BJ's Wholesale Club, Inc. v. Rosen

BATTAGLIA, J. This case requires us to consider the enforceability of a clause, which contained both an exculpatory provision and indemnification language, in an agreement executed by a parent on behalf of his minor son permitting his son’s use of a free supervised play area called the “Incredible Kids’ Club” (Kids’ Club) offered by BJ’s Wholesale Club, Inc. (BJ’s), a commercial wholesale retail center at its location in Owings Mills, Maryland. The Kids’ Club contained a number of different amusement items, including, for instance, a plastic apparatus called “Harry the Hippo” for children to use while their parents shopped. To use the Kids’ Club, BJ’s requires parents to sign an agreement, entitled “BJ’s Incredible Eads’ Club Rules” mandating usage restrictions 1 and, more pertinent to this matter, also contains an exculpatory clause that provides that: I hereby acknowledge that the participation in BJ’s Incredible Eads Club (the “Play Center”) is a benefit offered to me ⁷¹⁷ as a part of my BJ’s Wholesale Club membership. I further acknowledge that I have read, understood and I voluntarily agree to abide by all of the rules appearing above and/or rules as posted in the Play Center and registration area.

In consideration for this service, I, individually and on behalf of my child, do hereby waive, release and forever discharge BJ’s Wholesale Club, Inc.; its subsidiaries and affiliates and their respective agents, employees, officers, directors, shareholders, successors and assigns from any and all claims and causes of action of any kind or nature which are in any way related, directly or indirectly, to the use of Play Center which I may have or that hereafter may accrue including any such claims or causes of action caused in whole or in part by the negligence of BJ’s Wholesale Club, Inc., its subsidiaries and affiliates, and their respective agents, employees, officers, directors, successors and assigns. I understand that my child is here at my own risk and expense and agree that neither I nor my child will bring any claim or cause of action of any kind or nature against BJ’s Wholesale Club, Inc., its subsidiaries and affiliates and their respective agents, employees, officers, directors, successors and assigns. Immediately below in the same paragraph is found an indemnification clause: I further agree to indemnify, defend and hold harmless BJ’s Wholesale Club, Inc., its subsidiaries and affiliates and their respective agents, employees, officers, directors, successors and assigns from any claims or causes of action of any kind arising from my or my child’s use of the Play Center. By placing my signature below, I acknowledge and agree that I have read this agreement, understood all of the terms and conditions contained herein, and that this agreement will be in full force and effect during each of my or my child’s visit to the Play Center.

This agreement shall remain in full force and effect at all times whether my child is dropped off at the Play Center by me or any one else. ⁷¹⁸ This language appears in smaller font than the remaining agreement, but is printed in bold letters just above the line for the parent or guardian’s signature. 2 On July 17, 2005, Russell Rosen executed the “BJ’s Incredible Eads’ Club Rules,” inclusive of both the exculpation and indemnification clauses, on behalf of his three minor children, including his son, Ephraim Rosen. Approximately fifteen months later, Beily Rosen, his wife, went shopping at the BJ’s’ Owings Mills location and dropped off then five-year old Ephraim at the Kids’ Club where, according to the Rosens’ Complaint filed in the Circuit Court for Baltimore County, Ephraim was injured: 7. [T]he play area was under the control and supervision of BJ’s and its agents and employees, and BJ’s had actual or apparent control of the play area. 8. The play area consisted of a number of different amusement items for children. The entire play area is covered by carpet.

In most of the play area, the carpet covers a thick layer of resilient foam padding. In other areas, the carpet was adhered directly to a concrete floor. There were no markings to delineate where the floor was padded and where it was not. 9. On October 22, 2006, Beily Rosen went shopping at BJ’s with Ephraim.

She left Ephraim in the play area. 10. While in the play area, Ephraim was playing on an elevated plastic play apparatus known as Harry the Hippo. 11. The Hippo was approximately 38" high at its peak and varied in height along the rest of the structure. 12. The Hippo was placed in such a manner that a child who fell forward would land directly on top of the concrete floor covered by only a thin layer of carpet. ⁷¹⁹ 13.

