## F I L E D United States Court of Appeals Tenth Circuit 

### OCT 9 2002 

### PATRICK FISHER Clerk PUBLISH
UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

ROY MINCIN and KEMPER INSURANCE COMPANIES, an Illinois corporation,

Plaintiffs - Appellants,

v. VAIL HOLDINGS, INC., a Colorado corporation, also known as Vail Associates, Inc.; VAIL ASSOCIATES, INC., a Colorado corporation,

Defendants - Appellees. No. 01-1256

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO (D. Ct. No. 99-M-1676)
Kristin M. Murphy, Denver, Colorado (Robert A. Wein berger, Denver, Colorado, for Appellant Kemper Insurance Co., and Glen F. Gor don, Boulder, Colorado, for Appellant Roy Mincin, with her on the briefs), appe aring for Appellants. Jere K. Smith (Peter W. Rietz, with her on the brie f), Rietz and Smith, L.L.C., Dillon, Colorado, appearing for Appellee.

Before TACHA , Chief Circuit Judge, HENRY , and BRISCOE , Circuit Judges.

TACHA , Chief Circuit Judge.-2-

Plaintiffs Roy Mincin and Kemper Insurance Co. (“Ke mper”) appeal the district court order granting partial summary judgm ent for the defendants and denying partial summary judgment for the plaintiffs . We exercise jurisdiction pursuant to 28 U.S.C. § 1291 and AFFIRM. I. Background Roy Mincin decided to go mountain biking while on a business trip in Vail, Colorado. At the base of Vail Mountain, he p urchased a gondola lift ticket and a bike rental coupon, which he was instructed t o redeem at the bike rental area atop the mountain. At the rental area, Mincin was presented with a Bicycle Rental Agreement which contained exculpatory langua ge and which he signed without reading completely. The Bicycle Rental Agr eement read:
PLEASE READ CAREFULLY. THIS IS A RELEASE OF LIABIL ITY AND WAIVER OF LEGAL RIGHTS. I acknowledge that participation in mountain biking or transporting a mountain bike up a ski lift (the “Activity”) is HAZ ARDOUS and involves a great risk of physical injury. I expressly assume all risks associated with participating in the Activity, including without li mitation: changing weather conditions; existing and changing trail conditions; rocks; stumps; trees; erosion; collisions with natural objects; man-made objects; or other persons; and variations in terrain. Despite all th e risks, I voluntarily choose to participate in the Activity. I agree to utilize only marked bicycle trails . . . at all times. . . . In consideration of renting the equipment and recei ving permission to take part in the Activity, I agree to release and hold h armless Vail Associates, Inc., its subsidiaries and affiliates, the United S tates Department of-3-

Agriculture Forest Services, their representative a gents, officers, directors, owners, coordinators and employees (collectively, the “Released Parties”) for any and all claims I might state as a result of physical injury, including death, or property damages sustained in connection with the Activity, including those claims based on negligence or breac h of warranty. I agree to indemnify the Released Parties for any c laims whatsoever brought by a third party which I may cause.

. . . . This agreement is binding on my estate, heirs, admi nistrators and assigns and shall be governed by the laws of Colorado.
Mincin was riding the mountain bike on a designatedtrail when he was diverted into the grass by an anomaly in the trail. Mincin reasoned that he would be able to rejoin the trail in a matter of seconds by continuing straight through the grass. He ran into an unmarked man-made drainage d itch, however, which was adjacent to the designated trail and concealed by h igh grass. Mincin suffered serious injuries, including paraplegia. Kemper is the worker’s compensation insurance carri er for Mincin’s employer. Mincin received worker’s compensation be nefits from Kemper for his injuries. Mincin filed suit in the United States District Cou rt for the District of Colorado against Vail Holdings, Inc. and Vail Assoc iates, Inc. (collectively “Vail”). Kemper filed a separate action against Va il to recover monies paid to-4-

Mincin as a result of his personal injuries. Kempe r later dismissed that action and joined Mincin’s. The parties filed cross-motions for partial summaryjudgment concerning the effect of the Bicycle Rental Agreement. The di strict court granted Vail’s motion and denied the plaintiffs’ motion, holding t hat the exculpatory clause was valid under Colorado law and that the Bicycle Renta l Agreement therefore barred the action for both Mincin and Kemper. Mincin and Kemper then moved to dismiss their remaining claims in order to secure afinal judgment. II. Discussion.
A. Standard of Review We review the grant of a motion for summary judgmen t de novo. Applied Genetics Int’l, Inc. v. First Affiliated Sec., Inc. , 912 F.2d 1238, 1241 (10th Cir. 1990). Summary judgment is appropriate “if the ple adings, depositions, answers to interrogatories, and admissions on file, togethe r with the affidavits, if any, show that there is no genuine issue as to any mater ial fact and that the moving party is entitled to a judgment as a matter of law. ” F ED
. R. C IV
. P. 56(c). We construe all facts and make reasonable inferences i n the light most favorable to the nonmoving party. Mauldin v. Worldcom, Inc. , 263 F.3d 1205, 1211 (10th Cir. 2001). The nonmoving party may not, however, rely solely on its pleadings but must set forth specific facts showing that there is a genuine issue for trial with1 Because we conduct an independent review of the re cord, we do not

