Abuse of Contract and the July 2020 Bar Exam

Abuse of Contract and the July 2020 Bar Exam

This summer, the Kansas Board of Law Examiners (KBE) is demanding that all examinees sign a statement that they have “voluntarily” assumed COVID-related risks before they sit for the July 2020 bar examination. According to the July 2020 Kansas Bar Examination Examinee Code of Conduct Agreement (KS Code of Conduct Agreement) recently distributed by the KBE, if an examinee fails to sign and return the KS Code of Conduct Agreement by July 15, “the examinee will not be allowed to sit for the July 2020 examination.” Specifically, before sitting for the exam, each examinee must specifically affirm:

10. I have decided to sit for the for the examination despite the risk of exposure to or infection with COVID-19 and voluntarily assume all risks of exposure to or infection with COVID-19 by attending the July 2020 administration of the Uniform Bar Examination.

There are several areas of concern related to the administration of the bar exam this year. One wonders about the impact on examinees of having to wear a mask throughout the entire two-day exam, for example. But let me focus here just on issues raised by the exculpatory provision in the document that each examinee is required to sign.

This exculpatory language is as novel to the history of Kansas bar examinations as is the virus that inspired it. But the bar examiners in Kansas are not alone in adopting this approach to the 2020 bar exam. In fact, the Kansas waiver seems to be modeled on a similar document that North Carolina bar examiners provided to their examinees this year. The Agreement provided to North Carolina examinees has identical exculpatory language to the KS Code of Conduct Agreement. The North Carolina version also includes additional language, warning that “the possibility of such exposure or infection may result in personal injury, illness, permanent disability, and death.”

Mississippi will also require all its examinees to sign a legal document on the day of the exam that explains to examinees that by signing they are “giving up valuable legal rights.” The Mississippi State Supreme Court helpfully included the waiver’s precise language as an exhibit to their May 14th holding that the state’s July bar exam proceed on schedule.

If these bar exam COVID-19 liability waivers (Bar Exam Waivers) had been presented as a hypothetical fact scenario on a contract law examination (or, say, a bar exam), I would expect my law students to recognize several legally problematic issues connected with them.

First, in spite of being included in documents called an “Agreement,” these Bar Exam Waivers do not appear to be part of a true quid pro quo exchange. In order to be enforceable as a contract, a contracting party’s commitments must have been made to obtain a reciprocal commitment from the counterparty—a process otherwise referred to as consideration. The examinees’ promise to relinquish all liability claims connected with contracting COVID-19, however, is completely one-sided. Not only is this waiver of liability via assumption of risk made after the examinees have already contracted to take the bar exam, but their commitment to assume the associated risks is made without the counterparty bar examiners making any reciprocal promises to the examinees. A legal argument could be made, therefore, that the assumption of risk clause is ineffective because it is an additional (post-contractual) requirement unilaterally imposed by one party upon the other, in exchange for nothing. If this is true, then the Bar Exam Waivers lack consideration, making them unenforceable under principles of contract law.

In the real world, lack of consideration is rarely a successful claim in breach of contract lawsuits. Indeed, prior to the pandemic, assumption of risk clauses were frequently found in contracts between an operator and a participant who wishes to engage in an inherently dangerous activity, and courts typically found that a participant’s agreement to waive operator liability for personal injury formed part of the consideration given in exchange for the operator’s agreement to allow the participant to engage in the dangerous activity to begin with.

If you wanted to try sky-diving, for example, you likely would be asked to sign a similar exculpatory clause asserting that you have voluntarily agreed to assume all risk of that dangerous activity. The operator of a recreational skydiving business thus agrees to take you up in, and allow you to jump out of, their airplane in exchange for both your payment of a fee and your waiver of associated legal claims. In the context of such inherently dangerous activities, an adequate quid pro quo therefore exists for courts to uphold liability waivers.

Until 2020, however, sitting for a bar examination was never considered an inherently dangerous activity, and such assumption of risk clauses were not involved. Bar examination boards now apparently view taking the July 2020 Bar Exam as an inherently dangerous activity for which the assumption of risk model is appropriate. Requiring examinees to sign an express assumption of risk clause to take the bar exam is more objectionable than, say, requiring one for those choosing to ride the world’s highest waterslide, because no one takes a bar exam for the adrenaline-fueled thrill of the experience. The bar examination is taken so the individual can legally practice law.

This brings us to the second legally problematic aspect of Bar Exam Waivers: they will be procured by duress. Although people are typically bound to contractual commitments to which they objectively manifest assent, if a manifestation of assent is coerced, then the purported promise is not legally enforceable. A manifestation is deemed coerced and unenforceable if procured through a threat and if there is no reasonable alternative under the circumstances other than to manifest assent.

