Rule 7: Lawsuits

[Timothy]

Over in the "Who Judges?" thread

http://forums.randi.org/showthread.php?t=56299

Beleth said:

"for an accepted Challenge is a legally binding contract, and if the JREF decided to pick up its ball, the applicant would be able to sue the JREF in a court of law and easily win"

But is this true? I doubt it.

"7. When entering into this challenge, the applicant surrenders any and all rights to legal action against Mr. Randi, against any persons peripherally involved, and against the James Randi Educational Foundation, as far as this may be done by established statutes. This applies to injury, accident, or any other damage of a physical or emotional nature, and/or financial or professional loss, or damage of any kind. However, this rule in no way affects the awarding of the prize." (bold mine)

If there were a case where Applicant says "I passed the test" and JREF says "no, you didn't", then the Applicant cannot bring the case to court. He has specifically abrogated that right. While the second sentence of the paragraph talks about some of the things this condition applies to, it does not say "This applies only to..." so there is no retention of rights there. And the third sentence is very vague. "This rule in no way affects the awarding of the prize"? You're right. It doesn't. JREF can choose to not award the prize, and the Applicant has no legal recourse. (Not that I think he should, mind you. I'm just reading what the rules say.)

I say that an Applicant can't sue for non-awarding of the Prize even if he is obviously spectacularly successful. Any contract lawyers want to weigh in on the document as written? My point is that it's not a very well written contract.

- Timothy

P.S. - As written, if I applied for the Challenge, and then in several years was injured in an auto accident caused by Mr. Randi, I could not pursue any legal action against him.

[Plasmadog]

I am not a lawyer, but I'm pretty sure that in cases like that, the waiver does not apply to upholding the contract that contains the waiver. In other words, the applicant is signing away the right to sue over anything other than breach of the challenge contract.

But, as I say, IANAL. I would also be interested to see a real lawyers opinion on that.

[Jon.]

"7. When entering into this challenge, the applicant surrenders any and all rights to legal action against Mr. Randi, against any persons peripherally involved, and against the James Randi Educational Foundation, as far as this may be done by established statutes. This applies to injury, accident, or any other damage of a physical or emotional nature, and/or financial or professional loss, or damage of any kind. However, this rule in no way affects the awarding of the prize." (bold mine)

I say that an Applicant can't sue for non-awarding of the Prize even if he is obviously spectacularly successful. Any contract lawyers want to weigh in on the document as written? My point is that it's not a very well written contract.

I think you're wrong here. Look at the last sentence of the clause. Whether or not the prize must be awarded is something to do with the awarding of the prize, which the rule specifically does not cover. Therefore, an applicant can sue for the $1 million and if she can prove she passed the test according to the agreed-upon protocols, she will succeed.

P.S. - As written, if I applied for the Challenge, and then in several years was injured in an auto accident caused by Mr. Randi, I could not pursue any legal action against him.

I doubt it. In order to exclude liability for negligence, you have to be pretty specific. You almost have to use the words "exclude", "liability" and "negligence" in the same sentence (not quite, but it's close). 99% of auto accident cases are pleaded and decided in negligence. Also, the court would look to the intentions of the party drafting the contract. I doubt any court would find that either party intended such a result.

[Errata]

"7. When entering into this challenge, the applicant surrenders any and all rights to legal action against Mr. Randi, against any persons peripherally involved, and against the James Randi Educational Foundation, as far as this may be done by established statutes. This applies to injury, accident, or any other damage of a physical or emotional nature, and/or financial or professional loss, or damage of any kind. However, this rule in no way affects the awarding of the prize." (bold mine)


"7. When entering into this challenge, the applicant surrenders any and all rights to legal action against Mr. Randi, against any persons peripherally involved, and against the James Randi Educational Foundation, as far as this may be done by established statutes. This applies to injury, accident, or any other damage of a physical or emotional nature, and/or financial or professional loss, or damage of any kind. However, this rule in no way affects the awarding of the prize." (bold mine)

You have to read the whole thing. You can't cherry pick the bits that say what you want them to say. The rule, as a whole, very clearly and explicitly only applies to people who get hurt by the challenge. It does not invalidate the rest of the contract when it comes to conditions under which the prize should be awarded.

[Santa666]

Over in the "Who Judges?" thread

http://forums.randi.org/showthread.php?t=56299

Beleth said:

"for an accepted Challenge is a legally binding contract, and if the JREF decided to pick up its ball, the applicant would be able to sue the JREF in a court of law and easily win"

But is this true? I doubt it.