Ephraim fell off the front of the structure landing head first directly on the concrete floor covered only by a thin layer of carpet. 14. Ephraim was crying profusely after the fall. His mother was notified to retrieve Ephraim from the play area. 15. That day Ephraim was taken to Sinai Hospital in Baltimore, Maryland.

A CT scan of his head revealed that Ephraim had suffered a large acute epidural hematoma in the right temporal, and parietal convexity with extensive mass effect.[ 3 ] 16. Ephraim was transferred to Johns Hopkins in Baltimore, Maryland. There he underwent an emergent, right frontal temporal parietal craniectomy for evacuation of the epidural hematoma.[ 4 ] The surgery saved Ephraim’s life. The Complaint plead a cause of action in negligence, asserting that: 17.

BJ’s had a duty to exercise reasonable care to protect its patrons in the play area from injury. 18. BJ’s agents and employees knew or should have known that placing an elevated play structure directly over carpet adhered to a concrete floor would pose a danger to children playing there. 19. BJ’s breached its duty of care by placing The Hippo in an area without sufficient padding. BJ’s filed an Answer containing a general denial; after the parties began discovery, BJ’s filed a counterclaim against the ⁷²⁰ Rosens, alleging breach of contract for failing to indemnify, defend, and hold BJ’s harmless pursuant to the indemnification clause.

Thereafter, BJ’s filed a motion for summary judgment under Rule 2-501 5 alleging that no factual matters were in dispute and that, pursuant to our decision in Wolf v. Ford, 335 Md. 525 , 644 A.2d 522 (1994), the exculpatory clause was valid and barred the Rosens’ claims as a matter of law. 6 The Rosens filed an opposition, contending that, among other things, the exculpatory and indemnification clauses were unen ⁷²¹ forceable, because they violated Maryland’s public policy interest of protecting children. After holding a hearing, Judge Thomas J. Bollinger, Sr., of the Circuit Court for Baltimore County granted summary judgment for BJ’s: The issue before the Court is one of first impression in Maryland. The question is the enforceability of an exculpatory clause signed by one or more of the parents on behalf of their minor child. The Plaintiffs argue that enforcement of such agreements should be void for being against public policy.

Since Maryland has yet to establish any alternative law for adults who sign exculpatory clauses for their children [the trial court] must use the general rule in determining the validity of [the] agreement. Generally, Maryland Courts will uphold exculpatory clauses that are executed by adults on their own behalf. Wolf v. Ford, 335 Md. 525, 535 [ 644 A.2d 522 ] (1994). “There are circumstances, however, under which the public interest will not permit an exculpatory clause in a contract[ ].” Id. at 531 [ 644 A.2d 522 ]. “Public policy will not permit exculpatory agreements in transactions affecting the public interest.” Id. at 532 [ 644 A.2d 522 ], “The ultimate determination of what constitutes the public interest must be made considering the totality of the circumstances of any given case against the backdrop of current societal expectations.” Id. at 535 [ 644 A.2d 522 ]. While this Court recognizes that the Maryland Court of Appeals has intended to create a public interest exception, without further guidance, this Court is not capable of evaluating “the totality of the circumstances” against a “backdrop of current societal expectations.” Id.

Consequently, this Court lacks any ability to pronounce public policy grounds to invalidate the clause that Mr. Rosen signed on behalf of his minor child. (alteration in original). 7 The Rosens filed a timely notice of ⁷²² appeal in the Court of Special Appeals, and in a reported opinion, the Court of Special Appeals reversed. Rosen v. BJ’s Wholesale Club, Inc., 206 Md.App. 708, 716 , 51 A.3d 100 (2012). In so doing, the Court of Special Appeals struck down the exculpation and indemnification clauses, acknowledging that while our decision in Wolf validated exculpatory clauses, “[t]here are circumstances ... under which the public interest will not permit an exculpatory clause in a contract!)]” Id. at 716, 51 A.3d at 105 , quoting Wolf, 335 Md. at 531 , 644 A.2d 522 (alterations in original).

