# U ni te d S ta te s Co ur t of A pp ea ls

For the Eig hth Circu it

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No. 1 5- 35 97

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Ken ne th Ste wart , Jr.

ll ll ll ll ll ll ll ll ll ll l Pla in ti

ff - App el la nt

v.

Nuc or Co rp or at io n

ll ll ll ll ll ll ll ll ll ll l Defe nd

an t - Ap pe ll ee

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App eal fro m

Uni te d S ta te s Di st ric t Co ur t fo r th e Eas te rn Dis tri ct of Ark an sa s - J on es bo ro

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Su bm it te d: Apri l 1 2, 2 01 6
Fil ed : J ul y

15 , 20 16

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Befo re WOL LMAN, BEAM, an d M URPHY, Ci rcu it Ju dg es

.

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BEAM, Ci rcu it Ju dg e.

Ken ne th St ewart

, Jr

. ap pe al s th e d is tri ct co ur t's ad ve rs e gr an t of su m m ary 1
jud gm en t in hi s ne gl ig en ce su it ag ai ns t Nuc or Co rp or at io n fo r in ju rie s su st ai ne d

whi le work in g a t Nu co r's st eel m il l. We affir m

.

The Hon or ab le Kris ti ne G. Bak er, Uni te d St at es Dis tri ct Ju dg e fo r th e East ern 1

Dis tri ct of Ark an sa s.I. BACKGRO UND

Ves uv iu s USA co nt ract ed wit h Nuco r to pr ov id e it wit h pe rs on ne l to wor k at

Nuc or 's Bl y th ev il le

, Ark an sa s, st eel m il l, an d it hi red St ewart

, a weld er, fo r th is

pu rp os e. Dur in g tra in in g, St ewart si gn ed a waiv er of cl ai m s fo r in juri es co ve red by

wor ke rs ' co m

pe ns at io n ag ai ns t Ves uv iu s's co nt ract ees (th e "Th ird -Par ty W ai ve r" or

TPW ). The TPW read :

WAI VER OF CLAIMS AND SUIT S AGAINS T THI RD-PARTIE S

R E L ATI NG TO INJ URIES COVERED BY WO RKERS'
COMPENSATI ON

As a co nd it io n of m

y {em pl oym en t} {co n t in ue d em pl oym en t}
wit h Ves uv iu s an d in reco gn it io n of t he fact th at an y wor k- rel at ed
in juri es th at m ig ht be su st ai ne d by m e or co ve red by st at e W or ke rs '
Co m pe ns at io n la ws, I he reb y waiv e, to th e ex te nt pe rm it te d by la w, an y rig ht I m ig ht ha ve t o mak e cl ai m s or br in g su it s ag ai ns t th e fo ll owi ng cl as se s or cat eg or ie s of pe rs on s or en ti ti es ari si ng ou t of or as a res ul t of
in juri es su st ai ne d by m e, whi ch are co ve red un de r wor ke rs '

co m pe ns at io n l aws : (a) Any pe rs on s or e n t i t i e s ha vi ng own ers hi p, p os se ss io n, o r

co nt r o l of or ov er th e pr em is es or wor k si te s at whi ch m y

wor k wi ll be pe rfo rm ed ; (b ) Any pe rs on s or en ti ti es act in g as arch it ect s, en gi ne ers , or

co ns tru ct io n man a ge rs wit h res pe ct to wor k be in g
pe rfo rm ed or to be pe rfo rm ed at th e pr em is es or wor k si te s
at whi ch m

y work wil l b e p erfo rm ed ; (c) Any pe rs on s or en ti ti e s p e rfo rm in g wor k at

, on , or ab ou t

t h e p r em is es or wor k si te s at whi ch m y wor k wil l b e
pe rfo rm ed ; (d ) Any co nt ract or s or su bc on tra ct or s pe rfo rm in g an y po rti on of th e wor k at or ab ou t th e pr em is es or wor k si te s at whi ch

m y work wil l b e p erfo rm ed ;

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-(e) Any pe rs on s or en ti ti es th at Ken St e w a r t may ha ve

co nt ract ua l or im

pl ie d ob li ga ti on s to in de m ni fy ari si ng ou t of an y su ch in juri es ; an d (f) Any ag en ts

, se rv an ts

, or em pl oyees of an y of th e pe rs on s or

en ti ti es in th e cl as se s or cat eg or ie s se t ou t in (a) th ro ug h (e), ab ov e.

