Bagley v. Mt. Bachelor, Inc. ( 2014 )


Menu:
  • No. 72	                   December 18, 2014	543
    
                  IN THE SUPREME COURT OF THE
                        STATE OF OREGON
    
                          Myles A. BAGLEY,
                             individually,
                         Petitioner on Review,
                                  and
                             Al BAGLEY,
                             individually;
                         and Lauren Bagley,
                             individually,
                               Plaintiffs,
                                   v.
                        MT. BACHELOR, INC.,
               dba Mt. Bachelor Ski and Summer Resort,
                        Respondent on Review,
                                  and
                           John DOES 1-10,
                              Defendants.
              (CC 08CV0118SF; CA A148231; SC S061821)
    
    
       En Banc
       On review from the Court of Appeals.*
       Argued and submitted May 7, 2014.
       Kathryn H. Clarke, Portland, argued the cause and filed
    the briefs for petitioner on review. With her on the briefs was
    Arthur C. Johnson.
       Andrew C. Balyeat, Balyeat & Eager, LLP, Bend, argued
    the cause and filed the brief for respondent on review.
       Michael J. Estok, Lindsay Hart, LLP, Portland, filed
    a brief on behalf of amicus curiae Oregon Association of
    Defense Counsel.
    ______________
    	  *  Appeal from Deschutes County Circuit Court, Stephen P. Forte, Judge. 258
    Or App 390, 310 P3d 692 (2013).
    544	                                        Bagley v. Mt. Bachelor, Inc.
    
      Kristian Roggendorf, Roggendorf Law LLC, Lake
    Oswego, filed a brief on behalf of amicus curiae Oregon Trial
    Lawyers Association.
        BREWER, J.
       The decision of the Court of Appeals is reversed. The judg-
    ment of the trial court is reversed, and the case is remanded
    to that court for further proceedings.
         Plaintiff brought a negligence action against defendant ski area operator
    for injuries he sustained while snowboarding over a jump in defendant’s terrain
    park. The trial court granted defendant’s summary judgment motion, agreeing
    with defendant that, prior to using defendant’s facilities, plaintiff had released
    defendant from future liability for his injuries, including those caused by defen-
    dant’s negligence, and rejecting plaintiff’s argument that enforcement of the
    release would violate public policy and would be unconscionable. The Court of
    Appeals affirmed. Held: (1) Enforcement of the release in this case would be both
    procedurally and substantively unconscionable because of the legally significant
    disparity in the parties’ bargaining power, the unfairly adhesive nature of the
    release, and the public interest that is affected by the performance of defendant’s
    private duties toward its patrons, given the large numbers of the general public
    using defendant’s facilities virtually without restriction and the degree to which
    the personal safety of defendant’s patrons is subject to the risk defendant’s care-
    lessness; and (2) those unconscionability considerations are not outweighed by
    defendant’s interest in enforcing the release, in light of the fact that defendant
    was in a better position than plaintiff to guard against risks created by its own
    conduct.
        The decision of the Court of Appeals is reversed. The judgment of the trial
    court is reversed, and the case is remanded to that court for further proceedings.
    Cite as 356 Or 543 (2014)	545
    
    	          BREWER, J.
    	         The issue on review in this case is whether an antic-
    ipatory release1 of a ski area operator’s liability for its own
    negligence in a ski pass agreement is enforceable in the face
    of an assertion that the release violates public policy and
    is unconscionable. Plaintiff suffered serious injuries while
    snowboarding over a jump in defendant ski area operator’s
    “terrain park,” and brought this action alleging that defen-
    dant was negligent in the design, construction, maintenance,
    and inspection of the jump. Defendant moved for summary
    judgment based on an affirmative defense of release; plain-
    tiff filed a cross-motion for partial summary judgment on
    the ground that the release was unenforceable as a matter
    of law. The trial court granted defendant’s summary judg-
    ment motion and denied plaintiff’s cross-motion. Plaintiff
    appealed, asserting, among other arguments, that the trial
    court erred in concluding that the release did not violate
    public policy and that it was neither substantively nor pro-
    cedurally unconscionable. The Court of Appeals affirmed.
    Bagley v. Mt. Bachelor, Inc., 258 Or App 390, 310 P3d 692
    (2013). Because we conclude that enforcement of the release
    would be unconscionable, we reverse and remand.
            FACTS AND PROCEDURAL BACKGROUND
    	         We review the trial court’s rulings on summary
    judgment to determine whether “there is no genuine issue
    as to any material fact” and whether “the moving party is
    entitled to prevail as a matter of law.” ORCP 47 C. We view
    the historical facts set out in the summary judgment record,
    along with all reasonable inferences that may be drawn from
    them, in the light most favorable to the nonmoving party—
    plaintiff on defendant’s motion for summary judgment, and
    defendant on plaintiff’s cross-motion. Id.; Vaughn v. First
    Transit, Inc., 346 Or 128, 132, 206 P3d 181 (2009). The
    historical facts in the record largely relate to the enforce-
    ability of the release at issue. Defendant’s summary judgment
    motion did not address the issues of negligence, causation, or
    damages. Therefore, insofar as those issues are relevant to
    	1
           By “anticipatory release,” we refer to an exculpatory agreement that pur-
    ports to immunize—before an injury occurs—the released party from liability for
    its own tortious conduct.
    546	                               Bagley v. Mt. Bachelor, Inc.
    
    the enforceability of the release, we accept as true the allega-
    tions in plaintiff’s complaint. ORCP 47 C (adverse party on
    summary judgment has burden of producing evidence only
    “on any issue raised in the motion as to which adverse party
    would have burden of persuasion at trial”).
    	        On September 29, 2005, plaintiff purchased a sea-
    son pass from defendant for use at defendant’s ski area.
    Plaintiff was a skilled and experienced snowboarder, hav-
    ing purchased season passes from defendant for each of the
    preceding three years and having classified his skill level as
    of early 2006, before being injured, as an “advanced expert.”
    Upon purchasing the season pass, plaintiff executed a writ-
    ten “release and indemnity agreement” that defendant
    required of all its patrons. That document provided, in per-
    tinent part:
       	 “In consideration of the use of a Mt. Bachelor pass and/or
       Mt. Bachelor’s premises, I/we agree to release and indem-
       nify Mt. Bachelor, Inc., its officers and directors, owners,
       agents, landowners, affiliated companies, and employees
       (hereinafter ‘Mt. Bachelor, Inc.’) from any and all claims
       for property damage, injury, or death which I/we may suf-
       fer or for which I/we may be liable to others, in any way
       connected with skiing, snowboarding, or snowriding. This
       release and indemnity agreement shall apply to any claim
       even if caused by negligence. The only claims not released
       are those based upon intentional misconduct.
       	   “* * * * *
       	 “The undersigned(s) have carefully read and under-
       stand this agreement and all of its terms on both sides
       of this document. This includes, but is not limited to, the
       duties of skiers, snowboarders, or snowriders. The under-
       signed(s) understand that this document is an agreement
       of release and indemnity which will prevent the under-
       signed(s) or the undersigneds’ estate from recovering dam-
       ages from Mt. Bachelor, Inc. in the event of death or injury
       to person or property. The undersigned(s), nevertheless,
       enter into this agreement freely and voluntarily and agree
       it is binding on the undersigned(s) and the undersigneds’
       heirs and legal representatives.
       	 “By my/our signature(s) below, I/we agree that this
       release and indemnity agreement will remain in full force
    Cite as 356 Or 543 (2014)	547
    
        and effect and I will be bound by its terms throughout this
        season and all subsequent seasons for which I/we renew
        this season pass.
        	 “See reverse side of this sheet * * * for duties of skiers,
        snowboarders, or snow riders which you must observe.”
    (Capitalization omitted.) 2 The reverse side of the document
    detailed the “Duties of Skiers” under ORS 30.985 and ORS
    30.990 and also included a printed notification that “Skiers/
    Snowboarders/Snowriders Assume Certain Risks” under
    ORS 30.975—the “inherent risks of skiing.”3
    	       On November 18, 2005, plaintiff began using the
    pass, which stated, in part:
        	   “Read this release agreement
        	 “In consideration for each lift ride, the ticket user
        releases and agrees to hold harmless and indemnify
        Mt. Bachelor, Inc., and its employees and agents from all
        claims for property damage, injury or death even if caused
        by negligence. The only claims not released are those based
        upon intentional misconduct.”
    (Capitalization omitted.) Further, the following sign was
    posted at each of defendant’s ski lift terminals:
        	   “YOUR TICKET IS A RELEASE
        	 “The back of your ticket contains a release of all claims
        against Mt. Bachelor, Inc. and its employees or agents.
    