Our intermediate appellate court explored authority from our sister states such as that from New Jersey, Hojnowski v. Vans Skate Park, 187 N.J. 323 , 901 A.2d 381 (2006), and Florida, Kirton v. Fields, 997 So.2d 349 (Fla.2008), to bolster its conclusion that an agreement entered into by a parent barring a future negligence claim asserted by a child against a commercial enterprise is unenforceable. Rosen, 206 Md.App. at 719-22 , 51 A.3d at 107-10 . The court further opined that the State has a “parens patrie interest in caring for those, such as minors, who cannot care for themselves [that] tilts the scales in favor of invalidating a parent’s agreement to release his or her child’s future tort claims against ‘commercial enterprise[s],’ ” id. at 727 , 51 A.3d at 112 , quoting In re Najasha B., 409 Md. 20, 33 , 972 A.2d 845 (2009), which “ ‘derive economic benefit from’ the provision of their services, [so that] ‘they are better able to bear the costs associated with injuries than the children or their families,’ as they can ‘spread the costs of insurance among [their] customers.’ ” Id. at 728, 51 A.3d at 112 , quoting Hojnowski, 901 A.2d at 388 . BJ’s petitioned this Court for a writ of certiorari, which we granted, to consider: 1.

In limiting its analysis and holding to “commercial enterprises,” did the Court of Special Appeals incorrectly create a distinction not previously recognized in determining the validity of exculpatory agreements in Maryland? ⁷²³ 2. Did the Court of Special Appeals err in both disregarding and misinterpreting Maryland public policy in adopting what it described as the “majority view”? 3. Did the Court of Special Appeals err in applying the same flawed public policy rationale in holding the indemnification clause invalid?[ 8 ] BJ’s Wholesale Club v. Rosen, 429 Md. 528 , 56 A.3d 1241 (2012). All of these questions essentially ask us to review the trial court’s decision de novo, as only matters of law present themselves.

See, e.g., Uninsured Employers’ Fund v. Danner, 388 Md. 649, 658 , 882 A.2d 271, 277 (2005); Johnson v. Mayor & City Council of Baltimore City, 387 Md. 1, 6 , 874 A.2d 439, 442 (2005). These questions, moreover, require us to consider the contours of our decision in Wolf , which held that an exculpatory agreement will be permitted except in certain circumstances, including “in transactions affecting the public interest.” Wolf, 335 Md. at 531-32 , 644 A.2d at 525-26 . Initially, BJ’s argues that we should refrain from opining on the enforcement of an exculpatory clause against a minor child in the absence of any legislation prohibiting such clauses, arguing that “declaration of public policy [is] best left to the Legislature.” For this proposition, BJ’s counsel relied at oral argument on our recent decision in Warr v. JMGM Group, LLC, 433 Md. 170 , 70 A.3d 347 (2013), in which we declined to adopt dram shop liability. 9 That case, however, is inapposite; in Warr the Legislature had previously considered, and de ⁷²⁴ dined to adopt on a number of occasions, the policy the Petitioners in Warr sought, while in the present case, as conceded by counsel at oral argument, the validity or lack thereof of exculpatory agreements executed by a parent on behalf of a minor child, has not been considered by the Legislature. An exculpatory clause is a “contractual provision relieving a party from liability resulting from a negligent or wrongful act.” Black’s Law Dictionary (9th ed.2009).

By entering into an exculpatory agreement, “the parties expressly ... agree in advance that the defendant is under no obligation of care for the benefit of the plaintiff, and shall not be liable for the consequences of conduct which would otherwise be negligent.” Wolf, 335 Md. at 531 , 644 A.2d at 525 , quoting W. Page Keeton, et al., Prosser and Keeton on the Law of Torts, § 68, at 482 (5th ed.1984) and citing Restatement (Second) of Contracts § 195 (1981). We have had occasion to address the validity of exculpatory clauses most recently in Wolf , 10 determining that “[i]n the absence of legislation to the contrary, exculpatory clauses are generally valid, and the public policy of freedom of contract is best served by enforcing the provisions of the clause.” Id. at 531 , 644 A.2d at 525 . We also have opined that exculpatory clauses are to be construed ⁷²⁵ strictly, requiring that the language of any such clause “clearly and specifically indicates the intent to release the defendant from liability for personal injury caused by the defendant’s negligence.” Adloo v. H.T. Brown Real Estate, Inc., 344 Md. 254, 266 , 686 A.2d 298, 304 (1996), quoting Barnes v. New Hampshire Karting Ass’n, 128 N.H. 102 , 509 A.2d 151, 154 (1986). In Wolf , after articulating the general acceptance of exculpatory clauses, we elucidated various exceptions to their validity.