The un de rli ne d p or ti on s ab ov e were f il le d i n b y

ha nd by Stewart

.

On th e da y of tra in in g, St ewart fir st sp en t te n to twel ve ho ur s watc hi ng tra in in g
vi de os at two di ffer en t lo cat io ns

. He was th en ta k e n t o N u c o r, gi ve n a st ack of

pa pe rwo rk th at in cl u d e d th e TPW

, an d se nt in to a ro om wit h a vi de o pl ay er. The

tra in er in st ru ct ed St ewart to pl ay so m e vi de os an d an swe r qu es ti on s ab ou t th em

. (The

pa pe rwo rk in cl ud ed q u iz zes pe rta in in g to th e vi de os .) St ewart was un de r th e

im pr es si on th at he ha d t o p as s t he qu iz zes in ord er t o b e h ire d. W hi le watc hi ng th e
vi de os , St ewart al so co m pl et ed th e ot he r pa pe rwo rk

, in cl ud in g th e TPW

. S te wart

te st ifi ed th at th e tra in er was pr ep ari ng to le av e fo r th e da y an d ap pa ren tl y wan te d to

co m pl et e th e tra in in g qu ic kl y, a n d a s a res ul t St ewart fel t ru sh ed to co m pl et e th e

pa pe rwo rk

.

Late r, whi le wor ki ng at Nuc or 's st eel m il l, St ewart was i nju red , for whi ch he

rece iv ed wor ke rs ' co m

pe ns at io n be ne fit s. He su ed Nuc or fo r ne gl ig en ce, an d Nuc or

m ov ed fo r su m

m ary jud gm en t on th e ba si s of th e TPW

. The di st ric t co ur t gr an te d th e

m ot io n, fin di ng th at th e TPW 's la ng ua ge an d th e ci rcu m st an ces of it s ex ecu ti on m et

th e st an da rd fo r en fo rcem en t of ex cu lp at or y co nt ract s un de r A r k a n s as la w a nd th at

th e ag reem en t was no t u nc on sc io na bl e. Ste wart ap pe al s.

II

. DISCUSS IO N

Thi s is a di ve rs it y act io n oc cu rri ng in Ark an sa s, an d so we ap pl y Ark an sa s la w.

"We rev ie w de no vo th e di st ric t c o u r t 's gr an t of su m m ary jud gm en t, vi ewin g th e

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-ev id en ce in th e li gh t m os t fav o rab le to th e no nm ov in g pa rty," Ro bi ns on v. Terex

Co rp ., 43 9 F.3 d 46 5, 46 7 (8 th Ci r. 20 06 ), as well as it s in te rp ret at io n of Ark an sa s la w.
Id

. "Su m m ary jud gm en t is pr op er if th ere are no di sp ut ed is su es of m at eri al fact an d

th e m ov in g pa rty i s e n t i t l ed to jud gm en t as a m at te r of la w." Id

. The di st ric t co ur t

co ns id ered two is su es in gr an ti ng Nuc or 's m ot io n: whe th er th e TPW was en fo rcea bl e

an d wh et he r it was u nc on sc io na bl e.

A. Enfo rcea bi li ty

"An ex cu lp at or y co nt ract is on e in whi ch a pa rty se ek s to ab so lv e hi m se lf in

ad va nc e fo r th e co ns e q u e n c e s o f hi s own ne gl ig en ce." Fi na gi n v. Ark

. Dev

. Fi n.

