CREJ - Property Management Quarterly - April 2016
This is the first in a series of articles that deal with commercial real estate management, leasing and landlord- tenant issues. As a property manager, it is important to discuss with legal counsel potential liability issues that rear their heads on a regular basis and then inform ownership and receive their input. Did you know that according to the Insurance Information Institute, dogs bite about 4.5 million people every year in the U.S.? When I read this statistic and thought about the trend in which employees are allowed to bring their dogs into the workplace, I called Amanda Halstead. I received the following informative responses and great counsel. Sessions: Is there any liability for a property owner to allow tenants to bring their dogs to work? Halstead: As is typical of my profession, I must answer that question with the words, “it depends.” Generally speaking, a property manager would not be liable for an injury inflicted by an animal that does not belong to the property manager. If, however, he knew or had reason to know that the dog was dangerous, the property manager could be held liable for damages, even punitive damages. In Vigil ex. rel. Vigil v. Payne, 725 P.2d 1155 (Colo. App. 1986), the court held that by leasing the premises to tenants with a dog known to be threatening, the landlord knowingly created a “clear potential for injury” and was held liable. C.R.S. Section 13-21-115, the Colorado Premises Liability Statute, provides a mechanism through which a manager could be held liable. This statute generally provides that the manager may be liable for its “unreasonable failure to exercise reasonable care with respect to dangers of which the landlord actually knew or should have known.” Irrespective of whether a property manager or building owner ultimately will be found liable for injuries caused by a tenant’s dog, they should anticipate being named as a party in any lawsuit initiated in connection with an injury occurring on the property. Before allowing dogs on the property, I would recommend that the manager confirm that the liability insurance policy provides coverage for injuries caused by dogs. I also would recommend including language in the leases that require the tenant to do the same, with policies naming the building owner and manager as an additional insured. Policies should be carefully reviewed to confirm whether any particular dog breeds would be omitted from coverage. Sessions: I have heard that Colorado has a “one dog bite rule.” Is that true and how does this apply to owners of commercial properties? Halstead: The “One Bite Rule” is sometimes known as the “First Bite Rule” or the “First Bite Free Rule.” The idea behind this rule is that an owner should not be liable for any injuries caused to the first victim of his or her dog. There is, however, no such rule shielding pet owners from injuries caused by a dog’s first bite in the state of Colorado. Instead, C.R.S. Section 13-21-124 provides that a person who suffers serious bodily injury may bring a civil action to recover economic damages against the dog’s owner regardless of the dog owner’s knowledge or lack of knowledge of the dog’s viciousness or dangerous propensities. In Colorado, a pet owner is strictly liable for the acts of his pets. In other words, he is liable for injuries caused by his pet, regardless of whether he knew or had any reason to know that the dog might injure someone. These concepts generally apply to dog owners, as opposed to property managers of tenant’s with dogs. Sessions: Are there any dogs that cannot be brought into the workplace? I understand that Aurora does not allow pit bulls. Halstead: Any manager who permits dogs on site should consider instituting rules and regulations in connection with such consent. Those rules and regulations should prohibit any breeds that are not permitted under any applicable laws, codes or ordinances, including any city ordinances. Moreover, those rules should prohibit any breed that might be omitted from coverage under the property manager or tenant’s general liability policy. Any such rules should be uniformly enforced and should include, without limitation, a requirement that all pets comply with any and all applicable laws, including any pet licensing requirements and that any pets be up-to-date on their vaccinations. Sessions: Any other considerations that a property manager and ownership should be aware of? Halstead: Temperament and liability are not the only factors that should be considered by a manager. A manager should keep in mind that not all tenants, invitees and customers are dog lovers. Moreover, some of those folks may be allergic to dogs or have a fear of dogs. Also, a manager can anticipate increased costs in connection with the removal of pet waste, which might be offset by the charging of pet rent. The manager might want to reserve the right – at any time and for any reason or no reason at all – to remove a particular dog from the property or to revoke all tenants’ rights to have dogs on site. Putting clear rules and guidelines in place at the outset is an absolute must for any property manager should a manager elect to permit pets on site.