Persuaded by the rigor of Winterstein v. Wilcom, 16 Md.App. 130 , 293 A.2d 821 (1972), we recognized that there were circumstances in which enforcement of an exculpatory clause could be precluded, the first two being: First, a party will not be permitted to excuse its liability for intentional harms or for the more extreme forms of negligence, i.e., reckless, wanton, or gross. Winterstein, 16 Md.App. at 136 , 293 A.2d at 824 ; Restatement, Second, Contracts § 195(1); Keeton, supra. Second, the contract cannot be the product of grossly unequal bargaining power. “When one party is at such an obvious disadvantage in bargaining power that the effect of the contract is to put him at the mercy of the other’s negligence, the agreement is void as against public policy.” Winterstein, 16 Md.App. at 135-36 , 293 A.2d at 824 ; Keeton, supra. Wolf, 335 Md. at 531 , 644 A.2d at 526 .

The third circumstance precluding enforceability was when a transaction affects the public interest: Third, public policy will not permit exculpatory agreements in transactions affecting the public interest. Winterstein, 16 Md.App. at 136 , 293 A.2d at 824 . This last category includes the performance of a public service obligation, e.g., public utilities, common carriers, innkeepers, and public warehousemen. It also includes those transactions, not readily susceptible to definition or broad categorization, that are so important to the public good that an exculpatory clause would be “patently offensive,” such that “ ‘the common sense of the entire community would ... pronounce it’ ⁷²⁶ invalid.” Md.-Nat’l Cap.

P. & P. v. Wash. Nat’l Arena, 282 Md. 588, 606 , 386 A.2d 1216, 1228 (1978), quoting Estate of Woods, Weeks & Co., 52 Md. 520, 536 (1879). Id. at 531-32 , 644 A.2d at 525-26 . “Transactions affecting public interest,” under Wolf encompasses three distinct categories, two of which are not relevant here, because they were not relied upon by Judge Bollinger in reaching his decision in this matter, those being: public service obligations, see, e.g., Collins v. Virginia Power & Elec. Co., 204 N.C. 320 , 168 S.E. 500, 504 (1933) (invalidating an exculpatory agreement between a customer and a telegraph company); Bowman & Bull Co. v. Postal Tel.-Cable Co., 290 Ill. 155 , 124 N.E. 851, 852 (1919) (invalidating an exculpatory clause between a customer and a telegraph-service provider); Reeder v. W. Gas & Power Co., 42 Wash.2d 542 , 256 P.2d 825 (1953) (invalidating an exculpatory clause between a customer and gas-service provider); and other transactions “so important to the public good that an exculpatory clause would be patently offensive.” Wolf, 335 Md. at 532 , 644 A.2d at 526 (citation and quotations omitted); e.g., Wartsila NSD N. Am., Inc. v. Hill Int’l, Inc., 530 F.3d 269 (3d Cir.2008) (applying Maryland law and holding that an exculpatory clause in an agreement between a construction consulting firm and an engineering firm was enforceable because construction consulting is not essential to the public good); Seigneur v. Nat’l Fitness Inst., Inc., 132 Md.App. 271, 284 , 752 A.2d 631, 637 (2000) (holding that an exculpatory agreement between a customer and a health club was enforceable because services provided by a health club are “not ... of great public importance nor of practical necessity”).

Judge Bollinger, rather, relied upon a final catch-all category of the public interest exception to the validity of exculpatory clause, which he recognized was not easily defined, opining that: “While ... the Maryland Court of Appeals has intended to create a public interest exception, without further guidance, [I am] not capable of evaluating ‘the totality of the circumstances’ against ‘a backdrop of current societal expectations.’ ” In Wolf , we attempted to define the contours of this category ⁷²⁷ of the public interest exception by dissecting Winterstein , in which the Court of Special Appeals had adopted a six-factor test established by the Supreme Court of California in the case of Tunkl v. Regents of University of California, 60 Cal.2d 92 , 32 Cal.Rptr. 33 , 383 P.2d 441, 444-46 (1963), which held that a transaction affects the public interest when: [T]he attempted but invalid exemption involves a transaction which exhibits some or all of the following characteristics. It concerns a business of a type generally thought suitable for public regulation. The party seeking exculpation is engaged in performing a service of great importance to the public, which is often a matter of practical necessity for some members of the public. The party holds himself out as willing to perform this service for any member of the public who seeks it, or at least for any member coming within certain established standards.