Here, examinees have been given a credible threat to compel their signature on the Bar Exam Waivers. If they refuse to sign the document, they will “not be allowed to sit for the July 2020 examination.” An increasing number of states have offered recent law school graduates an alternative to an in-person bar exam this July. For example, recent graduates in Utah can become licensed to practice in 2020 without taking a bar exam at all, as long as they are supervised by an experienced attorney for the first 360 hours of legal work and graduate from a law school that had an adequately high bar exam passing rate in 2019. But the states that are requiring examinees sign a Bar Exam Waiver have offered no alternative to taking the exam. Therefore, because there is no alternative way for a new graduate to become a practicing attorney in these states, the examinees have no choice but to sign the state’s Bar Exam Waiver. The verbiage used in the Bar Exam Waivers sounds like free choice (“I have decided . . . and voluntarily assume”), but the language masks the reality: the examinees have no other choice but to submit to the demand that they give up, as Mississippi puts it, “valuable legal rights.”

Exploiting another party’s lack of choices is not always legal duress (consider payday loans), but duress does exist when one both limits a counterparty’s choices andthen also exploits their lack of options. That is what the bar examiners are doing here. They have both precluded an alternate pathway to licensure, and then they have exploited the fact that examinees have no other choice but to take the exam by demanding additional waivers of examinees’ legal rights as the entry price for the exam, the access to which the Board exclusively controls.

A third problem raised by the Bar Exam Waivers is that the exculpatory clauses might be legally unconscionable. A contract provision is unconscionable if (1) the party manifesting assent lacks input and choice with respect to the terms of the contract and (2) the particular contract term is substantively unfair. The Bar Exam Waivers arguably meet both requirements. They are textbook examples of contracts of adhesion—standard form, non-negotiable contracts crafted by the party with superior bargaining power and offered on a take-it-or-leave-it basis. Adhesion contracts are procedurally unconscionable, and their one-sided provisions are vulnerable to attack as unenforceable if such provisions “shock the judicial conscience” in their substantive unfairness. Although it is notoriously difficult to predict which terms will be found to be substantively unconscionable, requiring examinees to waive liability for personal injury resulting from being forced to take an in-person, two-day examination in the midst of a pandemic under conditions exclusively within the counterparty’s control may very well rise to that level of unfairness.

The context here is critical: the number of diagnosed COVID-19 cases in Kansas, North Carolina, and Mississippi are on the rise, and the U.S. Centers for Disease Control and Prevention (CDC) has warned against large-group meetings—especially those held indoors—over the course of several hours, and involving people from outside a local area, as creating the highest level of infection risk. During the twice-yearly licensing bar examination, hundreds of bar exam takers travel to an in-person testing site from all over the state and from outside of the state, and they sit together in a large room for more than six hours at a time for two days in a row. Is it shocking to require that people who must take that exam under these conditions both acquiesce to such testing circumstances and affirmatively waive all liability for resulting injuries—even if caused by negligent design of the testing environment? I think perhaps it is.

Moreover, the very fact that the KBE and other state bar examiners are concerned enough about their own liability to require an assumption of risk clause suggests that they realize an in-person exam is imprudent at this juncture. The practical and legal difficulties involved in administering the July 2020 bar examination in the midst of the COVID-19 pandemic were recognized and addressed by scholars months ago. Plus, there are other options for licensure available. For example, as Professors Merrit, Griggs, and Salkin explain in their recent article, “licensing candidates on an emergency basis through a diploma privilege, ‘diploma plus’ privilege, or supervised practice” would all be superior approaches to holding in-person exams or even re-designing the exam to be given online.

Even if contract law can be used to protect state bar examiners from liability in this situation (which, for the reasons articulated above, is unclear), I do not believe that contract theory justifies that result. Our legal system supports public enforcement of private contracts in order to promote efficiency and autonomy, but when contract terms are not freely chosen, enforcing those terms does not promote either of these goals. When two parties mutually agree to certain contract terms, the resulting contract is presumptively value-enhancing (a “win-win”). But when a stronger party simply imposes its will on another party who has no choice but to acquiesce to the stronger party’s demands, using the law to enforce these terms does not create societal or economic value. In the context of a powerful party forcing a less powerful party to acquiesce to non-negotiable terms, contract law becomes a tool of oppression. Free choice is and should be prerequisite for enforcement of contracts. Bar examiners seem to have forgotten that key legal point.

We expect our law school graduates to know and to fight for their clients’ contractual rights. How ironic it is that these same graduates are now being subjected to contractual abuse by the very body that seeks to license them to practice law.

Andrea J. Boyack is the Norman R. Pozez Chair of Business and Transactional Law, a Professor of Law, and Co-Director of Business and Transactional Law Center at Washburn University School of Law.

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