    	2
           Although defendant relies on several documents that, it asserts, separately
    and collectively released it from liability for plaintiff’s injuries, for convenience we
    refer to those documents in the singular throughout this opinion as “the release.”
    In addition to the releases discussed in the text, plaintiff’s father also executed a
    “minor release and indemnity agreement” on plaintiff’s behalf, containing essen-
    tially the same terms as the other releases, because plaintiff was not yet eighteen
    years old when he bought the season pass. Plaintiff asserted before the trial court
    and the Court of Appeals that he was entitled to—and effectively did—disavow
    the release after he reached majority. For reasons explained in its opinion, the
    Court of Appeals affirmed the trial court’s rejection of that argument. Plaintiff
    did not seek review of that holding in this court and we do not address it here.
    	3
           As elaborated below, Oregon has enacted statutes specifically pertaining
    to skiing and ski areas. See ORS 30.970 - 30.990. Those statutes, among other
    provisions, set out the “duties” of skiers, require that ski area operators inform
    skiers of those duties, establish notice requirements and a statute of limitations
    pertaining specifically to injury or death while skiing, and provide that those
    who engage in the sport of skiing accept and assume the risks inherent in that
    activity.
    548	                                Bagley v. Mt. Bachelor, Inc.
    
       Read the back of your ticket before you ride any lifts or use
       any of the facilities of Mt. Bachelor, Inc. If you purchase
       a ticket from someone else, you must provide this ticket
       release information to that person or persons.
       	 “Skiers and lift passengers who use tickets at this
       resort release and agree to hold harmless and indemnify
       Mt. Bachelor, Inc., its employees and agents from all claims
       for property damage, injury or death which he/she may suf-
       fer or for which he/she may be liable to others, arising out
       of the use of Mt. Bachelor’s premises, whether such claims
       are for negligence or any other theory of recovery, except for
       intentional misconduct.
       	 “If you do not agree to be bound by the terms and con-
       ditions of the sale of your ticket, please do not purchase the
       ticket or use the facilities at Mt. Bachelor.
       	 “Presentation of this ticket to gain access to the prem-
       ises and facilities of this area is an acknowledgment of your
       agreement to the terms and conditions outlined above.”
    (Capitalization in original.)
    	        Beginning on November 18, 2005, plaintiff used
    his season pass to ride defendant’s lifts at least 119 times
    over the course of 26 days that he spent snowboarding at
    the ski area. On February 16, 2006, while snowboarding
    over a human-made jump in defendant’s “air chamber”
    terrain park, plaintiff sustained serious injuries resulting
    in his permanent paralysis. Approximately four months
    later, plaintiff provided defendant with notice of his inju-
    ries under ORS 30.980(1), which requires that “[a] ski area
    operator shall be notified of any injury to a skier * * * within
    180 days after the injury[.]” Within two years after he was
    injured, plaintiff brought this action; his complaint alleged
    negligence on defendant’s part in designing, constructing,
    maintaining, and inspecting the jump on which plaintiff
    was injured. Defendant answered, in part, by invoking the
    affirmative defense of release, pointing to the above-quoted
    documents.
    	       In its summary judgment motion, defendant
    asserted that plaintiff “admittedly understood that he [had]
    entered into a release agreement and was snowboarding
    under its terms on the date of [the] accident.” Defendant
    Cite as 356 Or 543 (2014)	549
    
    argued that the release conspicuously and unambiguously
    disclaimed its future liability for negligence, and that the
    release was neither unconscionable nor contrary to public
    policy under Oregon law, because “skiers and snowboarders
    voluntarily choose to ski and snowboard and ski resorts do
    not provide essential public services.” Thus, defendant rea-
    soned, there was no material issue of fact as to whether the
    release barred plaintiff’s action, and defendant was entitled
    to judgment as a matter of law.
    	         In his cross-motion for partial summary judgment,
    plaintiff asserted that the release was unenforceable because
    it was contrary to public policy and was “both substantively
    and procedurally unconscionable.” The trial court rejected
    plaintiff’s public policy and unconscionability arguments,
    reasoning that “[s]now riding is not such an essential ser-
    vice which requires someone such as [p]laintiff to be forced
    to sign a release in order to obtain the service.” Accordingly,
    the trial court granted summary judgment in defendant’s
    favor and denied plaintiff’s cross-motion for partial sum-
    mary judgment.
    	         As noted, the Court of Appeals affirmed. The court
    initially observed that the line between the public policy and
    unconscionability doctrines on which plaintiff relied was not
    clearly delineated:
       	 “We assume without deciding that the ‘void as contrary
       to public policy’ doctrine pertaining to this type of case has
       not been superseded by later-evolved principles concerning
       substantive unconscionability. See Restatement[ (Second)
       of Contracts], § 208 comment a [(1981)] (unconscionability
       analysis generally ‘overlaps’ with public-policy analysis).”
    Bagley, 258 Or App at 403 n 7. The court then proceeded sep-
    arately to analyze plaintiff’s arguments. It first concluded
    that the release did not violate public policy. In particu-
    lar, the court understood plaintiff to rely on an uncodified
    Oregon public policy that gives primacy to the tort duties of
    landowners and business operators to provide safe premises
    for invitees. In rejecting plaintiff’s argument, the Court of
    Appeals relied on several factors. First, the court observed
    that the release “clearly and unequivocally” expressed
    defendant’s intent to disclaim liability for negligence. Id. at
    550	                              Bagley v. Mt. Bachelor, Inc.
    
    405 (“[W]e are hard-pressed to envision a more unambigu-
    ous expression of ‘the expectations under the contract’[.]”).
    Second, the court noted that anticipatory releases that dis-
    claim liability only for ordinary negligence do not neces-
    sarily offend public policy where they pertain exclusively
    to recreational activities and, most importantly, where the
    party seeking to relieve itself from liability does not pro-
    vide an essential public service. Id. The court noted that a
    ski resort primarily offers recreational activities that, with
    possible exceptions that do not apply in this case, such as
    training for search-and-rescue personnel, do not constitute
    essential public services. Id. at 406. Third, the court stated
    that plaintiff’s claims were based on ordinary negligence
    and did not implicate a violation of any heightened duty of
    care. Id.
    
    	        The court then rejected plaintiff’s unconscionability
    argument for essentially the same reasons. First, the court
    concluded, the release was not procedurally unconscionable
    in that it did not surprise plaintiff (that is, it was conspicu-
    ous and unambiguous) and it was not impermissibly oppres-
    sive, because, even though offered on a “take it or leave it
    basis,” plaintiff always could choose not to engage in the
    non-essential recreational activity that defendant offered.
    Id. at 407-08. The court also concluded that the release was
    not essentially unfair and, therefore, was not substantively
    unconscionable. Id. at 409. Although “favorable” to defen-
    dant, the release was not impermissibly so, the court stated,
    because a person does not need to ski or snowboard, but
    rather merely desires to do so. That is, the patron is free to
    walk away rather than accept unjust terms. Id. at 409-10.
    For those reasons, the court affirmed the trial court’s
    summary judgment rulings and its dismissal of plaintiff’s
    action.
    
                             ANALYSIS
    
    	         The parties’ dispute in this case involves a topic—
    the validity of exculpatory agreements—that this court has
    not comprehensively addressed in decades. Although the spe-
    cific issue on review—the validity of an anticipatory release
    of a ski area operator’s liability for negligence—is finite and
    Cite as 356 Or 543 (2014)	551
    
    particular, it has broader implications insofar as it lies at
    the intersection of two traditional common law domains—
    contract and tort—where, at least in part, the legislature
    has established statutory rights and duties that affect the
    reach of otherwise governing common law principles.
    	        It is a truism that a contract validly made between
    competent parties is not to be set aside lightly. Bliss v.
    Southern Pacific Co. et al, 212 Or 634, 646, 321 P2d 324
    (1958) (“When two or more persons competent for that pur-
    pose, upon a sufficient consideration, voluntarily agree to
    do or not to do a particular thing which may be lawfully
    done or omitted, they should be held to the consequences
    of their bargain.”). The right to contract privately is part
    of the liberty of citizenship, and an important office of the
    courts is to enforce contractual rights and obligations. W. J.
    Seufert Land Co. v. Greenfield, 262 Or 83, 90-91, 496 P2d
    197 (1972) (so stating). As this court has stated, however,
    “contract rights are [not] absolute; * * * [e]qually fundamen-
    tal with the private right is that of the public to regulate it
    in the common interest.” Christian v. La Forge, 194 Or 450,
    469, 242 P2d 797 (1952) (internal quotation marks omitted).
    	        That “common,” or public, interest is embodied,
    in part, in the principles of tort law. As a leading treatise
    explains:
       “It is sometimes said that compensation for losses is the
       primary function of tort law * * * [but it] is perhaps more
       accurate to describe the primary function as one of deter-
       mining when compensation is to be required.
    