As a result of the essential nature of the service, in the economic setting of the transaction, the party invoking exculpation possesses a decisive advantage of bargaining strength against any member of the public who seeks his services. In exercising a superior bargaining power the party confronts the public with a standardized adhesion contract of exculpation, and makes no provision whereby a purchaser may pay additional reasonable fees and obtain protection against negligence. Finally, as a result of the transaction, the person or property of the purchaser is placed under the control of the seller, subject to the risk of carelessness by the seller or his agents. Id. 32 Cal.Rptr. 33 , 383 P.2d at 445-46 (footnotes omitted).

We declined, however, to adopt the Tunkl factors, determining that the “fluid nature of the public interest” renders strict reliance on “the presence or absence of six fixed factors” arbitrary and inappropriate. We recognized, instead, that while the factors may be persuasive to evaluate the public interest, “[t]he ultimate determination of what constitutes the public interest must be made considering the totality of the circumstances of any given case against the backdrop of ⁷²⁸ current societal expectations.” Wolf, 335 Md. at 535 , 644 A.2d at 527 . The concept of “societal expectations,” then, was undefined in Wolf , as Judge Bollinger noted, as he grappled with its application in this case. Our decision in declining to offer a precise definition, however, was based on our recognition that the “public interest” is an amorphous concept not easily defined.

Nevertheless, we agree with the parties and the Court of Special Appeals that, in discerning societal expectations, we should look to relevant statutory and common law. See Porterfield v. Mascari II, Inc., 374 Md. 402, 427 , 823 A.2d 590, 605 (2003); Maryland Nat. Bank v. Comptroller of Treasury, 264 Md. 536, 549 , 287 A.2d 291, 298 (1972). Section 5-203(b) of the Family Law Article, Maryland Code (1974, 2012 RepLVol.) defines globally the role of a parent, providing that “the parents of a minor child ... are ... responsible for the child’s support, care, nurture, welfare, and education[.]” Closely associated with these obligations and duties is our long-standing recognition that “parents are presumed to act in their children’s best interests,” Boswell v. Boswell, 352 Md. 204, 240 , 721 A.2d 662, 679 (1998), which is evinced throughout our cases, including those involving custody, visitation, and adoption disputes.

There are, thus, clear societal expectations set forth in the law that parents should make decisions pertaining to their children’s welfare, and that those decisions are generally in the child’s best interest. The societal expectation that parents should make significant decisions pertaining to a child’s welfare is manifest in statutes that enable parents to exercise their authority on behalf of their minor child in the most important aspects of a child’s life, including significant physical and mental health decisions. Parents are empowered, on behalf of their children to: consent to medical treatment, see Section 20-102 of the Health-General Article, Maryland Code (2000, 2009 RepLVol., 2013 Supp.); consent to having their children give blood, Section 20-101 (b) of the Health-General Article, Maryland Code (2000, 2009 RepLVol.); consent to the use of a tanning ⁷²⁹ device by their child, 11 Section 20 — 106(b) of the Health-General Article, Maryland Code (2000, 2009 Repl.Vol.); and to authorize another family member to consent to the immunization of a minor child, Section 18-4A-02(a) of the Health-General Article, Maryland Code (2000, 2009 RepLVol.). Parents are also empowered to commit a child, under certain conditions, to: a public or private service that provides treatment for individuals with mental disorders, see Section 10-610 of the Health-General Article, Maryland Code (2000, 2009 Repl.Vol.), as well as a private therapeutic group home that provides access to a range of diagnostic and therapeutic mental health services.

