid tort liability for injuries to minors unless it is an industry protected by the legislature, such as the ski industry. Although the Appellate Division in Hojnowski provides sweeping protections for minors, all is not lost. The Court will not disturb agreements to arbitrate these claims, so long as the agreement to arbitrate did arise out of a transaction that is voidable pursuant to the contractual defenses present in both law and equity. Thus, the present state of the law, while subjecting the family entertainment industry to unlimited tort exposure with respect to injuries to minors, it also provides an alternative to expensive litigation to resolve these claims. Based upon the Court’s decision in Hojnowski, it appears pretort liability waivers are disfavored in New Jersey, that they will be strictly scrutinized, and invalidated where it appears that the person executing such a release waived the claims of a minor or a claim that accrues in favor of another individual, and not the person executing the release.

– Eric S. Schlesinger, Esq.