       “* * * * *
    
       “[Additionally, t]he ‘prophylactic’ factor of preventing
       future harm has been quite important in the field of torts.
       The courts are concerned not only with compensation of the
       victim, but with admonition of the wrongdoer.”
    
    W. Page Keeton, Prosser and Keeton on the Law of Torts § 4,
    20-25 (5th ed 1984). See also Dan B. Dobbs, The Law of
    Torts, § 8, 12 (2000) (most commonly mentioned aims of tort
    law are compensation of injured persons and deterrence of
    undesirable behavior). A related function of the tort system
    552	                                      Bagley v. Mt. Bachelor, Inc.
    
    is to distribute the risk of injury to or among responsible
    parties. Prosser and Keeton, § 4, 24-25.4
    	        One way in which courts have placed limits on the
    freedom of contract is by refusing to enforce agreements
    that are illegal. Uhlmann v. Kin Daw, 97 Or 681, 688, 
    193 P. 435
     (1920) (an illegal agreement is void and unenforce-
    able). According to Uhlmann:
       “An agreement is illegal if it is contrary to law, morality
       or public policy. Plain examples of illegality are found in
       agreements made in violation of some statute; and, stat-
       ing the rule broadly, an agreement is illegal if it violates a
       statute or cannot be performed without violating a statute.”
    Id. at 689 (internal citation omitted); see also Eldridge et al.
    v. Johnston, 195 Or 379, 405, 245 P2d 239 (1952) (“It is
    elementary that public policy requires that * * * contracts
    [between competent parties], when entered into freely and
    voluntarily, shall be held sacred and shall be enforced by the
    courts of justice, and it is only when some other overpow-
    ering rule of public policy * * * intervenes, rendering such
    agreement illegal, that it will not be enforced.”).
    	        In determining whether an agreement is illegal
    because it is contrary to public policy, “[t]he test is the evil
    tendency of the contract and not its actual injury to the public
    in a particular instance.” Pyle v. Kernan, 148 Or 666, 673-74,
    36 P2d 580 (1934). The fact that the effect of a contract
    provision may be harsh as applied to one of the contracting
    parties does not mean that the agreement is, for that rea-
    son alone, contrary to public policy, particularly where “the
    contract in question was freely entered into between parties
    in equal bargaining positions and did not involve a contract
    of adhesion, such as some retail installment contracts and
    insurance policies.” Seufert, 262 Or at 92.
    	        As we discuss in more detail below, courts deter-
    mine whether a contract is illegal by determining whether it
    violates public policy as expressed in relevant constitutional
    and statutory provisions and in case law, see, e.g., Delaney v.
    	4
           See also Rizutto v. Davidson Ladders, Inc., 280 Conn 225, 235, 905 A2d
    1165 (2006) (fundamental purposes of the tort system are “compensation of inno-
    cent parties, shifting the loss to responsible parties or distributing it among
    appropriate entities, and deterrence of wrongful conduct.”).
    Cite as 356 Or 543 (2014)	553
    
    Taco Time Int’l, Inc., 297 Or 10, 681 P2d 114 (1984) (looking
    to those sources to determine whether discharge of at-will
    employee violated public policy), and by considering whether
    it is unconscionable. With respect to the doctrine of uncon-
    scionability, one commentator has explained:
        “The concept of unconscionability was meant to counteract
        two generic forms of abuses: the first of which relates to pro-
        cedural deficiencies in the contract formation process, such
        as deception or a refusal to bargain over contract terms,
        today often analyzed in terms of whether the imposed-
        upon party had meaningful choice about whether and how
        to enter the transaction; and the second of which relates
        to the substantive contract terms themselves and whether
        those terms are unreasonably favorable to the more pow-
        erful party, such as terms that impair the integrity of the
        bargaining process or otherwise contravene the public
        interest or public policy; terms (usually of an adhesion or
        boilerplate nature) that attempt to alter in an impermissi-
        ble manner fundamental duties otherwise imposed by the
        law, fine-print terms, or provisions that seek to negate the
        reasonable expectations of the nondrafting party, or unrea-
        sonably and unexpectedly harsh terms having nothing to
        do with price or other central aspects of the transaction.”
    Richard A. Lord, 8 Williston on Contracts § 18.10, 91
    (4th ed 2010). As that passage suggests, the doctrine of
    unconscionability reflects concerns related specifically to
    the parties and their formation of the contract, but it also
    has a broader dimension that converges with an analysis
    of whether a contract or contract term is illegal because it
    violates public policy.5
    
    	5
           This court has not distinguished between contracts that are illegal because
    they violate public policy and contracts that are unenforceable because they are
    unconscionable. However, a difference in focus between the two concepts has been
    described in this way:
        “[O]ur public policy analysis asks whether the contract provision at issue
        threatens harm to the public as a whole, including by contravening the con-
        stitution, statutes, or judicial decisions of [this state]. In contrast, an uncon-
        scionability analysis asks whether the agreement, by its formation or by its
        terms, is so unfair that the court cannot enforce it consistent with the inter-
        ests of justice.”
    Phoenix Ins. Co. v. Rosen, 242 Ill 2d 48, 61, 949 NE2d 639 (2011). As that passage
    suggests, the two doctrines are aimed at similar concerns: unfairness or oppres-
    sion in contract formation or terms that are sufficiently serious as to justify the
    conclusion that the contract contravenes the interests of justice.
    554	                                         Bagley v. Mt. Bachelor, Inc.
    
    	        Recognizing that convergence, this court often has
    relied on public policy considerations to determine whether a
    contract or contract term is sufficiently unfair or oppressive
    to be deemed unconscionable. See, e.g., William C. Cornitius,
    Inc. v. Wheeler, 276 Or 747, 754-55, 556 P2d 666 (1976) (treat-
    ing lessee’s unconscionability defense as grounded in public
    policy); Cone v. Gilmore, 79 Or 349, 352-54, 
    155 P. 192
     (1916)
    (analyzing unconscionability challenge to contract enforce-
    ment based on public policy considerations); Balfour v. Davis
    14 Or 47, 53, 
    12 P. 89
     (1886) (referring to unconscionability
    interchangeably with public policy considerations). Other
    authorities also have described the two doctrines in func-
    tionally the same terms, see, e.g., E. Allen Farnsworth, 1
    Farnsworth on Contracts, § 4.28, 577 (3d ed 2004) (com-
    paring unconscionability to violation of public policy), or
    as involving substantially overlapping considerations, see
    Restatement (Second) of Contracts § 208 comment a (1981)
    (policy against unconscionable contracts or contract terms
    “overlaps with rules which render particular bargains or
    terms unenforceable on grounds of public policy”).
    	        As discussed, the Court of Appeals concluded that
    the release at issue here did not violate public policy and
    was not unconscionable for essentially the same reasons: it
    was conspicuous and unambiguous, and it related to a rec-
    reational activity, not an essential public service. Likewise,
    neither party has suggested that different legal standards
    apply in determining whether the release at issue in this case
    violates public policy or is unconscionable. Thus, for the sake
    of convenience—if not doctrinal convergence—we address
    the parties’ public policy arguments in the context of our
    analysis of whether, in the particular circumstances of this
    case, enforcement of the release would be unconscionable.6
    	       Oregon courts have recognized their authority to
    refuse to enforce unconscionable contracts since the nine-
    teenth century. See Balfour, 14 Or 47 (refusing to award
    
    	6
           We emphasize that it is not necessary to decide in this case whether the doc-
    trines always are identical in practical effect or whether they may vary in their
    application depending on the particular circumstances of a given case. It suffices
    to say that we discern no difference in their practical application in this case and,
    therefore, for the sake of convenience, we consider plaintiff’s violation of public
    policy theory in the context of his unconscionability arguments.
    Cite as 356 Or 543 (2014)	555
    
    attorney fees because amount specified in contract was
    unconscionable); see also Caples v. Steel, 7 Or 491 (1879)
    (court may refuse specific performance if bargain is uncon-
    scionable). Unconscionability is “assessed as of the time
    of contract formation,” and the doctrine “applies to con-
    tract terms rather than to contract performance.” Best v.
    U.S. National Bank, 303 Or 557, 560, 739 P2d 554 (1987)
    (“Unconscionability is a legal issue that must be assessed as
    of the time of contract formation.”); Tolbert v. First National
    Bank, 312 Or 485, 492 n 4, 823 P2d 965 (1991) (same).
    	        Unconscionability may be procedural or substan-
    tive. Procedural unconscionability refers to the conditions
    of contract formation and focuses on two factors: oppression
    and surprise. See, e.g., John Edward Murray, Jr., Murray
    on Contracts § 96(b), 555-56 (4th ed 2001) (describing
    components of procedural unconscionability). Oppression
    exists when there is inequality in bargaining power between
    the parties, resulting in no real opportunity to negotiate the
    terms of the contract and the absence of meaningful choice.
    Vasquez-Lopez v. Beneficial Oregon, Inc., 210 Or App 553,
    566-567, 152 P3d 940, 948 (2007); Acorn v. Household Intern.
    Inc., 211 F Supp 2d 1160, 1168 (ND Cal. 2002). Surprise
    involves whether terms were hidden or obscure from the
    vantage of the party seeking to avoid them. Id. Generally
    speaking, factors such as ambiguous contract wording and
    fine print are the hallmarks of surprise. In contrast, the
    existence of gross inequality of bargaining power, a take-
    it-or-leave-it bargaining stance, and the fact that a contract
    involves a consumer transaction, rather than a commercial
    bargain, can be evidence of oppression.
    	       Substantive unconscionability, on the other hand,
    generally refers to the terms of the contract, rather than
    the circumstances of formation, and focuses on whether
    the substantive terms contravene the public interest or
    public policy.7 See Restatement § 208 comment a; Williston
    