See Section 10-923 of the Health-General Article, Maryland Code (2000, 2009 RepLVol.). In addition to empowering parents to make significant health decisions, the General Assembly also has directly enabled parents on behalf of a child to make the most significant decisions pertaining to a child’s education and employment. With respect to education, parents may: choose to home school their children, Section 7 — 301(a)(1) of the Education Article, Maryland Code (1978, 2008 Repl.Vol., 2013 Supp.); and choose to defer compulsory schooling for one year if a parent determines that the child is not mature enough to begin schooling. Section 7-301(a)(2) of the Education Article, Maryland Code (1978, 2008 Repl.Vol., 2013 Supp.).

Additionally, Section 7-305(c) of the Education Article, Maryland Code (1978, 2008 Repl.Vol., 2013 Supp.) mandates that a parent meet with a school superintendent in the event that a child is suspended for more than ten days or expelled from school. With respect to a child’s employment, a child may not work more than is statutorily permitted without a parent giving written consent, Section 3 — 211(b)(1) of the Labor and Employment Article, Maryland Code (1999, 2008 Repl.Vol.); and if the minor child is working for the parent, the wage and hour restrictions are not applicable, thereby leaving it to the par ⁷³⁰ ent’s discretion as to how much the child should work. Maryland Code (1999, 2008 RepLVol.), Section 3-403(a)(7) of the Labor and Employment Article. Parents also are empowered to permit a fifteen to seventeen-year old child to marry, see Section 2-301 of the Family Law Article, Maryland Code (1999, 2012 Repl.Vol., 2013 Supp.); to use corporal punishment to discipline their children, Section 4-501(b)(2) of the Family Law Article, Maryland Code (1999, 2012 RepLVol.); to apply on behalf of a minor child to the “Address Confidentiality Program,” a program designed to ensure that domestic violence victims addresses are kept confidential and from their perpetrators, Section 4-522(a)(2) of the Family Law Article, Maryland Code (1999, 2012 RepLVol.); to bring an action on behalf of their minor child parent for unpaid support payments under the Maryland Uniform Interstate Support Act, Section 10-314 of the Family Law Article, Maryland Code (1999, 2012 Repl.Vol.); and to consent to a child obtaining a hunting license.

Section 10-301(h) of the Natural Resources Article, Maryland Code (2000, 2012 RepLVol.). From this brief survey of various pieces of legislation, it is clear that parents are empowered to make significant decisions on behalf of their children. The Rosens, though, have asserted that there are significant limitations on parental decision-making apparent in legislation, including Section 5-502(b)(1) of the Family Law Article, Maryland Code (1999, 2012 RepLVol.), containing a statement that it is the State’s policy “to protect minor children whose care has been relinquished to others,” which appears as part of a large regulatory scheme applicable to child and foster care facilities. The policy statement, however, merely recognizes the obvious, that children are vulnerable and are entitled to protection.

It does not suggest in any manner, however, that parents are incapable of or limited in contracting on their behalf. The Rosens also have advanced a number of cases that they assert reflect limitations on parental decision-making, all of which, however, are inapposite to define societal expectations ⁷³¹ with respect to a parent’s role in contracting on behalf of her minor child. To support their argument, the Rosens assert first the ability of a minor to disaffirm a contract entered into with an adult, as determined in Schmidt v. Prince George’s Hospital, 366 Md. 535, 553 , 784 A.2d 1112, 1122 (2001); the inability to defend on the basis of contributory negligence against children as young as five, as opined on in Taylor v. Armiger, 277 Md. 638, 648-49 , 358 A.2d 883, 888 (1976); and the prohibition against a parent abdicating her parental responsibilities by contracting away her obligation to support her minor child, as discussed in Geramifar v. Geramifar, 113 Md.App. 495, 503 , 688 A.2d 475, 478 (1997). None of these cases, however, involve a parent acting on behalf of a minor child, and we, therefore, glean no limitations on parental authority from these decisions.