address the district court’s language that plaintif fs argue constituted a decision on an issue of material fact. -5- regard to those dispositive matters for which it ca rries the burden of proof. Celotex Corp. v. Catrett , 477 U.S. 317, 324 (1986). 1 A federal court sitting in diversity applies the su bstantive law of the forum state. Commerce Bank, N.A. v. Chrysler Realty Corp

. , 244 F.3d 777, 780 (10th Cir. 2001). We review de novo the district court’s interpretation of Colorado state law. Id.
B. Consideration Mincin argues that because he paid for the bicycle at the bottom of the mountain and did not sign the Bicycle Rental Agreem ent until he actually received the bicycle at the top of the mountain, th e Bicycle Rental Agreement constituted a modification to the initial rental ag reement and therefore required additional consideration. We disagree. Under Colorado law, a contract modification general ly requires additional consideration. Hoagland v. Celebrity Homes, Inc. , 572 P.2d 493, 494 (Colo. Ct. App. 1977) (citing H & W Paving Co. v. Asphalt Pavi ng Co. , 364 P.2d 185, 186 (Colo. 1961)). Where there is a sufficient time lapse between the initial agreement and the subsequent alteration, Colorado c ourts characterize the subsequent change as a contract modification requir ing separate consideration.-6-

For example, in H & W Paving Co. , the Colorado Supreme Court held that a change to a contract made several months after the original contract was signed required additional consideration. 364 P.2d at 186. Similarly, in Hoagland , the Colorado Court of Appeals held that a release from liability signed eight months after the initial contract required additional cons ideration. 572 P.2d at 494. In the instant case, however, the two events were s eparated by a matter of minutes and are better considered part of the same transaction. Mincin paid for the bicycle rental and gondola lift ticket at the b ottom of the mountain, where he received a coupon for the bicycle rental. He then rode the gondola to the top of the mountain, where he was presented with the Bicyc le Rental Agreement while being fitted for and before being presented with hi s bicycle. Under these circumstances, we hold that the Bicycle Rental Agre ement did not constitute a modification to the initial agreement. Hence, the Bicycle Rental Agreement required no additional consideration in order to be enforceable. See Beehner v. Cragun Corp. , 636 N.W.2d 821, 829 (Minn. Ct. App. 2001) ("This court has held that an exculpatory agreement signed after a fee to participate in a recreational activity has been paid is part of the same transact ion and is therefore enforceable without additional consideration other than permiss ion to participate in the activity."); Hewitt v. Miller , 521 P.2d 244, 248 n.3 (Wash. Ct. App. 1974) (concluding that release signed by scuba diving stu dent after payment of fee was-7-

an integrated part of the whole transaction and was thus supported by original consideration).
C. The Validity of the Exculpatory Clause The district court found that the exculpatory claus e in the Bicycle Rental Agreement signed by Mincin was valid, and therefore dismissed Mincin’s claim. Plaintiffs claim that the district court erred both in upholding the exculpatory clause and in its interpretation of the clause. We disagree. In determining whether an exculpatory agreement is valid under Colorado law, we must consider four factors: (1) whether th e service provided involves a duty to the public; (2) the nature of the service p rovided; (3) whether the agreement was fairly entered into; and (4) whether the agreement is clear and unambiguous. Jones v. Dressel , 623 P.2d 370, 376 (Colo. 1981). Each of the following militates against the validity of an excu lpatory clause: a duty to the public; that the service provided is a “practical n ecessity”; unfairness; and ambiguity. Id. Regarding the first factor, plaintiffs contend thatmountain biking is an issue of public concern and involves a public duty. In s upport of this contention, plaintiffs rely upon language in Stanley v. Creighton , 911 P.2d 705 (Colo. Ct. App. 1996). In Stanley , the Colorado Court of Appeals invalidated an excu lpatory clause in the context of a residential lease. Id. at 709. In concluding that the-8-