    	7
           It sometimes can be difficult to categorize the factors on which a determi-
    nation of unconscionability may be based as distinctly procedural or substantive,
    and even factors usually considered in assessing procedural unconscionability
    can help establish a violation of public policy. For example, the passage quoted
    above from Williston on Contracts § 18.10, 356 Or at ___ suggests that adhesive
    and fine-print terms may be substantively unconscionable. Indeed, the author
    556	                                          Bagley v. Mt. Bachelor, Inc.
    
    on Contracts § 18.10 at 91. Both procedural and substantive
    deficiencies—frequently in combination—can preclude enforce-
    ment of a contract or contract term on unconscionability
    grounds. Restatement § 208 comment a.8
    	         Identifying whether a contract is procedurally
    unconscionable requires consideration of evidence related
    to the specific circumstances surrounding the formation of
    the contract at issue. By contrast, the inquiry into substan-
    tive unconscionability can be more complicated. To discern
    whether, in the context of a particular transaction, substan-
    tive concerns relating to unfairness or oppression are suffi-
    ciently important to warrant interference with the parties’
    freedom to contract as they see fit, courts frequently look to
    legislation for relevant indicia of public policy. When rele-
    vant public policy is expressed in a statute, the issue is one
    of legislative intent. See Uhlmann, 97 Or at 689-90 (so stat-
    ing). In that situation, the court must examine the statu-
    tory text and context to determine whether the legislature
    intended to invalidate the contract term at issue.9 Id.
    goes on to say that “[t]he distinction between procedural and substantive abuses
    * * * may become quite blurred.” Williston on Contracts § 18.10 at 108-111.
    	8
           In some jurisdictions, courts require both procedural and substantive
    unconscionability before they will invalidate a contract. See, e.g., Armendariz v.
    Found. Health Psychcare Servs., Inc., 24 Cal 4th 83, 114, 99 Cal Rptr 2d 745, 6 P3d
    669, 690 (2000) (procedural and substantive unconscionability must both be pres-
    ent in order for a court to exercise its discretion to refuse to enforce a contract or
    clause under the doctrine of unconscionability); Blue Cross Blue Shield of Ala. v.
    Rigas, 923 So 2d 1077, 1087 (Ala 2005) (“To avoid an arbitration provision on the
    ground of unconscionability, the party objecting to arbitration must show both
    procedural and substantive unconscionability.”). This court has not addressed
    that issue, and because, as explained below, we conclude that both procedural
    and substantive considerations support the conclusion that the release here is
    unconscionable, we do not decide that issue in this case.
    	9
           Many jurisdictions that limit or prohibit the use of anticipatory releases
    from negligence liability on public policy grounds do so as a matter of statutory
    enactment, rather than common law. For example, Great Britain and the States
    of Louisiana and Montana have statutory provisions that forbid contracts excul-
    pating one party from liability for negligence that results in personal injury.
    Unfair Contract Terms Act of 1977, ch 50, § 2(1) (Eng) (“A person cannot by refer-
    ence to any contract term or to a notice given to persons generally or to particular
    persons exclude or restrict his liability for death or personal injury resulting from
    negligence.”); La Civ Code Ann art 2004 (“Any clause is null that, in advance,
    excludes or limits the liability of one party for causing physical injury to the other
    party.”); Mont Code Ann § 28-2-702 (“All contracts that have for their object,
    directly or indirectly, to exempt anyone from responsibility * * * for violation of
    law, whether willful or negligent, are against the policy of the law.”); see also
    Miller v. Fallon County, 
    222 Mont. 214
    , 221, 721 P2d 342 (1986) (under statute,
    Cite as 356 Or 543 (2014)	557
    
    	        Frequently, however, the argument that a contract
    term is sufficiently unfair or oppressive as to be unenforce-
    able is grounded in one or more factors that are not expressly
    codified; in such circumstances, the common law has a sig-
    nificant role to play. As the commentary to the Restatement
    (Second) of Contracts explains:
        “Only infrequently does legislation, on grounds of public
        policy, provide that a term is unenforceable. When a court
    prospective release from liability for negligence is against the policy of the law
    and illegal, despite being a private contract between two persons without signifi-
    cant public implications).
    		         Some states use statutes to make anticipatory releases from liability for
    negligence void as against public policy as to businesses providing recreational
    activities to the public. NY Gen Oblig Law § 5-326 (every contract between rec-
    reational business owner and user of facility, pursuant to which owner receives
    payment for use of facilities, that exempts owner from liability for damages
    resulting from owner’s negligence “shall be deemed void as against public policy
    and wholly unenforceable”); Haw Rev Stat § 663-1.54(a) (“Any person who owns
    or operates a business providing recreational activities to the public * * * shall be
    liable for damages resulting from negligent acts or omissions of the person which
    cause injury.”).
    		         Other states have enacted more narrowly crafted statutes that deal
    with specific recreational activities, including skiing. For example, an Alaska
    statute specifically prohibits ski area operators from requiring skiers to enter
    into agreements releasing them from liability in exchange for the use of the facili-
    ties. Alaska Stat Ann § 05.45.120. In North Carolina, a statute imposes a duty on
    ski area operators “[n]ot to engage willfully or negligently in any type of conduct
    that contributes to or causes injury to another person or his properties.” NC Gen
    Stat § 99C-2(c)(7); NC Gen Statute § 9C-3 (violation of duties of ski area operator
    that causes injury or damage shall constitute negligence); see also Strawbridge v.
    Sugar Mountain Resort, Inc., 320 F Supp 2d 425, 433 (WD NC 2004) (in light of
    statutory duty imposed on ski area operators not to negligently engage in conduct
    that causes injury, exculpatory clause on back of lift ticket was unenforceable).
    		         Still other states have statutes that pertain specifically to skiing and,
    although not addressing releases, prescribe ski area operator duties and provide
    that operators will be liable for a violation of those duties. Colo Rev Stat § 33-44-
    104(1) (violation of duties of ski area operator constitutes negligence to extent
    such violation causes injury to any person or damage to property); see also
    Anderson v. Vail Corp., 251 P3d 1125, 1129-30 (Colo App 2010) (if ski area oper-
    ator violated statutory duties, exculpatory agreement would not release operator
    from liability); Idaho Code § 6-1107 (“Any ski area operator shall be liable for loss
    or damages caused by its failure to follow the duties set forth in [other sections of
    the Idaho Code pertaining to duties of ski area operators], where the violation of
    duty is causally related to the loss or damage suffered.”); NM Stat Ann § 24-15-11
    (to same effect); ND Cent Code § 53-09-07 (same); W Va Code § 20-3A-6 (same);
    Utah Code Ann § 78B–4–401(public policy of Utah Inherent Risks of Skiing Act
    is to make ski area operators better able to insure themselves against the risk
    of loss occasioned by their negligence); see also Rothstein v. Snowbird Corp., 175
    P3d 560, 564 (Utah 2007) (by extracting a pre-injury release from plaintiff for lia-
    bility due to ski resort’s negligent acts, resort breached public policy underlying
    Utah Inherent Risks of Skiing Act).
    558	                                Bagley v. Mt. Bachelor, Inc.
    
       reaches that conclusion, it usually does so on the basis of a
       public policy derived either from its own perception of the
       need to protect some aspect of the public welfare or from
       legislation that is relevant to the policy although it says
       nothing explicitly about enforceability.”
    