The Rosens, likewise, posit McCormack v. Board of Education of Baltimore County, 158 Md.App. 292, 310 , 857 A.2d 159, 169 (2004), as a limitation on parental exculpation, in which the Court of Special Appeals opined that a parent is permitted to assert or waive the psychologist-patient privilege on behalf of her child absent a substantial conflict of interest with the child. McCormack , too, has no bearing on this matter; it does not address a parent’s right to contract on behalf of her child. The Rosens also rely upon Grimes v. Kennedy Krieger Institute, Inc., 366 Md. 29 , 782 A.2d 807 (2001), a case in which we considered whether it was appropriate for children to be used in a potentially hazardous nontherapeutic research study; as we made clear in Grimes , though, “[t]he issue in these specific contested cases does not relate primarily to the authority of the parent, but to the procedures of [the researchers] and similar entities that may be involved in such health-related studies.” Id. at 104 , 782 A.2d at 852 . The Court of Special Appeals did not rely on these decisions in reaching its decision, nor de we find them persuasive; these decisions do not impose any limitations on a parent’s right to contract on behalf of her child.

With specific reference to a child’s cause of action and parental authority, Section 6-405 of the Courts and Judicial ⁷³² Proceedings Article, Maryland Code (1974, 2013 Repl.Vol.), 12 empowers parents to terminate litigation on behalf of their minor children; it provides that “[a]ny action ... brought by a next friend for the benefit of a minor may be settled by the next friend,” 13 which unequivocally affords parents the authority to settle or release negligence claims on behalf of their minor children. See, e.g., Clark v. Southern Can Co., 116 Md. 85 , 81 A. 271, 273-74 (1911); Bernstein v. Kapneck, 290 Md. 452, 454 , 430 A.2d 602, 603 (1981). Section 6-405(b) of the Courts and Judicial Proceedings Article, moreover, provides that “[i]f the next friend is not a parent or person in loco parentis of the child, the settlement is not effective unless approved by the parent or other person responsible for the child,” thereby empowering parents with the authority to prevent a settlement. The language of Section 6-405(a) of the Courts and Judicial Proceedings Article, which permits a parent to settle a child’s existing claims without judicial interference, notably, is in stark contrast to other states’ statutes and rules that require ⁷³³ judicial oversight to settle a child’s claim, which form the foundation for cases upon which the cases posited by the Rosens rely.

See, e.g., Cooper v. Aspen Skiing Co., 48 P.3d 1229, 1233 (Colo.2002) (noting that pursuant to Colorado statutory law a child’s claim can be settled only by court approval or by a conservator, 14 and concluding, therefore, because a parent generally could not release a minor child’s existing claim it “makes little, if any, sense to conclude a parent has the authority to release a child’s cause of action prior to an injury”); 15 Meyer v. Naperville Manner, Inc., 262 Ill.App.3d 141 , 199 Ill.Dec. 572 , 634 N.E.2d 411, 414 (1994) (opining that pursuant to its statutory and common law a parent may not settle a minor child’s cause of action without court approval, 16 ⁷³⁴ and concluding, therefore, that “[sjince a parent generally may not release a minor child’s cause of action after an injury, there is no compelling reason to conclude that a parent has the authority to release a child’s cause of action prior to the injury”); Hojnowski, 901 A.2d at 387 (noting that pursuant to N.J. R.Super. Tax Surr. Cts. Civ.

R. 4:44 a parent could not settle a minor child’s tort claim without court approval, and opining that the purposes underlying the prohibition against a parent settling a minor child’s tort claim after a cause of action accrues apply equally to a prospective waiver of negligence); Hawkins v. Peart, 37 P.3d 1062, 1066 (Utah 2001) (noting that pursuant to Utah statutory law a child’s cause of action could only be settled if approved by the court or settled by a conservator, 17 and concluding, therefore, that because a parent could not “unilaterally release a child’s claims after a child’s injury ... a parent does not have the authority to release a child’s claims before an injury” (emphasis in original)); Scott v. Pac. W. Mountain Resort, 119 Wash.2d 484 , 834 P.2d 6, 11-12 (1992) (noting that a parent could not settle a minor child’s cause of action pursuant to Wash. Sup.Ct. Spec. P.R. 98.16W without court approval, and concluding that “[sjince a parent generally may not release a child’s cause of action after injury, it makes little, if any, sense to conclude a parent has the authority to release a child’s cause of action prior to an injury”).

