Ransburg v. Richards

orders, aside the default we decline to set him. See Drew

judgment entered Inc., Quantum Sys. trans. denied (Ind.Ct.App.1996),

595-96 for fail proper was

(holding dismissal discovery order comply

ure to with given additional time party

where the respond expressly and was

within which comply failure to would result

warned that dismissal, or motion for response and no made). time was

additional

Judgment affirmed remanded consistent with this proceedings

further

opinion. J.,

SULLIVAN, J., DARDEN,

concur.

Lenna Twin Lakes RANSBURG d/b/a

Apartments, Appellant-Plaintiff, RICHARDS, Appellee- L.

Barbara

Defendant.

No. 29A05-0101-CV-25. of Indiana. Appeals

Court

June negligence. Specifically,

Twin Lakes' following clause: lease contained the damages Lessor shall not be liable for to person property by or sustained Lessee, servants, family, or agents bis visitors, any or building due appurtenances being repair out of or arising leakage stoppage gas, or steam, water, sewer or plumbing, pipes Smith, Fisher, Bain, Maas & Michael R. wiring from defective or from defective IN, Attorney Ap- for Bishop, Indianapolis, any construction of of the aforesaid. pellant. agreed that the common areas and Coots, Henke & Wheel- Jeffrey Zipes, S. the demise grounds, premises which IN, er, Carmel, Attorney Appellee. for located, facilities, are laun- recreational hallways, dry equipment, rooms and OPINION lots, walkways, stairways, parking lawns equipment and all other areas and to be BARNES, Judge. cccupants used in common all Summary Case apartment building grounds, and Twin Ransburg, Lenna Lakes gratuitously by provided and maintained d/b/a in- ("Ransburg"), brings this Apartments Lessor, appur- and that their is not use terlocutory appeal challenge the trial leased; hereby premises tenant summary judgment of her court's denial hereby expressly agrees and the Lessee negligence in a action filed her motion be made use that the same shall tenant, Lessee, servants, affirm. Barbara Richards. We fomily, agents his or visitors, his, shall be at or their such use

Issue risk, shall, own and that the lessor in no dispositive issue is whether the ex- event, be, thereby or become liable culpatory clause contained the residen- loss, any damage, persons prop- or or tial lease between the is void as property be con- erty, whether such whether, against public policy storerooms, in the common tained result, summary judgment denial of areas, premises ‘ in the or in leased Ransburg proper. favor of portion building other of said Facts though loss dam- grounds, even such May apart- In Richards leased an negligence age shall be caused at ment Twin Lakes. The written lease servants, Lessor, its or em- agents, that agreement provided Twin Lakes ployees. "gratuitously" maintain the common

would added). Appendix (emphasis 78p. Appendix p. agree- areas. 78. The lease January early morning ment In hours of provided further Richards' use facilities, 28, 1999, two approximately of the Twin Lakes it including snowed lot, her parking apartment would own risk." inches. Richards left "[her] When addition, Appendix p. morning, the lease she noticed the side- agreement appeared cleared. It also provided Twin Lakes was walk had been plowed and damages prop- parking not liable that the lot had been persons erty if As Richards walked across damages even such were caused cleared. car, fell slipped lot to her she Our parking standard review for the de nial of a summary judgment on snow-covered ice. motion is the same as it was for the trial court. Miller filed a subsequently Richards R.R., Inc., v. Grand Trunk Western re- against Ransburg. Ransburg action 488, N.E.2d 491 (Ind.Ct.App.2000). We sponded summary judgment with a motion must determine genuine whether is a there alleged she that because of the wherein issue of material fact and whether lease, non-liability clause in the Richards moving party judgment is entitled to as a that any right had "waived she ha[d] matter of law. Id. We must consider the complain injuries damages...." Ap- of pleadings and designated pursu evidence p. opposition her brief pendix 56(c) ant to Indiana Trial Rule without motion, contended Ransburg's Richards deciding weight their or credibility. Id. genuine that there were issues of material Summary judgment granted should be regard fact with to whether Richards had only if such evidence shows that there is to remove the snow and assumed genuine no issue of material fact and that Ransburg's ice. The trial court denied judgment is warranted as a matter of law. motion. Id. Summary judgment generally is inap