    Restatement § 178 comment b.
    	        This court has considered whether enforcement of
    an anticipatory release would violate an uncodified public
    policy in only a few cases. Although, in those cases, this
    court has not expressly analyzed the issue through the lens
    of unconscionability, it has followed an approach that is
    generally consistent with the application of that doctrine.
    That is, the court has not declared such releases to be per
    se invalid, but neither has it concluded that they are always
    enforceable. Instead, the court has followed a multi-factor
    approach:
       	 “Agreements to exonerate a party from liability or to
       limit the extent of the party’s liability for tortious conduct
       are not favorites of the courts but neither are they automat-
       ically voided. The treatment courts accord such agreements
       depends upon the subject and terms of the agreement and
       the relationship of the parties.”
    
    K-Lines v. Roberts Motor Co., 273 Or 242, 248, 541 P2d 1378
    (1975).
    	In K-Lines, this court upheld a limitation of liability
    contained in a commercial sales agreement. The court held
    that the fact
       “[t]hat one party may possess greater financial resources
       than the other is not proof that such a disparity of bar-
       gaining power exists that a limitation of liability provisions
       should be voided.
       	 “When the parties are business concerns dealing in
       a commercial setting and entering into an unambiguous
       agreement with terms commonly used in commercial trans-
       actions, the contract will not be deemed a contract of adhe-
       sion in the absence of evidence of unusual circumstances.”
    
    Id. at 252-53. The court also noted that, in an earlier deci-
    sion, it had stated:
    Cite as 356 Or 543 (2014)	559
    
        “ ‘There is nothing inherently bad about a contract provi-
        sion which exempts one of the parties from liability. The
        parties are free to contract as they please, unless to permit
        them to do so would contravene the public interest.’ ”
    Id. at 248 (quoting Irish & Swartz Stores v. First Nat’l Bk.,
    220 Or 362, 375, 349 P2d 814 (1960), overruled on other
    grounds by Real Good Food v First National Bank, 276 Or
    1057, 557 P2d 654 (1976)).10
    	       Soon after deciding K-Lines, this court, in Real
    Good Food, held that a bank—serving as a bailee for depos-
    itors—could not limit its liability for the negligence of its
    employees. Relying on the Restatement (Second) of Torts, the
    court held:
        “Where the defendant is a common carrier, an innkeeper,
        a public warehouseman, a public utility, or is otherwise
        charged with a duty of public service, and the agreement
        to assume the risk relates to the defendant’s performance
        of any part of that duty, it is well settled that it will not
        be given effect. Having undertaken the duty to the pub-
        lic, which includes the obligation of reasonable care, such
        defendants are not free to rid themselves of their public
        obligation by contract, or by any other agreement.”
    Id. at 1061 (quoting Restatement (Second) of Torts § 496B
    comment g (1965)).11 The court in Real Good Food concluded
    	10
           In K-Lines, which, as noted, involved a commercial transaction, the
    court distinguished between releases from liability for ordinary negligence and
    releases involving more serious misconduct, concluding that the latter violate
    public policy, but that the former are not necessarily unenforceable. K-Lines, 273
    Or at 249.
    	11
            Restatement (Second)of Torts § 496B provides:
         “A plaintiff who by contract or otherwise expressly agrees to accept a risk
         of harm arising from the defendant’s negligent or reckless conduct cannot
         recover for such harm, unless the agreement is invalid as contrary to public
         policy.”
    		         According to the comments to that section, an exculpatory agreement
    should be upheld if it is freely and fairly made, if it is between parties who are
    in an equal bargaining position, and if there is no societal interest with which
    it interferes. Restatement (Second) of Torts § 496B comment b. Comments e-j set
    out a non-exclusive list of situations in which releases may interfere with socie-
    tal interests, insofar as they are contrary to public policy. Among other things,
    in addition to situations like those described in the passage quoted above, the
    Restatement refuses to give effect to express liability releases where there is a
    substantial disparity in bargaining power. Restatement (Second) of Torts § 496B
    comment j.
    560	                                       Bagley v. Mt. Bachelor, Inc.
    
    that “[b]anks, like common carriers and utility companies,
    perform an important public service,” and the release there-
    fore violated public policy and was unenforceable. 276 Or at
    1061.
    	        Finally, this court has held that another factor for
    determining whether an anticipatory release may be unen-
    forceable is the possibility of a harsh or inequitable result
    for the releasing party. Commerce & Industry Ins. v. Orth,
    254 Or 226, 231-32, 458 P2d 926 (1969) (so stating); Estey
    v. MacKenzie Engineering Inc., 324 Or 372, 376-77, 927 P2d
    86 (1996) (court’s inquiry into intent of parties to immunize
    against negligence “focuse[s] not only on the language of the
    contract, but also on the possibility of a harsh or inequitable
    result that would fall on one party by immunizing the other
    party from the consequences of his or her own negligence”).
    	        We glean from those decisions that relevant proce-
    dural factors in the determination of whether enforcement
    of an anticipatory release would violate public policy or be
    unconscionable include whether the release was conspicuous
    and unambiguous; whether there was a substantial dispar-
    ity in the parties’ bargaining power; whether the contract
    was offered on a take-it-or-leave-it basis; and whether the
    contract involved a consumer transaction. Relevant sub-
    stantive considerations include whether enforcement of the
    release would cause a harsh or inequitable result to befall
    the releasing party; whether the releasee serves an import-
    ant public interest or function; and whether the release pur-
    ported to disclaim liability for more serious misconduct than
    ordinary negligence. Nothing in our previous decisions sug-
    gests that any single factor takes precedence over the others
    or that the listed factors are exclusive. Rather, they indicate
    that a determination whether enforcement of an anticipa-
    tory release would violate public policy or be unconscionable
    must be based on the totality of the circumstances of a par-
    ticular transaction. The analysis in that regard is guided,
    but not limited, by the factors that this court previously has
    identified; it is also informed by any other considerations
    that may be relevant, including societal expectations.12
    
    	12
           Justice Peterson eloquently described the role of societal expectations in
    informing the development of both the common law and legislation:
    Cite as 356 Or 543 (2014)	561
    
    	         With those principles in mind, we first consider the
    factors that usually are described as procedural, viz., those
    pertaining to the formation of the agreement. Plaintiff does
    not contend that the release was inconspicuous or ambigu-
    ous; that is, plaintiff does not contend that he was surprised
    by its terms. Thus, that factor weighs in favor of enforcement.
    	         Other procedural factors, however, point in a differ-
    ent direction. This was not an agreement between equals.
    Only one party to the contract—defendant—was a commer-
    cial enterprise, and that party exercised its superior bar-
    gaining strength by requiring its patrons, including plain-
    tiff, to sign an anticipatory release on a take-it-or-leave-it
    basis as a condition of using its facilities. As the Restatement
    (Second) of Torts, section 496B, explains, a release may not
    be enforced
        “where there is such a disparity in bargaining power
        between the parties that the agreement does not represent
        a free choice on the part of the plaintiff. The basis for such
    
        	    “The beauty and strength of the common-law system is its infinite adapt-
        ability to societal change. Recent decisions of this court are illustrative. In
        Heino v. Harper, 306 Or 347, 349-50, 759 P2d 253 (1988), the court abolished
        interspousal immunity, holding ‘that the common-law rule of interspousal
        immunity is no longer available in this state to bar negligence actions
        between spouses.’ In Winn v. Gilroy, 296 Or 718, 734, 681 P2d 776 (1984), the
        court abolished parental tort immunity for negligent injury to minor chil-
        dren. Nineteen years earlier, in Wights v. Staff Jennings, 241 Or 301, 310, 405
        P2d 624 (1965), stating that ‘it is the function of the judiciary to modify the
        law of torts to fit the changing needs of society,’ the court held that a seller
        of a product may be held strictly liable for injuries to a plaintiff not in privity
        with the seller.
        	    “The development of the common law occurs in an environment in which
        tensions abound. On occasion, the Legislative Assembly passes laws in
        response to decisions of this court. Products liability decisions of this court
        led to the enactment of a series of products liability statutes now found in
        ORS 30.900 to 30.927. A decision of this court involving an injury to a skier,
        Blair v. Mt. Hood Meadows Development Corp., 291 Or 293, 630 P2d 827,
        modified, 291 Or 703, 634 P2d 241 (1981), led to the enactment of statutes
        concerning skiing activities, ORS 30.970 to 30.990.
        	    “On the other hand, this court, in deciding common-law issues presented
        to it, has ascertained public policy by looking to legislative enactments. The
        legislature is incapable of passing laws that govern every conceivable sit-
        uation that might arise, however. The common-law court is the institution
        charged with the formulation and application of rules of governing law in
        situations not covered by constitution, legislation, or rules.”
    Buchler v. Oregon Corrections Div., 316 Or 499, 518-19, 853 P2d 798 (1993)
    (Peterson, J., concurring).
    562	                                         Bagley v. Mt. Bachelor, Inc.
    
