Walker Bank & Trust Co. v. First Security Corp.

CALLISTER, Justice

(dissenting).

I dissent for the reason that the “hold harmless” clause contained in the “Sight Draft Authorization” is valid and precludes recovery by respondent.¹

Many jurisdictions have held similar exculpatory provisions void as against public policy, some by virtue of a statute to that effect.² Neither this court, nor our legislature, has expressly declared such provisions to be against the public policy of this state.³

In the instant case the exculpatory provision was not inserted in the document at the bank’s insistence. On the contrary, the bank had no part in its drafting. Mrs. Gallagher signed it in Texas and forwarded it to the bank in Spanish Fork, Utah. Having signed the authorization, she was charged with the knowledge of its provisions.

The exculpatory clause certainly covered the bank’s negligent acts. To hold otherwise would render it meaningless.⁴ Furthermore, the “Sight Draft Authorization” including the “hold harmless” clause was supported by consideration. The bank agreed to perform a service over and beyond its normal obligations to a depositor.⁵

1 . Restatement of Contracts §§ 574, 575.

2 .. 175 A.L.R. 8 et seq.

3 .See dicta in Jankele v. Texas Co., 88 Utah 325, 54 P.2d 425.

4 . 175 A.L.R. § 8, p. 18.

5 . Restatement of Contracts § 75.