Thus, the cases upon which the Rosens rely are inapposite, because parents in Maryland, rather than the courts, are authorized to make decisions to terminate tort claims on behalf of their children pursuant to Section 6-405. 18 ⁷³⁵ The Rosens contend, alternatively, that Section 6-405 is without relevance, arguing that a prospective waiver of a negligence claim as exculpation is “fundamentally different” from a release of an existing claim; our intermediate appellate court similarly opined that unlike a release of an existing claim, an exculpatory clause that prospectively releases a party from liability for negligence “may remove an important incentive to act with reasonable care.” Rosen, 206 Md.App. at 724 , 51 A.3d at 110-11 , quoting Hawkins, 37 P.3d at 1066 . The intermediate appellate court also noted other differences between the two types of releases that, ostensibly, justified their limiting parental authority to prospectively waive a claim for negligence: [Prospective exculpatory] clauses are “routinely imposed in a unilateral manner without any genuine bargaining or opportunity to pay a fee for insurance,” unlike post-injury releases of liability, which “involve actual negotiations concerning ascertained rights and liabilities,” and that, “if anything, the policies relating to restrictions on a parent’s right to compromise an existing claim apply with even greater force in the preinjury, exculpatory clause scenario.” ⁷³⁶ Id. at 724-25, 51 A.3d at 110-11 , quoting Hawkins, 37 P.3d at 1066 . The policy dichotomy proscribed, however, by the Rosens and the Court of Special Appeals has at its core stereotypes that warrant further exploration by the Legislature, rather than that which should be relied upon in judicial decision-making. The preconceptions utilized are pro hac differentiation 19 not in conformity with any of the schemata delineated empowering a parent to act on behalf of a minor child.

Section 6-405 reveals a societal expectation that parents, and not courts, should determine whether to release a child’s claim for negligence; superimposing a legislative purpose to exclude prospective exculpation is without foundation. ⁷³⁷ The Rosens assert, however, that parental decision-making with respect to a minor child’s tort claim is limited by Sections 13-401 et seq. of the Estates and Trusts Article, Maryland Code (2001, 2011 RepLVol.), requiring, inter alia, that tort awards recovered by a minor exceeding $5,000 be placed in trust, and moreover, limits access to those funds for limited reasons, such as educational or medical needs. Section 13-402 of the Estates and Trusts Article clearly states, in reference to Sections 13-401 et seq., that “judgment in tort should be preserved for the benefit of the minor,” limiting the parent’s use of the settlement or judgment money, but not the authority to terminate a claim. The Rosens similarly advance Section 5-201 of the Courts and Judicial Proceedings Article, Maryland Code (1974, 2013 RepLVol.), as a limitation on parental decision-making with respect to a child’s tort claim. Section 5-201 tolls the statute of limitations when a minor has been injured, providing that that a cause of action “accrues ... within the lesser of three years or the applicable period of limitations after the date the disability is removed.” The statute serves to provide a child with an opportunity to pursue a claim upon attaining the age of majority only if the child’s parent did not pursue the claim on the child’s behalf during her minority.

A parent continues to have the power to initiate and terminate a suit during infancy. 20 We, therefore, glean no limitations on a parent’s right to terminate a minor child’s tort claim from these statutes. Now that we have explored societal expectations as discerned by statutory and common law, we turn to the juxtaposition of the instant facts against those expectations. ⁷³⁸ This case involves the decision made by Mr. Rosen to sign an exculpatory agreement on his behalf and that of his children. Our review of our statutes and cases reflect a societal expectation that a parent’s decision-making is not limited. The Court of Special Appeals, likewise, did not assert any limitation on a parent’s right to prospectively waive a minor child’s tort claim.

We conclude, therefore, that Mr. Rosen’s execution of an exculpatory agreement on behalf of Ephraim to allow him to use the Kids’ Club was not a transaction affecting the public interest within the meaning of Wolf , which otherwise would have impugned the effect of the agreement. The Court of Special Appeals’s decision, however, rested upon two other considerations aside from the Wolf decision. The intermediate appellate court rooted its opinion on a perceived distinction between commercial and non-commercial enterprises, opining that “because commercial enterprises ‘derive economic benefit from’ the provision of their services, ‘they are better able to bear the costs