landowner-residential tenant relationship involved a public interest sufficient to invalidate an exculpatory agreement, the Stanley court relied in part on the Colorado Premises Liability Act (“CPLA”), Colo. Rev. Stat. § 13-21-115. Id. at 707. The court noted that the CPLA “confirms that landowner negligence is an issue of public concern.” Id. Relying on this language, plaintiffs argue that exculpatory agreements are per se invalid in the context of negligence suits against landowners for damages sustained on their propertie s. We reject this broad construction of Stanley for two reasons. First, although the Stanley court relied in part on the CPLA, the court placed greater emphasis on the essential nature of residential housing. Id. at 707-08. Landowner-residential tenant relations implicate a heightened degree of public concern as “housing rental is a matter of practical necessity to the public.” Id. at 708. The court further noted the Colorado General Assembly’s continuous regulation of the landowner-residential tenant relationship over the past thirty years. Id. at 707. Second, other language in Stanley is inconsistent with plaintiffs’ position. Later in its opinion, the court alluded to a distin ction between residential and commercial leases, implying that an exculpatory cla use might well be valid in the context of a commercial lease. Id. at 708. Such disparate treatment of commercial and residential tenants is, of course, at odds with plaintiffs’ proffered-9-

interpretation of Stanley

. The commercial-residential distinction drawn in Stanley is in accord with numerous cases under Colorado law upholding exculpatory agreements in other commercial and recreational contexts. In fact, a n umber of these cases specifically hold that a recreational activity does not involve a public duty: It is the essential nature of the service that give s the party seeking exculpation an unfair bargaining advantage and resu lts in the contract running afoul of public policy. The service here i s recreational. Although skiing is a recreational activity enjoyed by many, by definition and common sense, it is neither a matterof great public importance nor a matter of practical necessity. Th erefore, there is no public duty that prevents enforcement of this agree ment. Bauer v. Aspen Highlands Skiing Corp. , 788 F. Supp. 472, 474 (D. Colo. 1992) (upholding an exculpatory clause in the context of ski equipment rental); see also Lahey v. Covington , 964 F. Supp. 1440, 1445 (D. Colo. 1996) (same reg arding white water rafting); Brooks v. Timberline Tours, Inc. , 941 F. Supp. 959, 962 (D. Colo. 1996) (same regarding snowmobiling); Jones , 623 P.2d at 377-78 (same regarding skydiving). Plaintiffs attempt to distinguish these cases as in volving skiing and horseback riding, both of which are activities cove red by Colorado statutes specifically limiting landowner liability. See C OLO
. REV
. S TAT . §§ 33-44-101 to - 114 (“Ski Safety Act”); id. § 13-21-119 (equine and llama activities); Bauer , 788 F. Supp. at 474-75 (skiing); B & B Livery, Inc. v. Riehl , 960 P.2d 134, 138 (Colo.-10-

1998) (upholding exculpatory agreement in the conte xt of horseback riding, because the agreement was unambiguous). Plaintiffs argue that because statutes limit landowner liability in these particular comme rcial settings but not in the context of mountain biking, we should not limit lan downer liability in the context of bicycle rental, under the maxim expressio unius est exclusio alterius . Harris v.
Owens , 264 F.3d 1282, 1296 (10th Cir. 2001). This maximrepresents the principle that “t he expression of one thing is the exclusion of ano ther.” Id. This argument fails for two reasons. First, plaint iffs’ argument misconstrues the issue in this case. The issue is not whether the Colorado General Assembly has limited landowner liability or whetherthis court should do so. Rather, it is whether Mincin and Vail could agree to limit Vail’s liability – that is, whether an exculpatory clause is valid in the conte xt of a commercial bicycle rental agreement. The fact that the Colorado legis lature has limited landowner liability in the contexts of horseback riding and s kiing is relevant to the question of whether landowner liability might be limited in other circumstances absent a
contract . It is irrelevant, however, to the issue in this case – whether an exculpatory agreement is enforceable in the contextof a bicycle rental agreement. Second, plaintiffs ignore those cases involving Col orado law in which no specific statute governed the transaction and the c ourt upheld an exculpatory agreement. E.g. , Mullan v. Quickie Aircraft Corp. , 797 F.2d 845, 852-53 (10th2 Contrary to plaintiffs’ assertions, finding the ex culpatory clause valid