"7. When entering into this challenge, the applicant surrenders any and all rights to legal action against Mr. Randi, against any persons peripherally involved, and against the James Randi Educational Foundation, as far as this may be done by established statutes. This applies to injury, accident, or any other damage of a physical or emotional nature, and/or financial or professional loss, or damage of any kind. However, this rule in no way affects the awarding of the prize." (bold mine)

If there were a case where Applicant says "I passed the test" and JREF says "no, you didn't", then the Applicant cannot bring the case to court. He has specifically abrogated that right. While the second sentence of the paragraph talks about some of the things this condition applies to, it does not say "This applies only to..." so there is no retention of rights there. And the third sentence is very vague. "This rule in no way affects the awarding of the prize"? You're right. It doesn't. JREF can choose to not award the prize, and the Applicant has no legal recourse. (Not that I think he should, mind you. I'm just reading what the rules say.)

I say that an Applicant can't sue for non-awarding of the Prize even if he is obviously spectacularly successful. Any contract lawyers want to weigh in on the document as written? My point is that it's not a very well written contract.

- Timothy

P.S. - As written, if I applied for the Challenge, and then in several years was injured in an auto accident caused by Mr. Randi, I could not pursue any legal action against him.

Another key phrase is bolded and resized by me. Many states have provisions concerning contractual law pertaining to what rights you can or cannot sign away. A contract is only as good as the state laws governing what kinds of agreements can be entered into.


Santa

[Greyman]

It seems worthy to me to note that these rules are on the application, not the contract. I believe after negotiating a protocol there is another document signed that states something to the effect of; If claimant successfully does X by the terms set previously claimant shall be awarded 1 Million Dollars by JREF.

Though I may be wrong since I've never been an applicant.

ETA - Excuses in the event that I'm a moron.

Further ETA - I am indeed a moron, oops. It is the contract.

And - The final line of Rule 7 is the guarantor of legal action in the case that the a award is not awarded upon the terms of success agreed upon per rules 1 and 12.

Just so we can see it one more time;

When entering into this challenge, the applicant surrenders any and all rights to legal action against Mr. Randi, against any persons peripherally involved, and against the James Randi Educational Foundation, as far as this may be done by established statutes. This applies to injury, accident, or any other damage of a physical or emotional nature, and/or financial or professional loss, or damage of any kind. However, this rule in no way affects the awarding of the prize.

The bolded quite plainly states that the applicant does not surrender any rights to legal action in regards to the awarding of the prize. Only without so many words.

[NoZed Avenger]

I am not a lawyer, but I'm pretty sure that in cases like that, the waiver does not apply to upholding the contract that contains the waiver. In other words, the applicant is signing away the right to sue over anything other than breach of the challenge contract.

But, as I say, IANAL. I would also be interested to see a real lawyers opinion on that.

I am a lawyer, and the language does not waive the right to recover the million in the case of a successful test. This has been dealt with a number of times already on the forum; I don't know how easy a search is/would be, but it just doesn't say that.

[Timothy]

I am a lawyer, and the language does not waive the right to recover the million in the case of a successful test.
Okey dokey, then. I got my answer.

[Ririon]

Another key phrase is bolded and resized by me. Many states have provisions concerning contractual law pertaining to what rights you can or cannot sign away. A contract is only as good as the state laws governing what kinds of agreements can be entered into.


Santa
This contract will be subject to Florida/USA law, won't it? If not, the contract will mean slightly different things for different applicants. I mean, if I applied, would this contract be interpreted using Norwegian law? IANAL, of course. Not even close. :)

[IsaacKoi]

This contract will be subject to Florida/USA law, won't it?

Not necessarily.

To avoid the considerable uncertainty that can exist, it is extremely common for contracts to contain provisions which expressly specify:
(1) the law governing the contract (a "choice of law clause") and
(2) the court in which any claim must be made (a "jurisdiction clause").

The Rules do not appear to contain, or refer to, any such provisions.

This raises the question in my mind as to whether the Rules were drafted with the advice of a lawyer, or whether they have been discussed (on this Forum or elsewhere) in any detail by a lawyer.

Kind Regards,

Isaac Koi (a barrister in England)

[Alex_Turner]

I initially thought the same as you did, Isaac. However, in replying to another thread, I realised that this lack of 'Choice of Law' may be intentional, to allow the JREF to choose a venue depending on its interests at the time. The JREF might, in one situation, wish to file in Florida (where the JREF would most likely have its liability limitation terms be upheld, for instance), while in another situation may prefer to file in Federal Court, or in the residence of the applicant.