Aut h., 13 9 S.W .3d 79 7, 80 6 (Ark

. 20 03 ). Exc ul pa to ry co nt ract s are di sf av or ed by th e

Ark an sa s Su pr em e Co ur t, Pl an t v. W il bu r, 47 S.W .3d 88 9, 8 93 (Ark . 2 00 1) , a nd as

su ch m us t c l e a r ly se t ou t th e li ab il it y to be av oi de d an d are to be st ric tl y co ns tru ed

ag ai ns t th e dr aft er. Fi na gi n, 13 9 S.W .3d at 80 6. The y m ay be en fo rced "(1 ) whe n th e

pa rty i s k n o w l e d ge ab le of th e po te nt ia l li ab il it y th at is rel eas ed ; (2 ) whe n th e pa rty

i s b e ne fit in g fro m th e act iv it y whi ch m ay le ad to th e po te nt ia l li ab il it y th at i s
rel eas ed ; an d (3 ) whe n th e co nt ract th at co nt ai ns th e cl au se was fai rly en te red in to ."

Id

. at 80 8. The Ark an sa s Su pr em e Co ur t ha s fo ll owe d ou r ci rcu it in ad op ti ng a "t ot al

tra ns act io n" ap pr oa ch to ex cu lp at or y co nt ract s, as cert ai ni ng th e in te nt of th e pa rti es

acco rd in g to bo th th e la ng ua ge of th e co nt ract as well as t h e c i r c u msta nc es of it s

ex ecu ti on

. Pl an t, 47 S.W .3d at 89 3 (ci ti ng Hain es v. St

. Ch arl es Sp eed way , In c., 87 4

F.2 d 5 72 , 57 5 (8 th Cir . 19 89 )).

St ewart ch al le ng e s el em en ts (1 ) an d (3 ), cl ai m in g th at th e ci rcu m st an ces

su rro un di ng hi s si gn in g th e TPW –b ei ng gi ve n th e TPW at th e e n d o f a lo ng da y of

tra in in g, feel in g co m

pe ll ed to pa y at te nt io n to vi de os he was be in g qu i z z e d o n , be li ev in g he ne ed ed to pa ss th os e qu iz zes to be hi red

, an d feel in g ru sh ed by th e

tra in er– crea te a ge nu in e di sp ut e of m at eri al fact as to whe th er he was kn owl ed ge ab le

of th e po te nt ia l li ab il it y he wa s w a i v i n g an d whe th er he fai rly en te red in to th e

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-co nt ract

. Nuc or po in ts ou t th at Ste wart ad m it te d in te st im on y th at he was gi ve n an

op po rtu ni ty to rev ie w th e co nt ract

. It is un di sp ut ed he ha s a hi gh sc ho ol di pl om a an d

th e ab il it y to read , and th ere i s n o e vi de nc e St ewart ask ed ab ou t t he m ean in g o f th e

TPW or t he co ns eq ue nc es of n ot si gn in g i t.

St ewart ha s no t crea te d a ge nu in e is su e of m at eri al fact as to th e en fo rcea bi li ty

of th e TPW

. The pa rti es st ip ul at ed th at he ha d th e op po rtu ni ty to read th e TPW

, th at

he di d no t as k th e tra in er an y qu es ti on s co nc ern in g th e m ean in g of th e TPW

, an d th at

he ha d th e ab il it y to read an d un de rs ta nd th e co nt ract

. St ewart m ig ht ha ve fel t tir ed

fro m th e lo ng da y of tra in in g, di st ract ed by th e vi de os , an d ru sh ed by th e tra in er. Bu t

th es e fact s al on e do no t am ou nt to co nd it io ns su ffi ci en t to r e n d e r th e TPW

un en fo rcea bl e. Thi s is so pa rti cu la rly be cau se St ewart was in di sp ut ab ly affo rd ed th e

op po rtu ni ty, whi ch he fai le d to av ai l hi m se lf of

, to in qu ire ab ou t th e m ean in g of th e

TPW

. The la ng ua ge of th e TPW is no t so ov erl y co m pl ex or rid dl ed wit h le ga l jarg on

as to cal l in to qu es ti on St ewart 's ab il it y to un de r s t a n d it

. "Ul ti m at el y , [St ewart ] is

bo un d to kn ow th e co nt en ts of th e co nt ract th at he si g n e d

. " J or da n v. Diam on d
Equ ip

. & Su pp ly Co

., 20 7 S.W .3d 52 5, 53 2 (Ark

. 20 05 ). W e affi rm th e di st ric t co ur t

as to en fo rcea bi li ty of th e TPW.