Analysis propriate negligence actions. Miles v. Christensen, (Ind.Ct. 643, 724 N.E.2d 645 Ransburg argues that the trial court App.2000), trans. denied. in denying summary judgment erred her motion Richards waived claim Resolving because the question of wheth summary damages. She claims er this lease against is void as judgment granted public policy should have been her turns on fairly balancing the requires favor because "the law that the parties' freedom to contract unambiguous clear and of May policy terms of promoting responsibility for dam 2, 1995, Agreement Residential Lease and ages by negligent one's own acts. corresponding non-liability recognized clause entered Indiana courts have long and respected the freedom to contract. Trot [Ransburg] into and [Richards] be en forced Appellant's as matter of law." Nelson, 1150, ter v. 684 N.E.2d 1152-53 (Ind.1997). p. support Brief 6. In argument, recognize "very of her she We strong principles presumption relies on basic contract enforceability of of contracts recognition validity Indiana's represent freely of ex bargained agree clauses, culpatory where are al ment of the parties." (quoting Conti agree lowed to in advance that is one nental Basketball Assoc. v. Ellenstein En ter., Inc., (Ind.1996)). obligation under no care for the benefit 669 N.E.2d 139 rule, general of the other and shall not be liable for the persons As the law allows Seq, consequences negligent age competent conduct. of full understanding Board, e.g., County liberty contracting, LaFrenz Lake Fair the utmost and their (1977). contracts, Ind.App. 172 freely 360 N.E.2d 605 when entered into She maintains that in legis voluntarily, the absence of are enforced the courts. lation to the it is not contrary, against Candlelight Prop., Operating LLC v. MHC public policy agreement P'ship, to enter into an N.E.2d (Ind.Ct.App. Ltd. that exculpates consequences one from the 2001). is the best interest of her own persons See Marshall v. should not be unneces (Ind.Ct. Springs Corp., Blue 641 N.E.2d 92 sarily restricted their freedom of con Price, App.1994). Peoples tract. Bank & Trust Co. (Ind.Ct.App.1999), public policy declared Indiana," then the court must balance However, in certain cir trans. denied. (I) a court declare an other cumstances five relevant factors: nature (i) contract; subject if it matter of the valid contract unenforceable con wise strength public policy un- policy of travenes Indiana. (iii) statute; derlying the the likelihood Trotter, at 1152-53. bargain that refusal to enforce the court, supreme our aptly As stated (iv) policy; term will further how a term "[plublic policy easily de- serious or deserved would be the for- Trotter, supreme Id. In fined." party attempt- feiture suffered Indiana past, stated that in the courts have (v) ing bargain; to enforce the and the look to the noted that we first Constitu- parties bargaining power relative and tion, and legislature, judiciary the the for freedom to contract. explicit public policy. declarations of Id. (citations omitted). Id. and footnote The declaration, In the absence of such we case before us falls in the "amorphous" clearly to whether it can be next look category contrary of to "otherwise the de- agreement that the has a tendency shown Indiana," and, public policy clared the or is injure public, against public to therefore, we must consider the five fac- good, policy or is inconsistent with sound evaluating tors in this morals as to good the consideration or lease. thing to be done or not to as be supreme court recognizes general done. Id. The further not- Indiana va lidity exeulpatory a contract against pub- ed that whether is clauses. Marsh Dixon, particular (Ind.Ct.App.1999), lie in a would 707 N.E.2d policy situation question dependent of law on the cireum- ns. denied. have stated: We tra particular stances of the case. Id. permitted are Parties make such con- long they knowingly tracts so as are acknowledged Trotter court then willingly made and free from fraud. No approach that this had been reiterated public policy prevent exists to such con- recent cases: However, exceptions tracts. exist where Recently, re-emphasized this Court unequal bargaining have analysis. categorized We three unconscionable, power, the contract is where have situations courts refused to public the transaction affects the inter- private agreements public enforce on utilities, carriers, such as est and other "() policy grounds: agreements types generally thought businesses (i) statute; agreements contravene regulation be suitable for or which are clearly injure tend to necessity thought practical of as for ({) way; agreements some public. some members contrary are otherwise to the declared Bargain General Ctr. v. American Alarm public policy of Indiana." further We 407, 411-12 (Ind.Ct.App. that, depending category, noted on the 1982). Exculpatory generally clauses are approach analysis we must in dif- public policy enforced and are not void on If an agreement ferent manners. is in grounds exceptions unless one of the noted statute, direct contravention of a "then present. responsibility is to court's declare If, however, the contract Noll, void." 115 Ind. Franklin Fire Ins. Co. (1945), agreement falls into the is an ex- App. more amor- 58 N.E.2d 947 phous category contrary ample many years ago of "otherwise where we found a Nothing municipal in the releasing lease ordinance in a commercial ability issue here restricts of an binding, enforce- liability to be from lessor delegate owner responsibility for unconscionable able, void as an and not And, sprinkler systems. given the nature case, signed a In that the lessee contract. subject parties' matter and the Hability from releasing the landlord bargaining power relative and freedom for The lessee sued leaking water. contract, difficulty we have little damage resulting from water damages that, agreeing Appeals with the Court of affirming by leaky pipes. facts, a contract shifting these re- in favor of the land- judgment trial court's sponsibility sprinkler systems lord, we held: to tenant owner is not void and ten- Stipulations between landlord subject public policy. The matter of this ant, a loss determining which shall bear contract is of commercial the lease real nonrepair misrepair arising from estate. Commercial real estate leases tenement, im- and which shall be commonly obligations allocate and risks mune, concern. matters between owner and tenant. For exam- Moreover, upon equal stand two (1993) § ple, Indiana Code 6-1.1-2-4 im- terms; one nor the other is neither poses liability on the owner of real prop- to make any compulsion form of under taxes, erty for property but the tenant is may equally well stipulations; either customarily required pay its share of entry the relation- accept or refuse into real estate taxes on leased commercial tenant. We think it ship of landlord and property. agree We also that there is not con- public policy clear that does inequality bargaining no evidence of immunity voluntarily clause demn the power impingement on freedom to agreed upon by parties. contract here. We hold that on this record, public policy there was no im- that Frank- Ransburg argues Id. at 951. pediment parties agreeing that Fire is still the law in lin Indiana responsible for tenant would be main- case, applied be to this which would must taining system. fire sprinkler non-liability in the in the result Fazli, Cut, Inc. Fresh absolving Ransburg from lease liabili- (citations omitted). (Ind.1995) The the incident. ty for Franklin Fire court also limited its conclu

