Release Clauses: Everything You Need to Know
A release clause is a legal agreement between two parties in which the rights to potentially file a lawsuit are being relinquished by one or both parties.3 min read
2. Express Waiver vs. Implied Waiver
3. When a Release Clause May Be Nullified
A release clause is a legal agreement between two parties in which the rights to potentially file a lawsuit are being relinquished by one or both parties. If you have been laid-off or otherwise had your employment terminated, you may have signed a release clause. Sometimes a release may be presented as it’s own contract; other times it may be included as a part of a broader contract. Other situations under which a release clause may be used include:
- If you are engaging in a high-risk activity such as bungee jumping or base-jumping, you may be required to sign a release clause, ensuring that you will not sue the company in charge of the activity, should you become injured.
- In business relationships, release clauses may be utilized as a means of proposing other means, such as mediation, to resolve any conflicts that may arise.
Additionally, if you belong to a gym or health club, you probably signed a release clause as part of your membership agreement, assuring management that if you become injured while working out, you will not take legal action. Occasionally, spa facilities may also require the signing of a release clause to ensure you don’t sue, should you pass out in the sauna or steam room. In both cases, what the release clause is essentially dictating is that you are responsible for knowing your health and physical capabilities, and are therefore responsible for your own injures or health issues that may arise.
What to Keep in Mind
As signing a release contract can greatly hinder the ability to seek compensation or otherwise collect losses, it is important that you be fully aware of the parameters regarding a release clause prior to signing. Additionally, as a release clause is a legal document, it must adhere to the same guidelines of any contract. There are circumstances under which it could be nullified, so it is equally valuable for the party drafting the contract to be certain it is being done correctly. As such, prior to either signing or drafting a release clause, it is advisable to seek the services of a reputable attorney.
As with any legal contract, certain components must be included in a release clause, including:
- Confirmation that all parties are mentally and emotionally capable of entering into a legal agreement.
- Confirmation that all parties are of the legal age required (in the United States, 18 years old) to be entering into a legal agreement.
- Verification that any activities occurring within the scope of the contract are not illegal.
- Clear, concise language that is not open to interpretation.
Express Waiver vs. Implied Waiver
When signing a release clause, it is considered an express waiver. However, implied waivers are important to keep in mind, as well. Unlike an express waiver, an implied waiver is generally not a physical document. Often understood in the realm of physical activity that could cause injury, an implied waiver assumes that the individual knows fully well that they could hurt themselves and if they do, it’s their responsibility. For example, if you go skiing, you probably do not have to sign a release clause when purchasing your lift ticket; rather, the unspoken (or, undocumented) understanding is that you know you may injure yourself and that you are not going to sue the resort if you break your leg.
When a Release Clause May Be Nullified
As previously mentioned, there are certain circumstances when a release clause may be nullified. Some examples include:
- The signing party being coerced into entering into the agreement. For example, sometimes an employer, upon terminating employment may attempt to refuse release of remaining paychecks until the release clause is signed.
- If the injury is not directly related to the parameters of the release clause. For example, it may be understood that you could fall and hurt yourself while skiing, but if you are injured because a tree falls on you, then you may be able to take legal action against the ski resort.
- If the language used in the release clause is unclear, or otherwise open to interpretation, it may make it difficult for the contract to be enforceable.
- Any mistakes made regarding the execution of the release clause. For example, if the signing party was not aware of what they were signing, then a court may question the validity of the contract.
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