        a result is the policy of the law which relieves the party
        who is at such a disadvantage from harsh, inequitable, and
        unfair contracts which he is forced to accept by the neces-
        sities of his situation. The disparity in bargaining power
        may arise from the defendant’s monopoly of a particular
        field of service, from the generality of use of contract clauses
        insisting upon assumption of risk by those engaged in such
        a field, so that the plaintiff has no alternative possibility of
        obtaining the service without the clause; or it may arise from
        the exigencies of the needs of the plaintiff himself, which
        leave him no reasonable alternative to the acceptance of
        the offered terms.”
    Id. comment j (emphasis added).
    	        Also, plaintiff had no opportunity in this case to
    negotiate for different terms or pay an additional fee for
    protection against defendant’s negligence. What makes the
    substantial disparity in the parties’ bargaining positions
    even more significant in this circumstance is the limited
    number of ski areas that provide downhill skiing and snow-
    boarding opportunities in Oregon, and the generality of
    the use of similar releases among that limited commercial
    cohort.13 Simply put, plaintiff had no meaningful alternative
    to defendant’s take-it-or-leave-it terms if he wanted to par-
    ticipate in downhill snowboarding. Although that factor is
    not, by itself, dispositive,
        “[w]hen one party is in such a superior bargaining position
        that it totally dictates all terms of the contract and the only
        option presented to the other party is to take it or leave
        it, some quantum of procedural unconscionability is estab-
        lished. The party who drafts such a contract of adhesion
        bears the responsibility of assuring that the provisions of
        the contract are not so one-sided as to be unconscionable.”
    Strand v. U.S. Bank Nat. Ass’n, 693 NW2d 918, 925 (ND
    2005).
    	        We next consider the substantive factors that are rel-
    evant to our inquiry. The parties have identified the following
    relevant factors: whether enforcement of the release would
    cause a harsh or inequitable result; whether defendant’s
    	13
            In an excerpt from the transcript of plaintiff’s deposition that was included
    in the summary judgment record, plaintiff testified that he had never been to a
    ski resort where a release such as the one at issue here was not required.
    Cite as 356 Or 543 (2014)	563
    
    recreational business operation serves an important public
    interest or function; and whether the release purported to
    disclaim liability for more serious misconduct than ordinary
    negligence.
    	        We begin with the question whether enforcement
    of the release would cause a harsh and inequitable result
    to befall the releasing party, in this case, plaintiff. As dis-
    cussed, this court has recognized the importance of that
    consideration in other cases. See, e.g., Estey, 324 Or at 376.
    As pertinent here, we conclude that the result would be
    harsh because, accepting as true the allegations in plain-
    tiff’s complaint, plaintiff would not have been injured if
    defendant had exercised reasonable care in designing, con-
    structing, maintaining, or inspecting the jump on which he
    was injured. And that harsh result also would be inequita-
    ble because defendant, not its patrons, has the expertise and
    opportunity to foresee and control hazards of its own cre-
    ation on its premises, and to guard against the negligence
    of its employees. Moreover, defendant alone can effectively
    spread the cost of guarding and insuring against such risks
    among its many patrons.
    	        Those public policy considerations are embodied
    in the common law of business premises liability. Business
    owners and operators have a heightened duty of care toward
    patrons—invitees14 —with respect to the condition of their
    premises that exceeds the general duty of care to avoid
    unreasonable risks of harm to others. Hagler v. Coastal
    Farm Holdings, Inc., 354 Or 132, 140-41, 309 P3d 1073
    (2013); Garrison v. Deschutes County, 334 Or 264, 272, 48
    P3d 807 (2002) (business invitee rule is a “special duty”). As
    this court explained in Woolston v. Wells, 297 Or 548, 557-
    58, 687 P2d 144 (1984):
        “In general, it is the duty of the possessor of land to make
        the premises reasonably safe for the invitee’s visit. The pos-
        sessor must exercise the standard of care above stated to
        discover conditions of the premises that create an unrea-
        sonable risk of harm to the invitee. The possessor must
    	14
            An “invitee” is “[a] person who has an express or implied invitation to enter
    or use another’s premises, such as a business visitor or a member of the public to
    whom the premises are held open.” Bryan A Garner, Black’s Law Dictionary 846
    (8th ed 1999).
    564	                                Bagley v. Mt. Bachelor, Inc.
    
       exercise that standard of care either to eliminate the con-
       dition creating that risk or to warn any foreseeable invitee
       of the risk so as to enable the invitee to avoid the harm.”
    Furthermore, a business operator’s obligation to make its
    premises reasonably safe for its invitees includes taking
    into account the use to which the premises are put. See,
    e.g., Ragnone v. Portland School Dist. No. 1J, 291 Or 617,
    621 n 3, 633 P2d 1287 (1981) (so stating); Mickel v. Haines
    Enterprises, Inc., 240 Or 369, 371-72, 400 P2d 518 (1965)
    (owner must “take reasonable precautions to protect the invi-
    tee from dangers which are foreseeable from the arrange-
    ment or use of the premises.”).
    	       The legislature has statutorily modified those duties
    to some extent in the Skier Responsibility Law, ORS 30.970
    to 30.990. Under ORS 30.975, skiers assume certain risks:
       “In accordance with ORS 31.600 [pertaining to contrib-
       utory negligence] and notwithstanding ORS 31.620 (2)
       [abolishing the doctrine of implied assumption of risk], an
       individual who engages in the sport of skiing, alpine or nor-
       dic, accepts and assumes the inherent risks of skiing inso-
       far as they are reasonably obvious, expected or necessary.”
    ORS 30.970(1) describes “inherent risks of skiing”:
       “ ‘Inherent risks of skiing’ includes, but is not limited to,
       those dangers or conditions which are an integral part of
       the sport, such as changing weather conditions, variations
       or steepness in terrain, snow or ice conditions, surface or
       subsurface conditions, bare spots, creeks and gullies, forest
       growth, rocks, stumps, lift towers and other structures and
       their components, collisions with other skiers and a skier’s
       failure to ski within the skier’s own ability.”
    ORS 30.985 prescribes the duties of skiers, which generally
    deal with behaving safely while skiing.
    	        By providing that a skier assumes the “inherent
    risks of skiing,” ORS 30.975 reduced ski area operators’
    heightened common law duty to discover and guard against
    certain natural and inherent risks of harm. However, the
    Skier Responsibility Law did not abrogate the common-law
    principle that skiers do not assume responsibility for unrea-
    sonable conditions created by a ski area operator insofar as
    Cite as 356 Or 543 (2014)	565
    
    those conditions are not inherent to the activity. See Nolan
    v. Mt. Bachelor, Inc., 317 Or 328, 336, 856 P2d 305 (1993)
    (Skier Responsibility Law provides that “[t]o the extent an
    injury is caused by an inherent risk of skiing, a skier will
    not recover against a ski area operator; to the extent an
    injury is a result of [ski area operator] negligence, compar-
    ative negligence applies”). It follows that the public policy
    underlying the common-law duty of a ski area operator to
    exercise reasonable care to avoid creating risks of harm to
    its business invitees remains applicable in this case.
    	        In short, because (1) accepting as true the allega-
    tions in plaintiff’s complaint, plaintiff would not have been
    injured if defendant had exercised reasonable care in design-
    ing, constructing, maintaining, or inspecting the jump on
    which he was injured; and (2) defendant, not its patrons,
    had the expertise and opportunity—indeed, the common-
    law duty—to foresee and avoid unreasonable risks of its
    own creation on its business premises, we conclude that the
    enforcement of the release would cause a harsh and inequi-
    table result, a factor that militates against its enforcement.
    	        To continue our analysis, we next consider whether
    defendant’s business operation serves an important public
    interest or function. The parties sharply disagree about
    the importance of that factor to our resolution of this case.
    According to defendant, that factor is paramount here,
    because, as a matter of law, anticipatory releases of negli-
    gence liability are unenforceable only when a defendant pro-
    vides an “essential” public service.
    	        Although this court has not previously addressed
    that precise issue in the context of a release involving a rec-
    reational activity, other courts have done so. As defendant
    observes, courts in several jurisdictions that lack statutory
    prohibitions of anticipatory releases of liability for negli-
    gence have upheld such releases (at least in part) on the
    ground that the activity at issue did not involve an “essen-
    tial” public service.15 However, courts in other jurisdictions
    	15
           See, e.g., Malecha v. St. Croix Valley Skydiving Club, Inc., 
    392 N.W.2d 727
    (Minn App 1986) (upholding an exculpatory agreement entered into between a
    skydiving operation and a patron); Chepkevich v. Hidden Valley Resort, 607 Pa 1,
    2 A3d 1174 (2010) (skiing); Pearce v. Utah Athletic Foundation, 179 P3d 760 (Utah
    2008) (bobsledding); Benedek v. PLC Santa Monica, LLC, 104 Cal App 4th 1351,
    566	                                      Bagley v. Mt. Bachelor, Inc.
    
    have taken the opposite approach, concluding that, regard-
    less of whether the release involves an essential public ser-
    vice, anticipatory releases that immunize a party from the
    consequences of its own negligence can violate public policy
    or be unconscionable.
    
