CREJ - page 4

Page 4
— Property Management Quarterly — August 2015
I
t’s a sunny day outside of
ABC office building. Patrons
are coming and going to and
from the building; business is
booming. It is a wonderful and
prosperous day until Johnny, leav-
ing the dentist office, trips over an
uneven sidewalk. Johnny is taken to
the hospital where he is diagnosed
with a broken leg, which takes
months of rest and physical therapy
to heal. Johnny misses a signifi-
cant amount of work due to this
injury and suffers from depression
because the injury costs Johnny
thousands of dollars – so he sues
the building owner, dentist (ten-
ant), property manager and anyone
else he can find under the theory of
premises liability to recover his lost
wages and any other damages that
he may be lucky enough to collect.
When a person sustains injuries
due to a condition, activity or cir-
cumstance existing on a property,
that person can sue the landowner
of the property under the Premises
Liability Act. However, under the
Premises Liability Act, “landowner”
does not exclusively mean the
person who legally owns the land.
Rather, landowner means the per-
son or agent who has possession of
the property and is legally responsi-
ble for the conditions, activities and
circumstances existing on a proper-
ty. Depending on the situation, the
landowner could be anyone from
the landlord or the property man-
ager to the property management
company or even the tenant.
In a recent Colorado Supreme
Court case, Jordan v. Panorama
Orthopedics &
Spine Center PC,
the court deter-
mined whether
a specific tenant
could be held liable
for injuries occur-
ring on the prem-
ises. In the case, a
woman fell on an
uneven sidewalk
while walking to
meet her hus-
band after receiv-
ing treatment at
the Panorama
Orthopedics & Spine Center at the
Panorama Medical Campus. From
this fall, the woman fractured her
orbital bone and sustained a con-
cussion. The injured woman sued
Panorama Orthopedic & Spine Cen-
ter, a tenant of the building, under
the Premises Liability Act. How-
ever, since the woman tripped over
sidewalk in a common area, the
Colorado Supreme Court needed to
determine if Panorama, as a tenant,
could be held liable in this situa-
tion.
Ultimately, the court determined
that Panorama was not liable for
the injuries to the injured woman
under the act. The court came to
this conclusion because Panorama
was not in exclusive possession and
control of the common area. The
landlord retained responsibility for
the conditions of common areas,
and Panorama was not legally
responsible for the activities con-
ducted in the area where the inju-
ries occurred.
Takeaways for
Landlords
The court’s deci-
sion limits the cir-
cumstances under
which the tenant
can be held liable
under the Premises
Liability Act. Unless
a tenant has at
least some exclu-
sive possession over
an area and the
legal responsibility
to make repairs to
that area, the ten-
ant likely will not be held liable. Even
indemnity clauses in leases will not
be able to protect landlords. Accord-
ingly, landlords need to consider the
following precautions.
Give control and possession of com-
mon areas to a major tenant.
In order
to avoid liability for injuries sustained
on the premises, landlords may find
it beneficial to give control of mainte-
nance and upkeep of common areas
to a major tenant.When doing this,
it is very important to ensure that a
lease specifies that the tenant will be
responsible for all conditions, repairs
and maintenance on all areas of the
property.
Limit liability with lease provisions.
While there are few lease provisions
that will prevent liability for injuries
sustained on the premises, there are
lease provisions that will limit liability
in the event that a tenant’s patron
gets hurt while on the property.
Ensure that a lease has an indemnity
clause and ensure that the lease spec-
ifies what areas are the responsibility
of the tenant to maintain.While these
clauses will not eliminate the amount
of liability risk, they do help limit the
instances that a landlord will be liable.
Ensure the premises are maintained.
One of the best ways to avoid liability
for injuries sustained on the premises
is to ensure that no hazardous condi-
tions exist on the property. Constant
inspection and repairs to eliminate
hazardous conditions can be expen-
sive. Thus, it may be a good idea to
have maintenance and repairs includ-
ed in a lease as additional rent. This
way the financial burden of maintain-
ing the property does not rest solely
on the landlord.
Be knowledgeable about the condi-
tion of the property.
Another way to
avoid liability for injuries sustained on
the premises is to be actively involved
in the inspection of the premises.
While it might be included in a lease
provision that the tenants should
notify the property manager of dan-
gerous conditions on a property, that
lease provision is unlikely to protect
the property manger or the landown-
er from liability for damages following
an injury on the property even if the
tenant failed to report. As such, it is
a good idea to inspect the property
regularly.
Ultimately, this Colorado Supreme
Court decision shows that landlords
are responsible and should take
precautions to avoid liability under
the Premises Liability Act. Strong
lease language, regular inspections
and repairs have never been more
important.
s
Legal
Donald “Corky”
Eby
Attorney, Robinson
and Henry PC,
Castle Rock
Kayla Weeres
Law clerk,
Robinson and
Henry PC,
Castle Rock
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