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Can CRE Landlords Be Held Liable for COVID-19 Exposures?

Jan 19, 2021 by Marc Rapport
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Lawsuits are now popping up where people are suing their employer for exposure to the deadly virus that causes COVID-19. But what about landlords who own commercial properties where employees were exposed? Can they be held liable?

The short answer: perhaps, but not necessarily. While pretty much anything can happen in a lawsuit, and there's much precedent yet to be set and followed as such questions get raised, there are some legal standards that can help guide an investor's response to that challenge.

To find out more, Millionacres asked some experts on the issue of landlord liability for their advice and recommended best practices. Here's what they had to say.

Liability to the extent that the property owner maintains control: Keep things clean

Micah Longo is the managing attorney for The Longo Firm, a civil trial lawyer firm in Davie, Florida, that handles personal injury and employment law cases. He said:

"The extent of responsibility for injuries occurring on a property during a commercial lease depends upon the extent to which the owner of the property maintains control over the property, which is alleged to have been the cause of injuries suffered.

While a property owner/landlord will not be responsible for injuries caused solely by the tenant's operations and activities on leased premises, the property owner may still be liable to the public where the landlord has responsibility or maintenance, inspection, or oversight under the terms of the lease.

The fact that there may be joint responsibility or control over the premises does not relieve a landlord from responsibility to maintain the premises in a reasonably safe condition. In the context of COVID-19, what would be maintaining the property in safe condition would be ensuring that there is plexiglass and that customers/visitors are socially distanced and wearing masks.

Basically, following CDC guidelines establishes what is the standard, and if landlords don't follow that established standard of care and someone gets hurt, the landlord could be responsible for the harm."

Get signed waivers and again, control what you can

Evan Walker is a personal injury and property damage attorney in La Jolla, California. He said:

"COVID-19 exposure is arguably a type of premises liability and generally is state law-specific. But there are some steps CRE operators can take to protect themselves.

First, ask or require tenants to sign a COVID-19 waiver. Generally, these waivers should be upheld unless an operator commits gross negligence (e.g., knowingly exposing tenants to the virus).

Second, take proactive steps such as cleaning and notifying the tenants about the dangers of COVID-19 and best practices in regard to slowing the spread (e.g., limit gatherings and inform tenants that the operator follows state law in regard to COVID-19)."

Owner/operators should know what their tenants are doing

Rob Olson is senior counsel in San Diego with Tyson & Mendes, a litigation firm that specializes in insurance defense. He said:

"The first question in evaluating a lawsuit over COVID exposure: Where did the plaintiff allege they were exposed? If it was at work, in a tenant's office space, then it is outside the property owners' control. But if the plaintiff alleges that they were exposed in a common area, then the property owner may not easily get out of the lawsuit.

Nevertheless, proving the 'where' will be the hurdle for the plaintiff. The plaintiff must show with a degree of certainty that they contracted COVID-19 from the property owner in a common area -- not from their employer, or dinner with parents or friends, or at a restaurant, etc. So far, no case law defines what is needed for this degree of certainty.

A landlord/property owner can protect themselves by instituting controls that protect individuals (including invitees, licensees, and even trespassers) against the spread of COVID-19 in their property's 'common areas,' including lobbies, elevators, elevator banks, hallways, swimming pool, laundry area, playgrounds, exercise rooms, dog areas, smoking areas, etc.

These controls should be based on the current known science proffered by the local and federal guidelines (whether they agree with them or not), and can include posting signs, requiring masks, increasing ventilation and airflow, limiting occupancy in an area, providing spacing cues on floors, and prohibiting unnecessary areas (swimming pools and workout areas). Of course, if these practices are not documented, then in a courtroom, they do not exist.

Landlords should not have to police their policies actively -- but likewise, they cannot ignore people who violate the property owner's guidelines. Tenants also have an obligation and responsibility to keep the unit safe, sanitary, and maintain it. This should also mean the tenants must reasonably comply with state and federal policies -- it will help the landlord if they notify their tenants of their respective responsibilities with COVID and document it accordingly."

The Millionacres bottom line

As a CRE landlord, you're likely only liable for what you have direct control over. If you follow best practices and CDC guidance about cleaning, for instance, if that's within your purview, you should be fine. But don't take anything for granted either.

For instance, how and when the COVID-19 vaccine can be mandated remains to be seen. It behooves you as the property owner/manager to be aware of your tenants' activities and adherence to guidelines.

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