The facts of the Franklin Fire case are was not unconscionable sion the lease those clearly distinguishable may from before stating, say do not that there "We a dispute The in that case involved cireumstances which could us. not be facts and end, averred, us, upon parties lease. To that but not now before commercial in be warranted power because which the court would equal bargaining were of entities, a contained similar and the they corporate holding were both null and as uncon in a lease would be void necessity a seeking lessee was not basic 58 N.E.2d at 949. scionable." Id. life, damages for namely shelter. The to recover were sought which the lessee Furthermore, finding that the lease inventory, not for the loss of commercial against public policy, the Franklin was not injuries. personal supreme Our a York part upon court relied in New Fire recently a in a com- has more held release were not matters case that held that leases not mercial lease enforceable and Kirshenbaum concern. See Co., Advertising 258 N.Y. public policy, emphasized but General Outdoor (1932). then 180 N.E. Since matter: lease concerned commercial injury premises part, leased prohibit a statute has enacted New York theft, arising as the one person property clauses such ing exculpatory fire, vandalism, a violation of casualty occurring case as found in this Therefore, although the Franklin building. LAND- policy.1 premises or the precedential some FOR, still hold Fire case LORD IS NOT RESPONSIBLE authority in commercial persuasive GUARANTEE, THE AND DOES NOT TENANT, cases, it is not control we find SAFETY OF TENANTS lease concerning ling in a case GUESTS, FAMILY, EMPLOYEES, lease. AGENTS, OR INVITEES. TENANT THE AGREES TO LOOK SOLELY TO exculpatory clause considered an