[William Smith]

I initially thought the same as you did, Isaac. However, in replying to another thread, I realised that this lack of 'Choice of Law' may be intentional, to allow the JREF to choose a venue depending on its interests at the time. The JREF might, in one situation, wish to file in Florida (where the JREF would most likely have its liability limitation terms be upheld, for instance), while in another situation may prefer to file in Federal Court, or in the residence of the applicant.

Do you work as a lawyer and can back your assumption?

Or did you just speculate?

[gnome]

Okey dokey, then. I got my answer.

Hey, that's great... finally someone that, upon being given the explanation, doesn't say "No, really, they don't have to pay you! Teh challeng is a fraud!!!!11!"

[William Smith]

...
Teh challeng is a fraud!!!!11!"

Good one, gnome. :D

[Plasmadog]

Do you work as a lawyer and can back your assumption?

Or did you just speculate?
Dude, lighten up. He didn't state anything except that it had occured to him that the JREF may have done it intentionally. What is there to back up?

[William Smith]

Dude, lighten up. He didn't state anything except that it had occured to him that the JREF may have done it intentionally. What is there to back up?

Good question.

I occured to me you may be a pedophile cannibal.

What is there to back up?

[Roadtoad]

To repeat what's been said: It only applies to someone who injures him/herself while engaged in the challenge. In other words, if someone manages telekinesis, and actually lifts a bowling ball over their head and drops it, injuring themselves, they can't sue Randi because they were stupid.

Hell, I'm not even a lawyer, and I could figure this one out!

[William Smith]

Dude, lighten up. He didn't state anything except that it had occured to him that the JREF may have done it intentionally. What is there to back up?

Also, I directed my inquiry to Alex_Turner. Trying to answer for him also qualifies as speculation. ;)

[Alex_Turner]

Do you work as a lawyer and can back your assumption?

Or did you just speculate?

No, I don't work as a lawyer, and I don't belive I made any assumptions. I am just speculating. Why so hostile? It's not a bad thing that JREF wrote it's rules to protect itself legally.

Look, it's not an unreasonable conclussion. When a contract is silent on the issue, the laws of the state where the contract was made apply. However, sometimes it's not that clear; the contract could be made across state lines, on the internet, or through mail (ring a bell, in this case?). The JREF's attorney might think it's better to leave the issue open.

Or, it could just not be lawyer-written. I'm speculating.

[William Smith]

No, I don't work as a lawyer, and I don't belive I made any assumptions. I am just speculating. Why so hostile? It's not a bad thing that JREF wrote it's rules to protect itself legally.

Look, it's not an unreasonable conclussion. When a contract is silent on the issue, the laws of the state where the contract was made apply. However, sometimes it's not that clear; the contract could be made across state lines, on the internet, or through mail (ring a bell, in this case?). The JREF's attorney might think it's better to leave the issue open.

Or, it could just not be lawyer-written. I'm speculating.

Please do not consider me hostile, Alex_Turner, I am just curious about the motives of your speculation.

What purpose does your speculation serve?

[Alex_Turner]

What purpose does your speculation serve?

Promotes discussion? Relives boredom?

[Roadtoad]

Promotes discussion? Relives boredom?

Cures halitosis! Removes painful corns from feet! And needs no prescription!

[William Smith]

Promotes discussion? Relives boredom?

No. And: Yes, it "relives" boredom of past threads. However, it "relieves" nothing.

Let's try this again: What purpose does your speculation serve?

[Alex_Turner]

No. And: Yes, it "relives" boredom of past threads. However, it "relieves" nothing.

Let's try this again: What purpose does your speculation serve?

On the contrary, it has promoted discussion. At very least, you found it interesting enough to ask for clarification.

I'm not sure, however, that I follow your questions. What purpose does my speculation serve? Is this a philosophical question? I would suppose it serves as an intellectual exercise, meant to hone one's reasoning skills.

[William Smith]

On the contrary, it has promoted discussion. At very least, you found it interesting enough to ask for clarification.

I'm not sure, however, that I follow your questions. What purpose does my speculation serve? Is this a philosophical question? I would suppose it serves as an intellectual exercise, meant to hone one's reasoning skills.

Your definition of "promoting discussion" differs from mine, Alex_Turner.