does not abrogate the Colorado Premises Liability A ct. The CPLA does not speak (continued...) -11- Cir. 1986) (sale of aircraft kit); Lahey , 964 F. Supp. at 1445 (white water rafting); Brooks , 941 F. Supp. at 962 (snowmobiling); Jones , 623 P.2d at 377-78 (skydiving). The numerous cases upholding exculpat ory agreements in a variety of commercial contexts severely undercut plaintiffs’ t heory that such agreements are
per se unenforceable in the area of landowner negligence. Consideration of the second and third Jones factors – the nature of the service provided and whether the agreement was ente red into fairly – further undermines plaintiffs’ claim. The Stanley court stressed the disparity of bargaining power created by the “practical necessity” of housing rental in reaching its decision to invalidate the exculpatory clause i n the context of the landownerresidential tenant relationship. Id. at 708. In this case, however, there is no such “practical necessity” as mountain biking is not an essential activity. Thus, Mincin did not enter into the contract from an inferior ba rgaining position. Further, Mincin fails to point to any other unfair circumsta nces surrounding the parties’
contract. Thus, the first three Jones factors militate against plaintiffs’ broad interpretation of Stanley . Stanley does not represent a per se prohibition against exculpatory agreements in the context of negligence suits against landowners. 22 (...continued)

to exculpatory agreements. The CPLA is relevant to this case only insofar as it demonstrates that, at least in some circumstances, premises liability is an issue of public concern grave enough to invalidate an otherw ise valid exculpatory agreement. We also do not see the relevance of the fact that alandowner cannot delegate duties under the CPLA to, for example, an independent contractor. Springer v. City and County of Denver , 13 P.3d 794, 804 (Colo. 2000). The fact that certain duties of a landowner are nondelegable does not mean that the landowner and the party to whom the duty is owed may not contract to extinguish those duties altogether. -12- This construction of Stanley best comports with the standard for identifying a public duty under Colorado law, as first articulated in Jones . The Jones court provided the following guidance regarding the types of services that involve public duties and instances in which exculpatory agreement s might trigger fairness

concerns: The party seeking exculpation is engaged in perform ing a service of great importance to the public, which is often a matter of practical necessity for some members of the public. . . . As a result of the essential nature of the service, in the economic se tting of the transaction, the party invoking exculpation possess es a decisive advantage of bargaining strength against any memberof the public who seeks his services. 623 P.2d at 376 (quoting Tunkl v. Regents of Univ. of Cal. , 383 P.2d 441, 444 (Cal. 1963)). Thus, Stanley is distinguishable from the present case in that t he public need and disparity of bargaining power prese nt in the landowner-residential tenant area are wholly absent in the context of mou ntain biking and bicycle rental. The final factor of the Jones test requires us to consider whether the-13-

agreement is clear and unambiguous. We agree with the district court that the language of the exculpatory agreement is unambiguou s. A contractual term is ambiguous when it is susceptible to more than one r easonable interpretation. Browder v. U.S. Fid. & Guar. Co. , 893 P.2d 132, 133 (Colo. 2000). Plaintiffs first argue that the exculpatory clause is ambiguous as t o whether it bars claims by subrogees. In support of this position, plaintiffs point to Rowan v. Vail Holdings,
Inc. , 31 F. Supp. 2d 889 (D. Colo. 1998). In Rowan , a skier signed an exculpatory agreement that released Vail from “any and all claims I might state.” Id. at 893. The agreement also contained language binding the a greement on “my estate, heirs, administrators and assigns.” Id. The court found that this discrepancy rendered the agreement ambiguous as to whether the skier’s parents could institute a wrongful death suit, which is based on a statutory cause of action belonging to a decedent’s heirs. Id. at 899. The court reasoned that “claims ‘I’ mightstate are, by necessity, limited to those of the signatory. . . . A wrongful death action is not encompassed by such language, since Rowan could notassert such a claim on his own behalf. Instead, a wrongful death claim is an independent action belonging to Rowan’s heirs.” Id. The instant case is distinguishable. It is true th at the rental agreement signed by Mincin contained language almost identical to that found in Rowan . In contrast to a wrongful death claim, however, a subr ogation claim is not an-14-

independent action. “Subrogation is the right of the insurer to be put in the position of the insured in order to pursue recovery from third parties leg ally responsible to the insured for a loss the insurer has paid.” Porter v. Castle Rock Ford Lincoln Mercury, Inc. , 895 P.2d 1146, 1148 (Colo. Ct. App. 1995) (emphas is added). Indeed, “it is elementary that one cannot acquire by subrogation what another whose rights he claims did not have.” Browder , 893 P.2d at 136 n.4 (quoting U.S. v. Munsey Trust Co. , 322 U.S. 234, 242 (1947)). Accordingly, because a subrogation claim by Kemper asserts Mincin’s rights, it is plainly precluded by the “I might state” language of the ex culpatory agreement. Plaintiffs also contend that the expressio unius canon of construction operates to exclude subrogation claims from the purview of the exculpatory clause. Plaintiffs argue that, because the agreement explic itly binds Mincin and his estate, heirs, administrators, and assigns, but is silent a s to subrogees, it does not bind Kemper. Again, however, the crucial point is that a subrogation claim is not an independent claim. Mincin waived his right to sue when he signed the agreement. Therefore, no basis for a subrogation claim exists. See Porter , 895 P.2d at 1148 (“The insurer’s right of subrogation is derived sol ely from the rights of its insured and is limited to those rights.”). Thus, Mincin’s release waived any subrogation right Kemper might have otherwise possessed. The e xculpatory clause is unambiguous on this point.3 The agreement in Rowancontained a similar proscription against bringing

