Landlord liability
For businesses that are resuming operations, a new set of protocols must be enforced to ensure the safety of their employees and the general public. Generally, premises liability law requires landlords to exercise reasonable care with respect to operating their property. Examples of exercising reasonable care include: (a) inspecting the property for obvious and latent defects/hazards; (b) warning tenants against latent defects; and (c) maintaining their property in a safe manner.
Although the COVID-19 pandemic is unprecedented, a landlord may be held liable for a number of issues as it relates to the COVID-19 pandemic such as: (i) failure to mitigate risks associated with potential exposure; (ii) failure to disclose potential exposure to COVID-19; (iii) failure to use best practices and guidelines set forth by the CDC and related agencies; and (iv) failure to communicate and encourage tenants to use best practices. Note, however, that a duty to investigate may not apply to COVID-19 because (1) the virus is airborne and (2) the CDC can offer only educated assumptions as to how it is transmitted.
A landlord can mitigate risks associated with operating during the COVID-19 pandemic by following all suggested best practices set forth by the CDC and related health agencies, which include:
- Follow all guidelines and recommendations set forth by the CDC and your state and local health officials, and instruct tenants to do the same;
- Conduct daily health checks while maintaining social distancing;
- Conduct periodic hazard assessments of the building to identify new or reoccurring hazards, especially for potential exposure to COVID-19, in accord with Occupational Safety and Health Administration (OSHA) guidelines;
- Implement policies and practices for social distancing in the building, including new procedures for using the elevator(s);
- Improve the ventilation system to reduce airborne exposures;
- Encourage tenants to require all sick employees to stay home;
- Place signs throughout the building to display CDC guidelines and recommendations; and
- Conduct enhanced daily cleaning of the building.
Past cases may provide meaningful insight
We can look to past cases to provide insight as to how courts may interpret landlord duty and liability during the COVID-19 crisis In Summers v. Giant Food Stores, Inc., 743 A.2d 498 (Pa. Super. Ct. 1999), the Pennsylvania Superior Court explained that a premises owner can be liable for harm caused to her business invitee if the owner: (i) knows, or by the exercise of reasonable care would have discovered, the condition, and should realize that it involves an unreasonable risk of harm to such invitees; and (ii) fails to exercise reasonable care to protect the invitees against the danger.
Further, any time a premises owner is in a position to obtain “superior knowledge” or information about a dangerous condition on the premises and fails to warn of such dangerous conditions, then such premises owner may be liable. Russell v. Alcoa Inc., 2010 Pa. Dist. & Cnty. Dec. LEXIS 678, *3-4 (C.P. Washington Cnty. 2010). To mitigate risks, landlords should maintain prompt and consistent communication with their tenants about potential exposure on the premises and continue to exercise reasonable care by inspecting the property for any latent defects and discoverable harm. See Cutler v. Dushoff, 192 Pa. Super. 37, 41-42, 159 A.2d 524 (1960). Note, however, that (i) any communications to tenants about potential exposure should take into account existing federal and state privacy laws; and (ii) although a landlord could request its tenant to disclose, the tenant has no duty to inform the landlord of any potential exposure to COVID-19.
Key recommendations for commercial landlords
- Monitor and follow all CDC, OSHA and related governmental agency guidelines.
- Review relevant lease provisions, which could include:
a. Building maintenance;
b. Janitorial services;
c. Utilities; and
- Environmental risks and liabilities. Create an action plan:
a. Implement all applicable suggestions and recommendations from the CDC, OSHA and your state and local health officials;
b. Communicate daily with tenants to encourage the use of “best practices” set forth by the CDC;
c. Perform daily health checks with tenants and their invitees, while still maintaining social distancing and respect for privacy laws (for example, under the HIPAA privacy rule, a “covered entity,” such as a health care provider, may not disclose a visitor’s or patient’s identity to its landlord or other third party without first obtaining written authorization);
d. Enhance daily cleaning of the building;
e. Place signs throughout the building to encourage tenants, their employees and invitees to follow all CDC guidelines;
f. Create new protocols for use of elevators in the building; and
g. Provide sanitizing stations for the common areas of the building.
- Review insurance policies.
- Inspect the building to ensure that mold is not present and Legionella and other bacteria have not grown in the building’s plumbing systems as a result of prolonged vacancy during the pandemic.
- Communicate with all tenants should any potential exposure of COVID-19 occur.
- Ensure that your action team is prepared to consult with local health authorities should an outbreak occur at the building.
Conclusion
As cities start to reopen, it is imperative that landlords create an action plan to mitigate any risks associated with reopening their building. In his article “Understanding the Touchless Workplace,” Lee Billington, director of connected experiences at Gensler, explained that “the coronavirus has us evolving our perspective of the frictionless workplace … [and w]hen we return to our physical workplaces, we need to rethink how we introduce interfaces that aren’t just frictionless, but also touchless.” The responsibility to create a touchless workplace will in some part fall on the property owner, whether that includes overseeing new construction by the tenant to create this environment or by designing new protocols for accessing elevators. The key recommendations and best practices listed above provide guidance as to how landlords should get started.
Reed Smith’s real estate attorneys can assist you in evaluating best practices as they relate to reopening your building. Please contact us to request a consultation and/or evaluation.
Our Reed Smith Coronavirus team includes multidisciplinary lawyers from Asia, EME and the United States who stand ready to advise you on the issues above or others you may face related to COVID-19.
For more information on the legal and business implications of COVID-19, visit the Reed Smith Coronavirus (COVID-19) Resource Center or contact us at COVID-19@reedsmith.com.
Client Alert 2020-418