    	        For example, in Dalury v. S-K-I, Ltd., 164 Vt 329,
    670 A2d 795 (1995), the Vermont Supreme Court rejected
    the argument that anticipatory releases of negligence liabil-
    ity necessarily are enforceable in the context of recreational
    activities because such activities are not essential. 670 A2d
    at 799. In that case, the plaintiff sustained serious inju-
    ries when he collided with a metal pole that formed part of
    the control maze for a ski-lift line. He brought a negligence
    action against the defendant ski area operator, alleging that
    it had negligently designed, built, and placed the maze pole.
    The trial court granted the defendant’s motion for sum-
    mary judgment based on an anticipatory release that the
    plaintiff had signed absolving the defendant of liability for
    negligence.
    
    	        On appeal, the court noted that the release was
    conspicuous and unambiguous, but it nevertheless con-
    cluded that the release violated public policy. Id. at 797. The
    court began its analysis with the Restatement (Second) of
    Torts  § 496B comment b, which states that an anticipatory
    release should be upheld if (1) it is freely and fairly made,
    (2) between parties who are in equal bargaining positions,
    and (3) there is no societal interest with which it interferes.
    Dalury, 670 A2d at 797. The parties’ dispute focused on
    the last issue. The defendant urged the court to conclude
    that, because skiing—like other recreational activities—is
    not a necessity of life, the sale of a lift ticket is a purely
    private transaction that implicates no public interest. The
    court concluded that “no single formula will reach the rele-
    vant public policy issues in every factual context.” Id. at 798.
    Rather, the court stated that it would consider “the totality
    of the circumstances of any given case against the backdrop
    of current societal expectations.” Id.
    
    129 Cal Rptr 2d 197 (2002) (health club); Henderson v. Quest Expeditions, Inc.,
    
    174 S.W.3d 730
    , (Tenn Ct App 2005) (whitewater rafting).
    Cite as 356 Or 543 (2014)	567
    
    	        The court found a significant public policy consider-
    ation in the case in the law of premises liability; in partic-
    ular, the court stated, business owners—including ski area
    operators—owe a duty of care to make their premises safe
    for patrons where their operations create a foreseeable risk
    of harm. Id. at 799. The court observed that
    
          “[d]efendants, not recreational skiers, have the expertise
          and opportunity to foresee and control hazards, and to
          guard against the negligence of their agents and employ-
          ees. They alone can properly maintain and inspect their
          premises, and train their employees in risk management.
          They alone can insure against risks and effectively spread
          the cost of insurance among their thousands of customers.
          Skiers, on the other hand, are not in a position to discover
          and correct risks of harm, and they cannot insure against
          the ski area’s negligence.
    
          	 “If defendants were permitted to obtain broad waivers
          for their liability, an important incentive for ski areas to
          manage risk would be removed with the public bearing the
          cost of the resulting injuries. * * * It is illogical, in these
          circumstances, to undermine the public policy underlying
          business invitee law and allow skiers to bear risks they
          have no ability or right to control.”
    
    Id.
    
    	        Turning to the defendant’s argument that the
    release was enforceable because ski resorts do not provide
    an essential public service, the court stated that,”[w]hile
    interference with an essential public service surely affects
    the public interest, those services do not represent the uni-
    verse of activities that implicate public concerns.” Id. The
    court held that, “when a facility becomes a place of public
    accommodation, it ‘render[s] a service which has become of
    public interest in the manner of the innkeepers and com-
    mon carriers of old.’ ” Id. at 799-800 (quoting Lombard v.
    Louisiana, 
    373 U.S. 267
    , 279, 
    83 S. Ct. 1122
    , 
    10 L. Ed. 2d 338
    (1963)) (internal quotation marks omitted).
    
    	        Finally, the court’s analysis was informed by a
    statute that placed the “inherent risks” of any sport on the
    568	                                          Bagley v. Mt. Bachelor, Inc.
    
    participant, insofar as the risks were obvious and neces-
    sary.16 The court stated that “[a] ski area’s own negligence
    * * * is neither an inherent risk nor an obvious and neces-
    sary one in the sport of skiing,” and, therefore, “a skier’s
    assumption of the inherent risks of skiing does not abrogate
    the ski area’s duty to warn of or correct dangers which in the
    exercise of reasonable prudence in the circumstances could
    have been foreseen and corrected.” Dalury, 670 A2d at 800
    (internal quotation marks omitted).17
    	        We, too, think that the fact that defendant does not
    provide an essential public service does not compel the con-
    clusion that the release in this case must be enforced. As the
    court stated in Dalury, “[w]hile interference with an essen-
    tial public service surely affects the public interest, those
    services do not represent the universe of activities that
    implicate public concerns.” 670 A2d at 799. It is true that
    ski areas do not provide the kind of public service typically
    associated with government entities or heavily regulated
    private enterprises such as railroads, hospitals, or banks.
    See Real Good Food, 276 Or at 1061 (“Banks, like common
    carriers and utility companies, perform an important public
    service, and, for that very reason, are subject to state and
    federal regulation.”). However, like other places of public
    accommodation such as inns or public warehouses, defen-
    dant’s business premises—including its terrain park—are
    	16
             Vermont Statutes Annotated title 12, section 1037, provides:
         	 “Notwithstanding the provisions of section 1036 of this title, a person
         who takes part in any sport accepts as a matter of law the dangers that
         inhere therein insofar as they are obvious and necessary.”
    	17
             For similar reasons, the Connecticut Supreme Court also has declined to
    enforce an anticipatory release of negligence liability in the face of the defendant’s
    contention that recreational activities do not implicate the public interest. Hanks
    v. Powder Ridge Restaurant Corp., 276 Conn 314, 885 A2d 734 (2005). Hanks
    was a negligence action brought by a plaintiff who was injured when his foot was
    caught between his snowtube and the artificial bank of a snowtubing run at a ski
    resort operated by the defendant. The defendant relied on an anticipatory release
    that the plaintiff had signed that purported to absolve the defendant from liabil-
    ity for its negligence. The court acknowledged that the release was conspicuous
    and unambiguous, but ultimately agreed with the Vermont Supreme Court that
    determining what constitutes the public interest required consideration of all
    relevant circumstances, including that the plaintiff lacked sufficient knowledge
    and authority to discern whether, much less ensure that, the snowtubing runs
    were maintained in a reasonably safe condition. Id. at 331. Thus, the court held,
    “it is illogical to permit snowtubers, and the public generally, to bear the costs of
    risks that they have no ability or right to control.” Id. at 332.
    Cite as 356 Or 543 (2014)	569
    
    open to the general public virtually without restriction, and
    large numbers of skiers and snowboarders regularly avail
    themselves of its facilities. To be sure, defendants’ business
    facilities are privately owned, but that characteristic does
    not overcome a number of legitimate public interests con-
    cerning their operation.18
    	         The major public interests at stake are those under-
    lying the law of business premises liability. The policy ratio-
    nale is to place responsibility for negligently created con-
    ditions of business premises on those who own or control
    them, with the ultimate goal of mitigating the risk of inju-
    ry-producing accidents. Hagler, 354 Or at 140-41; Garrison,
    334 Or at 272. In that setting, where a business operator
    extends a general invitation to enter and engage in activi-
    ties on its premises that is accepted by large numbers of the
    public, and those invitees are subject to risks of harm from
    conditions of the operator’s creation, their safety is a matter
    of broad societal concern. See Dalury, 670 A2d 799 (“[W]hen
    a substantial number of such sales take place as a result of
    the [operator’s] general invitation to the public to utilize the
    facilities and services in question, a legitimate public inter-
    est arises.”). The public interest, therefore, is affected by the
    performance of the operator’s private duties toward them.
    See, e.g., Strawbridge v. Sugar Mountain Resort, Inc., 320 F
    Supp 2d 425, 433-34 (WD NC 2004) (holding, under North
    Carolina law, that “the ski industry is sufficiently regulated
    and tied to the public interest” to preclude enforcement of
    anticipatory release, based on the principle that “a party
    cannot protect himself by contract[ing] against liability
    for negligence * * * where * * * public interest is involved, or
    where public interest requires the performance of a private
    duty”). Accordingly, we reject defendant’s argument that
    the fact that skiing and snowboarding are “non-essential”
    activities compels enforcement of the release in this case.
    