We PUBLIC POLICE AUTHORITIES v. NHP Vertucci a residential FOR AND PROTECTION. SECURITY (Ind.Ct.App. N.E.2d 604 Mgmt. THAT BE ANY MAY SECURITY 1998), sued the landlord for where a tenant THE PROVIDED IS SOLELY FOR sexually injuries when she sustained OF LANDLORDS apartment complex's at her PROTECTION assaulted by a non-resident of the PROPERTY.... swimming pool argued the tenants complex. appeal, On (emphasis original). at 606 granting erred in sum that the trial court disagreed as to whether the sexual in favor of the landlord mary judgment "casualty" the mean- was a within assault designated evidence raised because their that an ing provision. of this We held concerning material fact genuine issues of act such assault would intentional as the gratuitously assumed whether the landlord and, a "casualty," not be considered there- criminal protect them from the fore, that the clause did non-residents, the land of whether actions or prevent having the landlord from as- duty, this and whether the lord breached from suming duty protect a to the tenant in resulted proximately landlord's breach party. the criminal actions of a third The landlord claimed the sexual assault. Although the case involves a Vertucei any liability on its that the lease disclaimed lease, distinguishable it too is tenants, that it had injuries for part today. The exeul- from the case before us duty protect against to an no common law sought in to by patory attack a third clause at issue Vertuceet? unforeseeable criminal "in- liability it not assume such a the landlord from for party, and that did insulate signed by the duty. agreement jury person property arising The lease to or from following provision: theft, vandalism, fire, casualty occurring tenants contained the Landlord, premises building." in the or the Id. As agrees Tenant its em- such, not ployees, agents shall be liable for landlord did not seek a blanket the Ransburg Tenant, negligence release for its own as injury any damage or to Ten- addition, enforceability of did here. the agents, employees, or family, ant's public policy as a matter of guests, any person entering or to clause In- building of which the not at issue and was not addressed. premises or the lessor, 5-321, negligence § Property from the his 1. See N.Y. Real which opera- agents, employees, servants or states: covenant, premis- the demised Every agreement or understand- tion or maintenance containing property the de- es or the real ing to in or in connection with or collateral - premises deemed to be void mised shall be property exempting real lease of wholly against public policy and unen- liability damages injuries lessor from for resulting person property by or forceable. to caused in. stead, merely sought public policy apparent [Tlhe to have conflict tenants with the freedom of contract argument scope fall outside the assault exculpatory in real-estate' lease clause that the "casualty" such term cases, namely, that a landlord should be negligence ac- prevent would negligent liable for the breach of a agreed, We the landlord. against tion tenant, which is owed his is subser- pro- action to negligence permitted vient to the person doctrine has question never addressed ceed. We the right freely contract about his provision public violated whether the cases, especially affairs. Some the older did not at- policy because ones, have reasoned that the relation- from dam- insulate the landlord tempt to ship of landlord and tenant no its own ages caused interest, public event matter of but is holding controlling is not evalu- Vertucei affair, purely private so that such enforceability of the clause in ating cannot be held purely clauses void on case. instant policy grounds, . Perovich, Annotation, D. Validity John whether exceul- question Because the Exculpatory Exempting Clause in Lease insulat clauses residential leases patory Liability, Lessor 49 A.L.R.3d lability personal landlords from ing (1978). the land injuries purportedly application princi- However the of these are void as lords' in all contexts is not warranted. As ad specifically has never been policy ples Supreme stated Court of Wisconsin: Indiana, we look to the other dressed application The unconsidered considered this is jurisdictions have contract, principle of freedom of even differing conclusions. and reached sue when the rules of accompanied strict issue, majority There is no rule construction, always justified is not decisions, conflicting numerous deci "only extenuating where there are cireum- with contracts of indemni sions concerned degree stances which affect the damage un ty, relating property cases actually which that freedom exists. leases, disposition and a der business Therefore, opinion we are of the that the exeulpatory the courts to emasculate such that into ac- better view is which takes clauses means of strict construction." particular count actual effect of the the Corp., v. United Homes 79 McCutcheon question clause in and that the facts and 1093, 443, 447-48, 486 P.2d 1096 Wash.2d upon cireumstances attendant the cre- (Wash.1971). relationship. ation of the landlord-tenant underlying argument the The rationale v. College Mobile Home Park & Sales enforceability for of such clauses has often 514, 519, 241 Hoffmann, 72 Wis.2d N.W.2d doctrine of freedom upon been based 174, A number of growing 177 (1976). of contract and the view lease terms exculpatory similar claus states have held matter. This reason- purely private policy are a concerns and to public es to offend be unenforceable.2 as follows: ing has been summarized See, Co., Stanley Creighton (1978) (en eg., v. 911 P.2d 247 573 P.2d 143 Cal.Rptr. Buckner, Sales, (Colo.App.1996); banc); College v. 705 Home Park & Mobile Crawford (Tenn.1992); Taylor Leedy 839 S.W.2d 754 Hoffmann, 241 N.W.2d Inc. v. 72 Wis.2d (Ala.1982); (1976); Sys., Cappaert Kinkaid v. Avis Rent-A-Car So.2d 763 174 & (Fla Junker, (Miss.1982); .App.1973); Crowell v. 281 So.2d 223 413 So.2d 378 Henri Dallas, Housing S.W.2d 887 Auth. Ventures, Inc., v. Marin 20 Cal.3d oulle of clause, a lessor of tory which relieves Washing- of Supreme Court In exculpating injuries lability personal a for caused ton held multifamily dwelling com- a purely "personal landlord of is a negligence, its own injury to lessee or liability for from plex and "not a matter of private affair" premises was void entering the anyone public interest." McCutcheon, 79 policy. in an era longer We no live of 447-48, In P.2d at 1096. Wash.2d private rooms in a occasional rental of found: the court holding, so grocery. In home or over the corner relationship it landlord-tenant In the relatively span years short of 30 require extremely meaningful has public's expanded use of rental units itself, exculpate attempt a landlord's dramatically imagination ... It takes no of its own liability for the result from a to see that a business which onee had greatly fall below the not negligence, living impact upon minor habits set law. As standard major citizenry developed has into a earlier, a residential tenant indicated directly touching enterprise commercial multi-family in a modern lives who of thousands of the lives hundreds wholly de- complex is almost dwelling upon it for shelter. people depend who landlord for the rea- upon the pendent Thus, merely with the we are not faced the "common condition of sonably safe duty construing provi- theoretical However, a clause which exeul- areas". specifically in an isolated contract sion liability to les- its the lessor pates bargained by one landlord and one see, les- personal for injuries affair. negligence, only purely private tenant as a Con- acts of own sor's by the imposed realistically, the standard we are asked to lowers sidered law, effectively destroys clause, it exculpatory gen- common an construe obligation landlord's affirmative im- use of which have an eralized areas" maintain the "common keep upon potential thousands of ten- pact condition for the reasonably safe in a cireumstances, it these ants. Under tenant's use. cannot be said that such longer no liable for a lessor is

