Will this exculpatory clause or liability cap protect the drafter from its own conduct?
Not for the categories Civil Code § 1668 removes: all contracts having for their object, directly or indirectly, to exempt anyone from responsibility for their own FRAUD, WILLFUL INJURY to the person or property of another, or VIOLATION OF LAW, whether willful or negligent, are against the policy of the law. A CAP is treated like a release for this purpose: limitations on damages for willful injury to the person or property of another are invalid under § 1668 (New England Country Foods). That rule has a boundary the same opinion draws: § 1668 does not preclude parties from limiting their liability for pure breaches of contract absent a violation of an independent duty that falls within the ambit of § 1668, and where the claims asserted are nothing more than a breach of contractual obligations § 1668 does not apply, leaving the limitation to contract principles such as unconscionability (New England Country Foods). An agreement to exculpate a party for future violations of a statutory duty designed to protect public safety is against the policy of the law under § 1668 and unenforceable (Whitehead). Beyond those, an exculpatory provision in a contract affecting the PUBLIC INTEREST is invalid under § 1668 (Tunkl, holding a hospital-patient release invalid). Tunkl does not define the public interest by formula; it designates the characteristics of the transaction, some or all of which the invalid exemption exhibits: a business of a type generally thought suitable for public regulation; a party seeking exculpation engaged in performing a service of great importance to the public, often a matter of practical necessity for some members of the public; a party holding himself out as willing to perform that service for any member of the public who seeks it, or at least any member within certain established standards; a decisive advantage of bargaining strength arising from the essential nature of the service in the economic setting of the transaction; a standardized adhesion contract of exculpation with no provision whereby a purchaser may pay additional reasonable fees and obtain protection against negligence; and the person or property of the purchaser placed under the control of the seller, subject to the risk of carelessness by the seller or his agents. And an agreement made in the context of sports or recreational programs or services purporting to release liability for future GROSS NEGLIGENCE is generally unenforceable as a matter of public policy (City of Santa Barbara).
The trap
Three things drafters get wrong. First, a limitation-of-liability CAP is not safer than a release: New England Country Foods (2025) holds the cap invalid for willful injury exactly as a full release would be, so a cap that substantially limits damages for an intentional wrong, without exempting the party entirely, is invalid to that extent. The same opinion marks the boundary: for a pure breach of contract, absent a violation of an independent duty that falls within the ambit of § 1668, the section does not apply at all and the limitation is tested by contract principles such as unconscionability. Second, statutory duties: Whitehead (2025) held a release unenforceable to the extent it covered negligent violation of a statutory duty designed to protect public safety, reversing lower courts that had upheld it by applying only Tunkl's public-interest factors: the statutory duty, not the words of the release, decided it. Third, the public-interest doctrine is about the TRANSACTION: Tunkl invalidates a facially clear release because of what the relationship is.
12 authorities
- statuteCal. Civ. Code § 1668enactment date not established
The words that state the rule
All contracts which have for their object, directly or indirectly, to exempt any one from responsibility for his own fraud, or willful injury to the person or property of another, or violation of law, whether willful or negligent, are against the policy of the law.
- case60 Cal. 2d 92Tunkl v. Regents of the University of CaliforniaCal.decided 1963read it at the source ↗
The words that state the rule
For the reasons we hereinafter specify, we have concluded that an agreement between a hospital and an entering patient affects the public interest and that, in consequence, the exculpatory provision included within it must be invalid under Civil Code section 1668.
The words that state the rule
We conclude, consistent with dicta in California cases and with the vast majority of out-of-state cases and other authority, that an agreement made in the context of sports or recreational programs or services, purporting to release liability for future gross negligence, generally is unenforceable as a matter of public policy. Applying that general rule in the case now before us, we hold that the agreement, to the extent it purports to release liability for future gross negligence, violates public policy and is unenforceable.
- caseNo. S282968 (Cal. Apr. 24, 2025)New England Country Foods, LLC v. VanLaw Food Products, Inc.Cal.decided 2025
The words that state the rule
In light of the language and purpose of the statute, the policy discouraging willful tortious conduct, and the general agreement in case law that limits on liability and full releases are treated similarly, we hold that limitations on damages for willful injury to the person or property of another are invalid under section 1668.