The point of my inquiry about your statement in post #11 was to clarify your position why you "(...) realised that this lack of 'Choice of Law' may be intentional, to allow the JREF to choose a venue depending on its interests at the time. The JREF might, in one situation, wish to file in Florida (where the JREF would most likely have its liability limitation terms be upheld, for instance), while in another situation may prefer to file in Federal Court, or in the residence of the applicant."

You answered that by saying "(...) I'm speculating." (Post #19)

I see no point in speculation when you could simply inquire at challenge@randi.org what the JREF's intentions with this rule are, if you really had an interest in it.

Again, no hostility intended, Alex_Turner. Just tap the source, when possible.

[Darat]

Not necessarily.

To avoid the considerable uncertainty that can exist, it is extremely common for contracts to contain provisions which expressly specify:
(1) the law governing the contract (a "choice of law clause") and
(2) the court in which any claim must be made (a "jurisdiction clause").

The Rules do not appear to contain, or refer to, any such provisions.

This raises the question in my mind as to whether the Rules were drafted with the advice of a lawyer, or whether they have been discussed (on this Forum or elsewhere) in any detail by a lawyer.

Kind Regards,

Isaac Koi (a barrister in England)

The JREF does have an attorney who has worked with Randi and the JREF for a long time (he even gave an entertaining talk at TAM 3), they are well aware of the legal ramifications of the Challenge.

[steenkh]

Again, no hostility intended, Alex_Turner. Just tap the source, when possible.
It certainly sounded hostile to me. You made it sound as if there is some sinister motive behind speculating that the JREF actually knows what it is doing.

As for tapping the source about the legal reasons behind certain wordings, I would not be surprised if the answer would be "Send your application, or get lost!" ... and I have no intention of writing the JREF to find out if I am right!

[porch]

I see no point in speculation when you could simply inquire at challenge@randi.org what the JREF's intentions with this rule are, if you really had an interest in it.

Aren't you calling into question the entire existence of the Million Dollar Challenge section of these boards?

[gnome]

It certainly sounded hostile to me. You made it sound as if there is some sinister motive behind speculating that the JREF actually knows what it is doing.

As for tapping the source about the legal reasons behind certain wordings, I would not be surprised if the answer would be "Send your application, or get lost!" ... and I have no intention of writing the JREF to find out if I am right!

The perceived hostility is probably as a result of many people who come here, start out "speculating" and then quickly reveal their own hostility to the challenge and JREF itself. For the most part, they are not interested in determining the legal truth, only of pressing their own interpretation that is unfavorable to JREF. This has happened many times, so lots of us are a little wary.

Regarding "tapping the source"... you are probably not likely to get such a response if you write to the official contact for the challenge.

[steenkh]

Regarding "tapping the source"... you are probably not likely to get such a response if you write to the official contact for the challenge.
Because it will not be Randi who replies? ;)

[Irony-Man]

I'm a law professor in Canada. This clause would be considered a waiver or exclusionary clause which limits the rights in action of the parties. However it is well established in contract law that where an exclusionary clause is contained in a standard form contract - which means it is presented by one side to the other with little or no opportunity to change it - exclusionary clauses will not apply to a fundamental breach of that contract. In other words, you cannot limit the rights of a person to sue you for failing to perform the essential subject matter of the contract. In this case, the Challenge application establishes that the exchange, or consideration, between the parties will be for the challenger to perform the agreed upon test, and upon succesful completion of that task, as measured by the previously agreed upon criteria, to receive the $1,000,000.00 (does everyone else have to imitate Dr. Evil whenever they say $1,000,000.00?). Any attempt bu thr JREF to deny the prize upon successfully meeting the terms of the challenge would be considered a fundamental breach and would be actionable in court. This doesn't mean the the challenger would win in court but they could bring teh case.

i hope this helps.

[steenkh]

Thanks for the explanation! I had always assumed this was the case, but not being educated in law, I could not be sure. And several would-be applicants have assumed the opposite. It would have been a smart move if the JREF had made this crystal clear so that the applicants had one less excuse.