When affair" or "purely private clauses are standards of affir- failure to observe they a matter of are "not conduct, any conduct mative interest." an by virtue of amounting negligence, (foot- 449-50, P.2d at 1096-97 Id. at lease, the in a stan- exculpatory clause omitted). negli- nor ship. Neither the standard lability for limiting tial lease the landlord's can in genee abstraction. exist to its tenants was void as v. Buck public policy. against Id. The court further reasoned: Crawford (Tenn.1992). Furthermore, present ner, ignore one must In so 839 S.W.2d 754 a court concluded that residen doing, an the day say exculpa- realities to that such 301, (1966), 1973); (Texas v. 219 A.2d 463 McCutcheon v. United Homes Kuzmiak 443, (1971); 575, Corp., 79 Wash.2d Brookchester, Inc., 486 P.2d 1093 N.J.Super. 111 33 Island-Carrollsburg Tenants Council Tiber Shaka, (1955); Papakalos v. 91 N.H. 425 of A.2d DeFranceaux, F.Supp. 560 Square v. 305 (1941). 18 A.2d 377 Arovitch, (D.D.C.1969); Galligan 421 Pa. cancern, not landlord public charges matter of who the same rent tial lease is a and sign court asks the tenant to matter. Id. at 757. 'The the same stan- private a words, dard form In of business was an lease. other type noted that modern standard form lease in public regulation, particu for es- area suitable Illinois, sence an Maryland, in adhesion contract.... A rea- larly states such person equal sonable with bargaining Massachusetts, New York that had power accept would not a term legislation regulating whereby the residen enacted they injured or their children relationship. The tial landlord-tenant - killed, they further that residential land would have no noted recourse guilty party. shelter, a offer which is basic neces lords life, sity people to more than a million Taylor Leedy & So.2d and stated: statewide (Al.1982) (Faulkner, concurring special J. is self-evident that a residential [It ly). judge That quote went in engaged performing landlord is a ser- Frankfurter, stating part: Justice great importance public, vice But any principle is there which is more practical a matter of ne- which is often firmly farailiar or more embedded cessity public. members some history of Anglo-American law than the addition, a residential landlord holds basic doctrine that the courts will not willing perform a service itself out as permit themselves to be used as instru- any public who seeks member inequity injustice? ments of Does it. any principle our law have uni- more application versal than the doctrine that that as Id. at 758. The court also stated in, courts enforce transactions nature of the result of the essential service will which the positions par- relative setting and the economic transac- tion, ties are such that one has unconsciona- a residential has decisive landlord bly advantage taken of the necessities of advantage bargaining strength against the other? principles These are not for- member of the who seeks its eign to the law of contracts. Fraud and superior bargaining services. Due to its physical only grounds duress are not the position, a residential landlord confronts upon which courts refuse to enforce con- with standardized adhesion primitive tracts. law is not so exeulpation, contract of which no contains injustice every except it sanctions brute provision whereby pay a tenant can addi- spe- fraud. downright force and More protection tional reasonable fees to obtain cifically, generally the courts refuse to from the landlord's The court lend themselves to the enforcement of a found definition party "bargain" which one has property places person and the unjust- of the economic ne- ly advantage taken landlord, the control of tenant under cesgsitiesof the other. subject to the risk of carelessness agents. landlord and its v. Bethlehem (quoting United States 62 S.Ct. Corp., Steel U.S. have the un- emphasized Other courts (1942) (Frankfurter, L.Ed. 855 J. dissent equal bargaining power between residen- ing)). judge tial and tenants. As one landlords it: put emphasize exeulpato- cases Several at in this ry A somewhere. The clauses such the one issue tenant must live public private matters rather than meaningful tenant has no choices. He case terms, the rental indus- accept go primarily can this landlord or to another because life, McCutcheon, necessity of shel a basic in which to live." try provides place safe people.3 of ter, to thousands at 486 P.2d at 1097. 79 Wash.2d the exercise of due way promote best contract longer an isolated is no A lease hold landlords liable care is to residential and one tenant. one landlord between Permitting land for their own so industry rental of the The size great potential ofan lords to insulate themselves that construction maintaining com liability negligently of on thousands impact has an only encourage those mon areas serves Furthermore, has public the citizens. irresponsible, who are however landlords housing quality of in the an interest be, they may not to take reasonable few all members of the rent to offered for can steps properties. to maintain their exeulpatory Enforcement of public. in to sanction hardly anyone's be interest injury cases results personal clauses in easily can poor maintenance that cause thus public, harm to the great dangerous common areas. conditions fall within the ex- clauses do not these only at on people Tenants are not the risk party may the rule that a ception to Any poorly premises. maintained member negli- against his or her own contract public premises enter the gence. injured as a result of a landlord's failure (Faulkner, at 765 J. Taylor, So.2d an to exercise due care. The has concurring specially). inju protecting interest in itself from such reasoning agree with the We ry. out that an point We also these cases. mind, thoughts these we con type of this contravenes With exculpatory clause by our law rules of clude that the five factors outlined long the established common Indiana, weigh in favor of not en supreme At common law liability. tort forcing type of clause in residential of reasonable care the landlord has (M) main ways the and areas are common na leases. Those factors include: the contract; subject reasonably fit and safe condi ture matter tained in a (H) strength under policy B. tion. Zawistoski Gene Glick (iii) statute; likelihood that lying Exeul- (Ind.Ct.App.2000). or term will bargain inconsistent with this refusal to enforce patory clauses are (iv) Exeulpatory policy; tort law. clauses further how serious principle would be the forfeiture suffered landlords from deserved discourage party attempting law to enforce the meeting duty imposed on them society. Taylor, (v) protection for the See bargain; parties relative bar gaining power and freedom to contract. (Faulkner, concurring 412 So.2d at 765 J. imposes liability Trotter, Tort law specially). 1152-53. Given food, people number of clauses like these products, unsafe unsafe and unsafe vast affect, inequality bargaining power "It makes little sense for us to premises. - insist, hand, fact housing, that a the need for on the one workman work, but, are not to the place people in which to on that who have safe hand, him could a result of deny reasonably contracts suffer as such other figure only Bureau, refers to the rental units and not According U.S. Census 667,000 occupants, the number of housing to the number Indiana rental units in had likely actually units people who live in such 2000. U.S. Census summarized http://www.ibre.indiana.ed _ u/population/cen- far exceeds number. 7-analysis.pdf. Because this sus2000/c2k051 clauses, respon to promote NAJAM, and the desire Judge, dissenting. landlords to avoid maintenance sible respectfully The majority .I dissent. par and third injuries by tenants personal opinion private nullifies a agreement, valid in ties, weigh factors favor we find that the lease, rewrites the and reallocates the ex- foregoing, the policy. Based on public change of costs and benefits between the exculpatory conclude that the clause

