Diamond Crystal Salt Company and Liberty Mutual Insurance Company, Appellants, v. Grace Verret Thielman, Appellee, 395 F.2d 62 (5th Cir. 1968)

Robert J. Vandaworker, of Taylor, Porter, Brooks, Fuller & Phillips, Baton Rouge, La., for defendants-appellants.

Anthony J. Clesi, Jr., of Gordon & Clesi, Baton Rouge, La., for plaintiff-appellee.

Before COLEMAN and CLAYTON, Circuit Judges, and JOHNSON, District Judge.

JOHNSON, District Judge:

Diamond Crystal Salt Company and its liability insurer, Liberty Mutual Insurance Company, appeal from a judgment entered on a jury verdict in favor of Mrs. Grace Verret Thielman. Mrs. Thielman's action was for the recovery of damages for her own personal injuries and for the wrongful death of her husband, which occurred while she and her husband were on a guided tour of the underground mine of the appellant Diamond Crystal Salt Company near New Iberia, Louisiana.

The appellant Diamond Crystal Salt Company required the Thielmans, who were nonpaying visitors, to execute separate releases¹  before taking the tour on March 9, 1964. During the trial of the case when the "release defense" was first presented, the District Court, on its own motion, instructed the jury that "it is against the public policy of the State of Louisiana for a person to be permitted to release someone in advance for any acts of negligence which they might later be guilty of." The sole question²  presented on this appeal is the correctness of that ruling.

Salt mines are tourist attractions in Louisiana. On the date of the accident, Mr. and Mrs. Thielman, neither of whom had any connection with the Diamond Crystal Salt Company, were on vacation in the vicinity of the mine in question. They arrived prior to the advertised time of a scheduled tour and separate releases were executed for both Mr. and Mrs. Thielman. After the tour began, and while Mr. and Mrs. Thielman were in a portion of the mine which the salt company authorized them to enter in the company of a tour guide, a portion of the roof at the 1,000-foot level of the mine caved in killing Mr. Thielman instantly and seriously injuring Mrs. Thielman.

The accident occurred in a room with a 90-foot ceiling through the collapse of a "fault" in the salt. The appellant Diamond Crystal Salt Company had known of the existence of the "fault" for some time prior to the accident, knew that it was dangerous, and could have prevented the collapse. The "fault" was not, however, visible to anyone standing on the floor of the mine, and, had it been observed, its dangerous nature would not have been obvious to a person not experienced in such an operation.

Louisiana organic law allows an individual to contract concerning liability for negligence in all cases where such a contract is not contrary to public policy.³  Celestin v. Employers Mutual Liability Insurance Co. of Wisconsin, 387 F.2d 539 (5th Cir. 1968). Only three Louisiana cases appear material to the public policy question here presented.⁴  The broad principle of Louisiana law involved is stated in Sandel & Lastrapes v. City of Shreveport, 129 So. 2d 620, 624 (La.App., 2d Cir., 1961):

"It is contrary to public policy to allow a contractee to stipulate exemption from negligent acts which cause injury."

That case, however, dealt with a construction contract rather than with an exemption from liability for personal injuries.⁵ 

The only Louisiana case dealing with an exemption from liability for personal injuries is Forsyth v. Jefferson Downs, Inc., 152 So. 2d 369, 375 (La.App., 4th Cir. 1962), writ refused 244 La. 895, 154 So. 2d 767 (1963):

"The validity of the agreement, per se, is not an issue here and it will serve no purpose to discuss it, however, under LSA-C.C. Art. 11 it is not in contravention of public policy for a party to assume the risk of injuring himself or his property in consideration for his being allowed to use the premises of a race track."

In that case, a race track was undergoing repairs during the off season and horsemen who regularly kept their animals stabled on the premises were forbidden to use the track. As a condition to being allowed to use the track for training purposes, the plaintiff was one of ten horsemen who entered into a written agreement providing that "our horses are exercising or training on the race track at our own risk and that any injury to the exercise boy, jockey, or trainer or any injury to the horses will be at our own risk * * *." A horse was fatally injured when it swerved into an area where the interior rail had been removed as a result of the construction work. This danger was obvious and known to all parties to the agreement.

The third case in which Louisiana public policy has been considered is Celestin v. Employers Mutual Life Insurance Company of Wisconsin, supra. That case dealt with "an exculpatory clause in the lease of a movable." Celestin had rented an extension ladder and was injured when it collapsed. The "rental agreement" which he signed provided that "the lessee agrees to use said equipment entirely at his own risk" and further provided that the lessee would indemnify the lessor for any liability occasioned by the use of the property. Leases are subject to special statutory treatment in Louisiana.⁶  After considering the effect of the statutes applicable to leases, the Court concluded that nothing in the statute law or public policy of the State of Louisiana forbade the waiver in that case and that a jury question was presented as to whether the waiver was a part of the agreed contract.

Thus, the only two Louisiana cases dealing with the question now presented and involving personal injuries have upheld exculpatory provisions dealing with assumption of the risk. However, these two cases concerned factual situations where either the dangerous condition was both obvious and known to both parties or where the instrumentality causing harm was in the exclusive possession and control of the person injured. In such a state of authorities, the opinion of the trial judge must be accorded great weight.⁷ 

It is clear that Louisiana public policy disfavors similar agreements involving indemnity to the extent of requiring that they be strictly construed,⁸  and an agreement purporting to prospectively relieve another of liability for an intentional tort is void even though it may not involve corporal injury. Hayes v. Hayes, 8 La.Ann. 468 (1852). Appellants seek to compare the "release" here involved to a contract of liability insurance. There is obviously no comparison. The law allows one to purchase liability insurance as a matter of sound public policy. Such insurance is a contract of indemnity whereby a person may be indemnified for liability arising from his own negligence. The first and most obvious distinction is that such contracts involve the legal relations of three persons rather than just two. The significant distinction, however, is that such contracts attempt to guarantee that the person injured as a proximate result of the negligence of the insured will be compensated for such injuries, whereas enforcement of the contract in the instant case would have just the opposite result of denying an injured person the right to be compensated for injuries proximately caused by another's negligence.

There is clearly a distinction between holding that public policy forbids a contract whereby an attempt is made to prospectively absolve one of liability for injuries negligently caused through instrumentalities in his exclusive control and holding that public policy allows a contract whereby one agrees to assume the risk of injuring himself when he is apprised of the nature of a dangerous condition and voluntarily continues to act. It is fundamental that in order to assume a risk, the dangerous condition must be one which is obvious to a person exercising ordinary care for his own safety.⁹  The risk and danger must be seen, understood, and appreciated before a risk may be legally assumed.¹⁰  In this case, the danger was not obvious, and if the dangerous condition had in fact been observed it would not have been appreciated by persons of ordinary understanding. No warning was given concerning the existence of the "fault."¹¹ 

Mr. and Mrs. Thielman had no knowledge of the existence of the "fault" in the ceiling of the salt mine, and, even had it been obvious, the danger could not have been understood so as to result in an assumption of the risk. The cause of the injury in this case was within the exclusive control of the mine operators and only they had knowledge of the danger. These circumstances clearly distinguish this case from Celestin and Forsyth, supra, so as to bring it squarely within the general rule of Sandel & Lastrapes.

Affirmed.