[Mental Professor]

I am a lawyer, and the language does not waive the right to recover the million in the case of a successful test. This has been dealt with a number of times already on the forum; I don't know how easy a search is/would be, but it just doesn't say that.
I'm a law professor in Canada. This clause would be considered a waiver or exclusionary clause which limits the rights in action of the parties. However it is well established in contract law that where an exclusionary clause is contained in a standard form contract - which means it is presented by one side to the other with little or no opportunity to change it - exclusionary clauses will not apply to a fundamental breach of that contract. In other words, you cannot limit the rights of a person to sue you for failing to perform the essential subject matter of the contract.
What about JREF's right to sue the applicant? I submitted my application (you can read about it at http://forums.randi.org/showthread.php?t=57001 ) and asked for the same protection from litigation that Randi requests. They turned me down. My lawyer won't be back til next Tuesday so I can't ask him anything.
If you consulted an attorney, he would (should?) have told you that this was clearly a Contract of Adhesion. He then would have (should have?) told you that you were wasting your time trying to change the terms. Mutual limitation of liability, like you want here, pretty much never appears in these kind of contracts. Why? Because of the unequal negotiating positions intrinsic to Contracts of Adhesion, the superior party will never accept the term (barring incompetence).
Is this accurate?

[William Smith]

Aren't you calling into question the entire existence of the Million Dollar Challenge section of these boards?

No.

[William Smith]

The perceived hostility is probably as a result of many people who come here, start out "speculating" and then quickly reveal their own hostility to the challenge and JREF itself. For the most part, they are not interested in determining the legal truth, only of pressing their own interpretation that is unfavorable to JREF. This has happened many times, so lots of us are a little wary.

Regarding "tapping the source"... you are probably not likely to get such a response if you write to the official contact for the challenge.

I agree with what you said in the first paragraph, gnome.

How and where do you propose interested people should inquire?

[Darat]

What about JREF's right to sue the applicant? I submitted my application (you can read about it at http://forums.randi.org/showthread.php?t=57001 ) and asked for the same protection from litigation that Randi requests. They turned me down. My lawyer won't be back til next Tuesday so I can't ask him anything.

...snip...


You did not submit an application for the Challenge.

[Mental Professor]

You did not submit an application for the Challenge
I DIDsubmit an application for the Challenge

[gnome]

I agree with what you said in the first paragraph, gnome.

How and where do you propose interested people should inquire?

For official inquiries, I would email challenge@randi.org

Also, the FAQ covers a lot... and anyone that knows how to give a straight answer to clarifying questions, when they're seeking knowledge, can get some pretty good ideas here (though unofficial)

[aggle-rithm]

I doubt it. In order to exclude liability for negligence, you have to be pretty specific. You almost have to use the words "exclude", "liability" and "negligence" in the same sentence (not quite, but it's close). 99% of auto accident cases are pleaded and decided in negligence. Also, the court would look to the intentions of the party drafting the contract. I doubt any court would find that either party intended such a result.

The contract that people sign to be on American Idol, I've heard, is worded to be very clear on the scope of the contract. It uses the phrase, "throughout the Universe and in perpetuity" quite a lot. I guess they want to be very specific that they OWN you if you sign that document.

[petre]

Gotta agree with MP there based on Jeff's posting of it, though it should be understand that there are MANY (I ought to use a larger font myself to stress this, but I'll be kind) people that claim to have applied when they in fact have not.

I'll look forward to hearing what your lawyer friend has to say about the matter.

ETA: it seems Darat's specific point was an objection to a rule change request nullifying it as an appropriate application, based on his reply in the other thread.

[William Smith]

...
I see no point in speculation when you could simply inquire at challenge@randi.org what the JREF's intentions with this rule are, if you really had an interest in it.
Again, no hostility intended, Alex_Turner. Just tap the source, when possible



...
Regarding "tapping the source"... you are probably not likely to get such a response if you write to the official contact for the challenge.


For official inquiries, I would email challenge@randi.org
...


Gnome, now I think you are the Cmdr. Riker to my LtCmdr. Data. ;)

[gnome]

Gnome, now I think you are the Cmdr. Riker to my LtCmdr. Data. ;)

Hehe... It was asked again, so I answered again... :)

[princhester]

However it is well established in contract law that where an exclusionary clause is contained in a standard form contract - which means it is presented by one side to the other with little or no opportunity to change it - exclusionary clauses will not apply to a fundamental breach of that contract.

Is this true in Florida? I ask because (a) it's not true in some common law jurisdictions (my own for example) and (b) you say you are from Canada, not Florida. You may well of course have an excellent knowledge of Floridan law. I'm just curious.

It's all irrelevant anyway, because of the third sentence in the clause.

[Darat]

I DIDsubmit an application for the Challenge

Unless you misinformed us in your posts in the other thread you did not submit an application for the "One Million Dollar Paranormal Challenge".

What you did was ask the JREF to put up the million dollars for a challenge of your own devising.