we majority parties. The declares that contrary public residential lease is to exculpatory question is void and as it seeks to immunize policy insofar long because it unenforceable "contravenes damages caused her Ransburg against established common law rules of tort liabil- maintaining negligence, any, if common ity" public and "offends the of the policy Therefore, not enti Ransburg was areas.4 In making state." this new rule the ma- law, and judgment to as a matter of tled prove, assumes what it seeks to jority trial denied her sum properly court namely, that the law of and the mary judgment motion. mutually law of contract occupy exclusive Conclusion spheres and cannot be on these reconciled type of the exculpatory clause here An facts, body notwithstanding Indiana long com- involved contravenes established contrary. majority ignores law to the liability of tort that exist in mon law rules plain meaning exculpatory of the relation- the residential landlord-tenant clause and violates the well-settled com- public it offends the ship. employed, As so right parties mon law to make such and will not be enforced policy state provision and to have it enforced accord- trial by the courts. The err did to ing doing, majority its terms. so summary judgment in denying Ransburg's unilaterally has altered the equa- economic motion. tion countless residential leases across the state. Affirmed. recognize Indiana courts the principle

DARDEN, J., concurs. are free to enter into contracts NAJAM, J., with separate and, indeed, dissents| presume repre contracts freely bargained agreement opinion. sent may bring cause of action tenants to enforce 4. The dissent to House Bill which refers - July becomes effective The dissent obligations, permitting alia landlords' inter points language relating damages to to recovery consequential dam- of actual personal injuries, which was removed Thus, despite ages. dissent's mischarac- Judiciary posits Senate Committee and it, specifically pre- the statute terization of enacted, would have modi- "if using exculpatory cludes landlords and, operation law fied common in its here con- clauses such as the one issue effect, prohibited have would liability damages away their tract clauses in residential leases." by failing satisfy duty their to maintain today Our decision is consistent with the permits pro- common areas and tenants imposes new statute as enacted. The statute duty. ceed landlords who fail in that landlords, including duties on various despite This the case the removal of remains duty keep to make "all reasonable efforts to language cited the dissent. The new premises common areas of a rental in' clean policy statute is consistent with the proper Law condition." Public No. 92- today, underlying reject and we our decision (to as Indiana Code Section codified way "usurp- we the notion that some 32-31-8-5(3)). provides The statute further ing" legislature by promoting the role of the Subject that a waiver of this is void. policy. sound prerequisites, certain the statute creates A404 contains, following exculpatory in part, Fazli, Cut, v. 650 Inc. Fresh

parties. (Ind.1995). 1126, language: 1129 Where N.E.2d unambiguous, an instrument language of lots, [Wlalkways, stairways, parking is determined parties intent of equipment all areas and lawns and other Orme v. Estate corners." from its "four occupants in all used common be 355, Kruwell, (Ind.Ct.App. 356 453 N.E.2d building grounds, apartment of the Co., 1983); v. Gene B. Glick Zawistoski see gratuitous- and maintained provided are 790, (Ind.Ct.App. Inc, 792 727 N.E.2d [Ransburg], [Ransburg] and ... ly by lease). 2000) The (interpreting shall, event, be or become lable no of a contract is legal or effect construction loss, any damage, per- or thereby by the of law to be determined question though .:. such property or even son court. by the damage shall be caused loss that Indiana is well established [Ransburg], agents, or its negligence of agree advance permitted employees. servants obligation of care for under no that one is added). App. (emphases at 78 Appellant's other, and shall not be the benefit exactly correspond The facts this case of conduct that consequences liable for the contemplated by with the cireumstances negligent. Powell v. would otherwise clause. Richards contends exculpatory Fitness Ctr. Fort