    	18
            Public accommodations laws that prohibit discrimination against poten-
    tial users of the facility are just one example of limitations imposed by law that
    affect the use of defendant’s premises. See, e.g., ORS 447.220 (explaining pur-
    pose of ORS 447.210-280 to make places of public accommodation accessible to
    persons with disability); ORS 447.210 (defining public accommodation to include
    “places of recreation”); ORS 659A.403 (prohibiting discrimination in places of
    public accommodation); ORS 659A.400 (defining places of public accommodation
    for purposes of ORS 659A.403 to include places offering “amusements”).
    570	                                       Bagley v. Mt. Bachelor, Inc.
    
    Instead, we conclude that defendant’s business operation is
    sufficiently tied to the public interest as to require the per-
    formance of its private duties to its patrons.
    	         Finally, we consider the nature of the conduct
    to which the release would apply in this case. Defendant
    makes a fair point that, although the release purports to
    immunize it from liability for any misconduct short of inten-
    tional conduct, plaintiff’s claim is based on ordinary neg-
    ligence. Defendant notes that this court has held that an
    anticipatory release violates public policy where it purports
    to immunize the releasee from liability for gross negligence,
    reckless, or intentional conduct, but a release that disclaims
    liability only for ordinary negligence more often is enforced.
    K–Lines, 273 Or at 249. That statement is correct as a gen-
    eral comment on the validity of anticipatory releases, but,
    of course, whether any particular release will be enforced
    depends on the various factors that we discuss in this opin-
    ion. In the circumstances of this transaction, the fact that
    plaintiff’s claim is based on negligence rather than on more
    egregious conduct carries less weight than the other sub-
    stantive factors that we have considered or than it would,
    for example, in a commercial transaction between parties of
    relatively equal bargaining power.19
                     SUMMARY AND APPLICATION
    	       To summarize, our analysis leads to the conclusion
    that permitting defendant to exculpate itself from its own
    negligence would be unconscionable. As discussed, import-
    ant procedural factors supporting that conclusion include
    the substantial disparity in the parties’ bargaining power in
    the particular circumstances of this consumer transaction,
    and the fact that the release was offered to plaintiff and
    defendant’s other customers on a take-it-or-leave-it basis.
    	        There also are indications that the release is sub-
    stantively unfair and oppressive. First, a harsh and inequi-
    table result would follow if defendant were immunized from
    negligence liability, in light of (1) defendant’s superior ability
    to guard against the risk of harm to its patrons arising from
    
    	19
            Defendant does not contend that the release would be enforceable against
    a claim based on alleged gross negligence or reckless conduct.
    Cite as 356 Or 543 (2014)	571
    
    its own negligence in designing, creating, and maintaining
    its runs, slopes, jumps, and other facilities; and (2) defen-
    dant’s superior ability to absorb and spread the costs asso-
    ciated with insuring against those risks. Second, because
    defendant’s business premises are open to the general public
    virtually without restriction, large numbers of skiers and
    snowboarders regularly avail themselves of its facilities, and
    those patrons are subject to risks of harm from conditions
    on the premises of defendant’s creation, the safety of those
    patrons is a matter of broad societal concern. The public
    interest, therefore, is affected by the performance of defen-
    dant’s private duties toward them under business premises
    liability law.
    	         In the ultimate step of our unconscionability
    analysis, we consider whether those procedural and sub-
    stantive considerations outweigh defendant’s interest in
    enforcing the release at issue here. Restatement (Second) of
    Contracts § 178 comment b (“[A] decision as to enforceability
    is reached only after a careful balancing, in the light of
    all the circumstances, of the interest in the enforcement
    of the particular promise against the policy against the
    enforcement of such terms.”). Defendant argues that, in
    light of the inherent risks of skiing, it is neither unfair nor
    oppressive for a ski area operator to insist on a release from
    liability for its own negligence. As defendant explains,
       “[W]hen the plaintiff undertook this activity, he exposed
       himself to a high risk of injury. Only he controlled his
       speed, course, angle, ‘pop’ and the difficulty of his aerial
       maneuver. Skiing and snowboarding requires [sic] the
       skier to exercise appropriate caution and good judgment.
       Sometimes, even despite the exercise of due care, accidents
       and injuries occur.”
    Further, defendant contends, denying enforcement of such
    a release
       “improperly elevates premises liability tort law above the
       freedom to contract, fails to take into account the counter-
       vailing policy interest of providing recreational opportu-
       nities to the public, fails to recognize that certain recre-
       ational activities are inherently dangerous and fails to con-
       sider the fact that the ski area operator has little, if any,
       control over the skier/snowboarder.”
    572	                                        Bagley v. Mt. Bachelor, Inc.
    
    	       Defendant’s arguments have some force. After all,
    skiing and snow boarding are activities whose allure and
    risks derive from a unique blend of factors that include
    natural features, artificial constructs, and human engage-
    ment. It may be difficult in such circumstances to untangle
    the causal forces that lead to an injury-producing accident.
    Moreover, defendant is correct that several relevant fac-
    tors weigh in favor of enforcing the release. As discussed,
    the release was conspicuous and unambiguous, defendant’s
    alleged misconduct in this case was negligence, not more
    egregious conduct, and snowboarding is not a necessity of
    life.
    	        That said, the release is very broad; it applies on its
    face to a multitude of conditions and risks, many of which
    (such as riding on a chairlift) leave defendant’s patrons vul-
    nerable to risks of harm of defendant’s creation. Accepting
    as true the allegations in plaintiff’s complaint, defendant
    designed, created, and maintained artificial constructs,
    including the jump on which plaintiff was injured.20 Even
    in the context of expert snowboarding in defendant’s terrain
    park, defendant was in a better position than its invitees to
    guard against risks of harm created by its own conduct.
    	        A final point deserves mention. It is axiomatic that
    public policy favors the deterrence of negligent conduct.
    2 Farnsworth on Contracts § 5.2, 9-12 (“[i]n precedents
    accumulated over centuries,” courts have relied on policy
    “against the commission or inducement of torts and similar
    wrongs”). Although that policy of deterrence has implica-
    tions in any case involving the enforceability of an anticipa-
    tory release of negligence liability, here, that policy bolsters
    the other considerations that weigh against enforcement of
    the release. As the parties readily agree, the activities at
    issue in this case involve considerable risks to life and limb.
    Skiers and snowboarders have important legal inducements
    to exercise reasonable care for their own safety by virtue
    of their statutory assumption of the inherent risks of ski-
    ing. By contrast, without potential exposure to liability for
    	20
            We reiterate that the issues of whether defendant actually was negligent
    in one or more of the particulars alleged by plaintiff, whether and the extent to
    which plaintiff was comparatively negligent, and the extent to which either par-
    ty’s negligence actually caused plaintiff’s injuries, are not before us on review.
    Cite as 356 Or 543 (2014)	573
    
    their own negligence, ski area operators would lack a com-
    mensurate legal incentive to avoid creating unreasonable
    risks of harm to their business invitees. See Alabama Great
    Southern Railroad Co. v. Sumter Plywood Corp., 359 So 2d
    1140, 1145 (Ala 1978) (human experience shows that excul-
    patory agreements induce a lack of care). Where, as here,
    members of the public are invited to participate without
    restriction in risky activities on defendant’s business prem-
    ises (and many do), and where the risks of harm posed by
    operator negligence are appreciable, such an imbalance in
    legal incentives is not conducive to the public interest.
    	        Because the factors favoring enforcement of the
    release are outweighed by the countervailing considerations
    that we have identified, we conclude that enforcement of the
    release at issue in this case would be unconscionable.21 And,
    because the release is unenforceable, genuine issues of fact
    exist that preclude summary judgment in defendant’s favor.
    It follows that the trial court erred in granting defendant’s
    motion for summary judgment and in denying plaintiff’s
    cross-motion for partial summary judgment, and that the
    Court of Appeals erred in affirming the judgment dismiss-
    ing plaintiff’s action.
    	      The decision of the Court of Appeals is reversed.
    The judgment of the trial court is reversed and the case is
    remanded to that court for further proceedings.
    
    
    
    
    	21
            By so concluding, we do not mean to suggest that a business owner or oper-
    ator never may enforce an anticipatory release or limitation of negligence liability
    from its invitees. As explained, multiple factors may affect the analysis, includ-
    ing, among others, whether a legally significant disparity in the parties’ bargain-
    ing power existed that made the release or limitation unfairly adhesive, whether
    the owner/operator permitted a patron to pay additional reasonable fees to obtain
    protection against negligence, the extent to which the business operation is tied
    to the public interest, including whether the business is open to and serves large
    numbers of the general public without restriction, and the degree to which the
    personal safety of the invitee is subjected to the risk of carelessness by the owner/
    operator.