- caseNo. S284303 (Cal. May 1, 2025)Whitehead v. City of OaklandCal.decided 2025
The words that state the rule
Consistent with our precedent (and with the law of other jurisdictions), we conclude that an agreement to exculpate a party for future violations of a statutory duty designed to protect public safety is against the policy of the law under Civil Code section 1668 and is not enforceable.
- caseNo. S284303 (Cal. May 1, 2025)Whitehead v. City of Oaklanddecided 2025
The words that state the rule
We conclude that such a release is “against the policy of the law” under Civil Code section 1668 (section 1668) to the extent it purports to relieve the City of liability for negligently violating a statutory duty relating to public safety. We therefore reverse the judgment of the Court of Appeal.
- caseNo. S284303 (Cal. May 1, 2025)Whitehead v. City of Oaklanddecided 2025
The words that state the rule
The case before us does not involve a claim for future ordinary or gross negligence under the common law. The complaint instead asserts a negligent violation of the City’s statutory duty (see Gov. Code, § 835 et seq.) to maintain its streets in a reasonably safe condition for travel by the public.
- caseNo. S282968 (Cal. Apr. 24, 2025)New England Country Foods, LLC v. VanLaw Food Products, Inc.decided 2025
The words that state the rule
The United States Court of Appeals for the Ninth Circuit asked us whether a contract clause that substantially limits damages for intentional wrongdoing is invalid under section 1668. We hold that a limitation on damages for willful injury to the person or property of another is invalid under section 1668.
- case60 Cal. 2d 92Tunkl v. Regents of the University of CaliforniaCal.decided 1963read it at the source ↗
The words that state the rule
No definition of the concept of public interest can be contained within the four corners of a formula. The concept, always the subject of great debate, has ranged over the whole course of the common law; rather than attempt to prescribe its nature, we can only designate the situations in which it has been applied. We can determine whether the instant contract does or does not manifest the characteristics which have been held to stamp a contract as one affected with a public interest. In placing particular contracts within or without the category of those affected with a public interest, the courts have revealed a rough outline of that type of transaction in which exculpatory provisions will be held invalid. Thus the 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. 9 The party seeking exculpation is engaged *99 in performing a service of great importance to the public, 10 which is often a matter of practical necessity for some members of the public. 11 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. 12 As a result of the essential nature of the *100 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. 13 In exercising a superior bargaining power the party confronts the public with a standardized adhesion contract of exculpation, 14 and makes no provision whereby a purchaser may pay additional reasonable fees and obtain protec *101 tion against negligence. 15 Finally, as a result of the transaction, the person or property of the purchaser is placed under the control of the seller, 16 subject to the risk of carelessness by the seller or his agents.
- caseNo. S282968 (Cal. Apr. 24, 2025)New England Country Foods, LLC v. VanLaw Food Products, Inc.Cal.decided 2025
The words that state the rule
Because NECF suggests that section 1668 applies not only to willful tortious conduct but also to willful breaches of contract, a further clarification is warranted: Section 1668 does not preclude parties from limiting their liability for pure breaches of contract absent a violation of an independent duty that falls within the ambit of section 1668. Where the claims asserted are “nothing more than a breach of . . . contractual obligations,” section 1668 does not apply. (Food Safety, supra, 209 Cal.App.4th at p. 1125.) In such cases, releases are governed by contract principles such as unconscionability.
- caseNo. S284303 (Cal. May 1, 2025)Whitehead v. City of OaklandCal.decided 2025
The words that state the rule
In assessing whether the release implicated the public interest, the trial court relied exclusively on the multifactor test we announced in Tunkl v. Regents of University of California (1963) 60 Cal.2d 92 (Tunkl), which evaluated the validity of a release of common law negligence claims. The Court of Appeal affirmed. (Whitehead v. City of Oakland (2024) 99 Cal.App.5th 775 (Whitehead).) Like the trial court, it relied exclusively on Tunkl and Court of Appeal decisions applying the Tunkl framework to other common law negligence claims.
- statuteCal. Civ. Code § 1667enactment date not established
The words that state the rule
That is not lawful which is: 1. Contrary to an express provision of law; 2. Contrary to the policy of express law, though not expressly prohibited; or, 3. Otherwise contrary to good morals.
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.