American Health clearing Ransburg negligent that (Ind.Ct. Inc., 757, 694 N.E.2d 760 Wayne, But the parking lot of snow and ice. Further, it is well settled in App.1998). clearly that Richards will prévides lease containing exceulpa- contracts Indiana that area at her own risk and use the common against public are not tory agreements Ha- Ransburg shall not be or become Dixon, 998, v. policy. Marsh acts, negligent including ble for her own (Ind.Ct.App.1999); see Weaver 1000 parking maintenance of the lot where Co., 458, 257 Ind. 276 American Oil slipped Richards and fell. (Ind.1971). 144, Parties to a N.E.2d 148 exculpate one of them may agree lease majority acknowledges this state's Loper See from his own enforceability "strong presumption 84, Ind.App. 138 211 Standard Oil represent freely bar- contracts (1965) (upholding commer N.E.2d gained agreement parties," cial that indemnified land generally en- "exculpatory clauses are negligence); lord its own see also public policy are not void on forced and Co., 701 N.E.2d Mgmt. Vertucci v. NHP majority But the then dis- grounds...." (Ind.Ct.App.1998) (concerning 606-07 principles declares instead cards these clause).5 exculpatory residential lease of whether a residential question that the lease, Here, which insulates the landlord from his parties agree they en- both negligence, contract that is unconscionable and tered into a residential lease own terms; Noll, upon equal Co. v. Ind. two stand neither In Franklin Fire Ins. (1945), form of one nor the other is under App. recognized propriety compulsion stipulations; to make the either as follows: entry clauses in leases may equally accept well or refuse into relationship tenant. tenant, of landlord and Stipulations between a landlord and public policy We think it clear that does not determining arising which shall bear a loss immunity voluntarily misrepair nonrepair condemn tene- ment, immune, upon by parties. agreed these and which shall be are not Moreover, omitted). (Citation matters of concern. against public policy therefore void as "has and unaware of its terms. But the con specifically been addressed in tract never must be one that no person sensible delusion, By phrasing question Indiana." in this not under duress or distress manner, make, majority attempts to distin- would and one that no honest and. guish types person residential leases from other fair accept. would In Nylen we Id. exeulpatory leases or contracts in which held that a standardized residential lease provisions upheld. agreement have been signed by college three stu dents was not unconscionable. - We long There is no such distinction. has that contracts are not unenforcea stressed been the law Indiana that a lease is to ble simply party because one enjoys an any manner be construed the same as advantage over the other. Id. at 185. The Zawistoski, contract. 727 at other N.E.2d fact Nylen that the lease in contained principle applies 792. This to commercial terms favorable to the landlord did not Loper leases. See v. Standard Oil 138 render that lease unconscionable. Id. (1965). 84, 797, Ind.App. 211 N.E.2d 800 Darden, court, And our Judge writing for Here, neither does the fact that recently principle reaffirmed that this also exculpatory clause Ransburg benefits applies Smyr residential leases. See more than Richards render that 534 unenforceable. majority points Marshall, 532, no 744 niotis N.E.2d signed evidence Richards the lease (Ind.Ct.App.2001) (citing Stout v. Kokomo 1060, Apartments, compulsion Manor 677 N.E.2d 1064 under majority or duress. The also fails to why demonstrate (Ind.Ct.App.1997)). lessees, Richards, such as are so disadvan Further, the issue of whether residential taged they special deserve "immuni

apartment leases are adhesion contracts ty" exculpatory protection clauses-a and, therefore, and unconscionable void upon has never bestowed a par against public policy already has been de ticular class of lessees.6 by Nylen cided this court. In v. Park Apartments, 178, Doral N.E.2d 184 Richards entered this agreement after having paralegal. denied, been trained as a (Ind.Ct.App.1989), trans. we ac knowledged supreme our opinion year-to-year court's She renewed her May lease in Weaver, that a contract January be declared and she fell in 1997. Rich- to unconscionability unenforeeable due ards had an opportunity to terminate or terms, there a great disparity bargain renegotiate when the lease but she re- ing power lease, which party leads the with the newed the Ransburg even after had power sign unwillingly lesser a contract informed monthly her rent would upheld exculpatory 6. court has This clauses in and that the victim was under no "public policy" otherwise, contracts where the concerns compulsion, economic to be in pit the restricted area. compelling present- far more than those were ed the lease here. In v. Lake Co. Likewise, LaFrenz Springs Corp., in Marshall v. Blue Bd., Ind.App. Fair 360 N.E.2d (Ind.Ct.App.1994), re- we (1977), patron we addressed whether to declare fused unconscionable a "liability derby, signed killed at a demolition who had signed by diving release" a scuba student exculpatory agreement an in order to receive prior taking subsequently who was lessons "pit pass" so that she could assist her hus- injured. holding, In so we noted that Mar- mechanic, bargained away band as a had her shall to take chose the scuba lessons for his right upholding to sue the Fair Board. enjoyment compulsion own no under clause, exculpatory we concluded that there outside source to the les- undertake unequal bargaining power was no between sons. Id. Marsh, 707 N.E.2d at negligence. See per more than $100 be increased suggest a facts neither These month. bargaining power nor

great disparity Here, unambigu- unwilling unaware that Richards was ously Ransburg will not be states the contract signed she of its terms when damages "caused liable for those losses Nylen, 585 two occasions. least [Ransburg], or its at 184. lan- employees." This agents, servants parties knowing guage demonstrates majority attempts distinguish to The willing commitment to release Rans- and There, we consid case from Vertucei. damages resulting burg liability from for exeulpatory of an clause ered the effect her own See Clanton from the tenant had lease where a residential America, N.E.2d Skates 686 United Ver victim of sexual assault. been the ex- (Ind.Ct.App.1997) (upholding 901 tucci, By con N.E.2d 606-07. first to plaintiff agreed clause where culpatory clause sidering exculpatory whether lability any in- release defendant from outcome, acknowledged we controlled pres- of or jury which arose from his "use against public are not provisions that such ... upon the whether [flacilities ence Otherwise, we would have had no policy. fault negligence not caused or other exeulpa- whether the reason to determine [defendant]"). majority opinion The applied to shield the landlord tory clause clause, ignores agreement nullifies the majority liability. attempts from The but and, by declaring the clause parties, opinion its with Vertueci. fails to reconcile public policy, re-writes against void as Indiana law. I hold that the exculpatory While would Freedom of contract is a common law public policy, not violate