B. Unco ns ci on ab il ity

In as se ss in g whe th er a co nt ract pr ov is io n is un co ns ci on ab le

, Ark an sa s co ur ts

ag ai n lo ok to th e to ta li ty of th e ci rcu m st an ces , co ns id eri ng "wh et he r th ere is a gr os s

in eq ua li ty of ba rg ai ni ng po wer be twee n th e pa rti es an d whe th er th e ag gr ie ve d pa rty

was m ad e aware o f a n d c o m pr eh en de d th e pr ov is io n in qu es ti on ." Jo rd an , 20 7

S.W .3d at 53 5. App lying Ark an sa s la w, we ha ve al so co ns id ered "wh et he r th e

pr ov is io n is co m

m erci al ly reas on ab le 'acc or di ng to th e m or es an d bu si ne ss pr act ic es

of th e ti m e an d pl ace.'" Geld erm an n & Co

., In c. v. Lan d P ro ces si ng , Inc ., 52 7 F .2d

57 1, 57 6 (8 th Ci r. 19 75 ) (q uo ti ng 1 Arth ur L. Co rb in

, Co nt ract s § 12 8, at 55 1 (1 96 3) ).

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-St ewart pr es en ts t h e s am e arg um en ts he re th at he do es fo r th e en fo rcea bi li ty

is su e. Nuc or po in ts to an affi da vi t it su bm it te d fro m th e C EO o f an in du st ria l

co ns tru ct io n an d m ai nt en an ce co nt ract or th at ha s an of fic e in Bl y th ev il le

, st at in g th e

co m pa ny hi red si x weld ers du rin g th e rel ev an t ti m e pe rio d. Nuc or arg ue s th is sh ows

th e av ai la bi li ty of ot he r wor k St ewart co ul d ha ve so ug ht an d th us th at th ere was no t

a gr os s in eq ua li ty in ba rg ai ni ng po wer. The di st ric t co ur t no te d t h a t n e i t he r pa rty

pr es en te d reco rd ev id en ce of rel ev an t in du st ry pr act ic es bu t th at Nuc or ci te d to cas es

reco gn iz in g t he va li di ty of su ch ag reem en ts un de r co m pa rab le cir cu m st an ces . See,

e.g ., Edg in v. En te rg y

Oper at io ns , Inc ., 96 1 S .W .2d 72 4 (Ar k. 1 99 8)

.

St ewart ha s no t crea te d a ge nu in e is su e of m at eri a l f a c t as to th e

un co ns ci on ab il it y of th e TPW

. He do es no t pres en t any ev id en ce reb ut ti ng Nuc or 's

affi da vi t sh owi ng th e av ai la bi li ty of ot he r wor k in th e reg io n at th at ti m e. It is

un di sp ut ed he ha d th e op po rtu ni ty to read an d un de rs ta nd th e TPW

. Rev ie win g th e

la ng ua ge , it is no t es pe ci al ly co m pl ic at ed or di ffi cu lt to un de rs ta nd

. Alt ho ug h th ere
is no reco rd ev id en ce of in du st ry pr act ic e, Edg in ad dr es s ed pr eci se ly th e sa m e so rt

of co nt ract at is su e he re– waiv er of cl ai m s by a n e mp l o yee ag ai ns t th e em pl oyer's

cl ie nt s fo r in

juri es th at can be cl ai m ed un de r wor ke rs ' co m pe ns at io n– an d up he ld th e

ap pl ic at io n of th e ag reem en t to fo recl os e th e pl ai nt iff -em pl oyee's ne gl ig en ce act io n.
Add it io na ll y , th ere is no ev id en c e p r e s en te d by St ewart of frau d, du res s,

m is rep res en ta ti on , or an y ot he r in eq ui ta bl e co nd uc t on th e pa rt of Ves uv iu s or Nuc or

. W e al so affi rm

th e d is tri ct co ur t o n t he un co ns ci on ab il it y is su e.

II I. CONCLUSI ON

Fo r th e fo reg oi ng reas on s we a ffi rm

.

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