suit. However, it also contained specific language that arguably limited its application to the risks inherent in skiing. The l anguage here creates no such ambiguity. -15- Nor is there any ambiguity as to the type of claim that is barred by the agreement. The agreement covers “any and all claim s I might state . . . including those claims based on negligence or breach of warra nty.” The agreement bars Mincin from bringing suit for any and all claims, t hen makes clear that breach of warranty and negligence claims are contained within that prohibition. There is nothing ambiguous about this portion of the agreement. 3 Plaintiffs also invoke the doctrine of ejusdem generis . Under this principle, “where general words follow the enumeration of particular classes of persons o r things, the general words will be construed as appl icable only to persons or things of the same general nature or class as those enumerated.” Noyes Supervision, Inc. v. Canadian Indem. Co. , 487 F. Supp. 433, 437 (D. Colo. 1980) (emphasis a dded). In this case, however, the general language (“any a nd all claims I might state”) precedes the specific language. Thus, the doctrine of ejusdem generis is inapposite. Lyman v. Town of Bow Mar , 533 P.2d 1129, 1133 (Colo. 1975) (rejecting the application of ejusdem generis where the general words at issue preceded the enumeration of specific examples). Mo reover, the term “include” is a term of “extension or enlargement,” rather than limitation. Id. Thus, in this-16-

case, as in Lyman , the general language controls and the specific la nguage merely provides examples. See id. In summary, the public interest in mountain biking is minimal, and the provision of trails and bicycles does not involve aduty to the public. The service provided is not a public necessity, and nothing ind icates that the agreement was entered into unfairly. The agreement is clear and unambiguous. Considering these factors, we conclude that the exculpatory agreementis enforceable as a matter of law. The district court was therefore correct in g ranting summary judgment to defendants.
D. California Law Kemper argues that the district court erred in not applying California law to its subrogation claim. We need not address the cho ice-of-law question, however, because we hold that the agreement is also enforcea ble under California law. The district court found that because Kemper’s rights are derivative of Mincin’s rights, granting summary judgment against Mincin necessarily entailed the granting of summary judgment against Kemper. K emper asserts that this is error because, under California law, “settlement be tween the employee and the third party has no impact on the carrier’s independent claim.” Bailey v. Reliance
Ins. Co. , 94 Cal. Rptr. 2d 149, 153 (Cal. Ct. App. 2000). This rule stems from section 3859 of the California Labor Code, which st ates: “No release or-17-

settlement of any claim . . . as to either the empl oyee or the employer is valid without the written consent of both.” C AL
. L AB
. C ODE § 3859(a). It is plain, however, that this language (“release or settlement of any claim ”) applies to settlements and releases obtained after an accident. In other words, an employer or an insurer that has paid an employee wo rker’s compensation has a subrogation right, based upon the employee’s right, to recover the amount paid; in such circumstances the employee may not settle a cl aim at the expense of the employer or the insurer. Bd. of Admin. v. Glover , 34 Cal. 3d 906, 913 (1983). Section 3859 is inapplicable in a situation such as the instant one, where the release was signed prior to the accident and before worker’s compensation was paid, because no subrogation right ever arose. The California Labor Code therefore does not grant Kemper subrogation rights independent of the rights asserted by Mincin. Rather, a subrogation right ha s the same character under California law as it has under Colorado law: The nature of subrogation and its prohibition again st double recovery make it abundantly clear that subrogation involves succession to the rights of others. Rights under subrogation are der ivative rights, and succession to another's rights, like water, cannot rise higher than its source. . . . In their own right [subrogees] posses s no claims of their own against the tortfeasor, for he has committed no wrong against them. Glover , 34 Cal. 3d at 915 (internal quotation marks and c itation omitted). Accordingly, the exculpatory clause bars Kemper’s s ubrogation claim, even under-18-

California law. We find no error on the part of th e district court. III. Conclusion For the foregoing reasons, the judgment of the district court is AFFIRMED.