clause here does right. legislature Our has declared does not end the ultimate conclusion governs this state when the common law Notwithstanding parties' enquiry. - it is not inconsistent with our constitutions Ransburg to insulate from clear intention § 1-1-2-1. and statutes. See Ind.Code language negligence, its own supreme our court stated in Johnson As exculpatory provision legally must be suffi Assoc., Inc., v. Scandia 717 N.E.2d accomplish goal. to This court cient (Ind.1999), private, contracts are volun exeulpatory has held that an clause will not tary by which two or more allocations drafting party from lia act to absolve specific entitlements and parties distribute bility "specifically explicitly unless it and obligations. When a landlord enters negligence party refers] lease, voluntarily she confers Marsh, liability." from seeking release rights upon certain the tenant consider (citation omitted). at 1000 rent, promise pay ation of the tenant's to that an principle This rule is based on the illegal it for property, not waste the use party to release a from its own agreement beyond or "holdover" the term. purposes, negligence clearly unequivocally must and agrees legal Id. The landlord to this rela knowing willing manifest a commit costs and ben tionship balancing after party pay damages one ment efits, and the same is true for the tenant. negligence of the other occasioned Id. An party. does right not refer to the of a releasee is have the parties The obligations. it purports rights void to the extent to release define their mutual Bank party liability Jennings Realty Corp. its own v. First Nat'l Vernon, (Ind. introduced a that would have North App.1985). prov Ct. is not within our created a tenant's cause of action ince to make a new for the landlord for "any contract damages for personal or to ignore any provisions eliminate in injuries," and would have made at the instrument. majority opinion Id. The tempt to action, waive such an by contract rights violates the associated freely with otherwise, enacted, void. If the provi bargained for rights contracts and the inci sion would have modified the common law property dent to real ownership. Rans- and, in operation effect, its would have burg's right, owner, a property to con prohibited exculpatory clauses in residen trol the use of her private property an Now, tial leases. the majority opinion has essential feature of system. our economic invoked "public policy" to accomplish by rights associated ownership with judicial decree precisely what the General property right include the possess, en Assemblyhas declinedto do.7 sell, joy, destroy, or otherwise control the Henry property. use See N. Bur supreme Our supports the tradi Analysis ler, Lawyers, Economic ror p. 357 precaution tional against the reckless use (1998). economies, In free market policy aas means invalidating rights enforced, of ownership typically contracts emphasized and has ° thwarted, not government. power of the courts to declare a contract Finally, the majority usurps the role of void being in contravention of sound legislature when it invokes "public poli- public policy very is a delicate and unde ey" justify opinion. its The flaw the Bell, fined power. Hogston v. 185 Ind. majority's "public reliance on policy" is 536, 883, (1916); 112 N.E. Straub v. underscored legislation. recent The Todd, B.M.T. by 599 n. 3 2002 session of the Indiana General As- (Ind.1994). Our courts should not invoke sembly enacted a bill that regulates resi- "public policy" to nullify an otherwise valid leases, dential Bill House which be- private agreement, exeept resort, aas last comes effective July 2002. The new and then only where legal justification legislation was enacted some twenty-six clear, is compelling and unavoidable. We years after legislation landlord-tenant private tinker with great peril. contracts at first introduced Assembly General doing jeopardize so we the freedom our and is the best evidence of the enjoy citizens agreements by make policy of our state on this It issue. is which significant they voluntarily that the Senate Committee allocate their re on Judiciary deleted from House Bill 1013 as spective rights, responsibilities. risks and majority point The contends that this a legislature is fact that our considered and rejected '"mischaracterization'' of the statute. provision The a given that would have majority opinion also asserts that right its is "con- "personal tenants a inju- to recover for enacted," statutory remedy undoubtedly ries" sistent with the statute as in that imposes statute landlord to contemplated negligence cause of action. "make all keep reasonable efforts common just important recognize what a stat- premises areas of a rental in a clean and say recognize ute does as it tois what it condition," proper Zirkelbach, say. City which cannot be waived. does Evansville v. Id.; Public Law majority No. 92-2002. The 654 (Ind.Ct.App.1996), trans. de- language "specifically pre- legislative insists history nied. The is clear. Had cludes" disclaiming landlords from legislature prohibit their own wanted to landlords majority But the disclaiming errs when it from negligence, their own it equates "all reasonable efforts" with "all non- would have included such a in the negligent majority ignores efforts." And the statute. -Itdid not. lawfully clause here lability against Ransburg

shields re- We should claim.

Richards' summary denial court's the trial

verse judg- summary and order

judgment Ransburg. in favor of be entered

ment reasons, dissent. respectfully I these

For TRUCKING, also

QUIGG sometimes Trucking, Quigg Charles

known as

Appellant-Defendant, Autumn Bell A. NAGY

Christian Appellees-Plaintiffs.

Nagy,

No.79A05-0110-CV-465. Indiana. Appeals

Court 20, 2002.

June notes short, to exist. such dard ceases concept negli- destroys clause recently, Supreme More the Tennessee relation- gence the landlord-tenant in a tenant's residen Court held

Case Details

Case Name: Ransburg v. Richards

Court Name: Indiana Court of Appeals

Date Published: Jun 20, 2002

Citation: 770 N.E.2d 393

Docket Number: 29A05-0101-CV-25

Court Abbreviation: Ind. Ct. App.