Contracts by which one seeks to relieve himself from the consequences of his own negligence are generally enforced unless (1) it would be against the settled public policy of the state to do so, or (2) there is something in the social relationship of the parties militating against upholding in the agreement.
After the tenant was injured when she fell on allegedly defective pavement in the courtyard of her apartment building, the tenant brought an action against the landlord for negligence in maintaining and operating the apartment building. The trial court entered judgment on a jury verdict in favor of the tenant, and the landlord sought review. The appellate court reversed the judgment on the grounds that the action was barred by an exculpatory clause in the tenant's lease with the landlord, and the tenant sought review.
Is the exculpatory clause enforceable?
The court held that neither public policy nor the social relationship of the parties forbade enforcement of the exculpatory clause in the tenant's rental agreement. The court held that a contract shifting the risk of liability for negligence provided a potential benefit to a tenant as well as a landlord. The court held that a shortage in housing did not necessarily produce a disparity of bargaining power between lessors and lessees, and that even if it did, it was a subject appropriate for legislative, rather than judicial, action.