Landlords may now be liable for accidents that occur on the premises of property rented to tenants if there has been an entry of an unlawful detainer judgment but the tenant has not yet been evicted. The California Court of Appeal has recently issued an opinion that behooves landlords to inspect property as soon as an unlawful detainer judgment is entered. This is in contrast to the usual practice of waiting until a property has returned to the landlord's possession to inspect the property.
'A New Rule of Law'
The decision of the California Court of Appeal, 2nd Appellate District, is a "new rule of law" according to the sole dissenting justice. The majority decision in the recent California case, Stone v. Center Trust Retail Properties, Inc., 2008 DJDAR 7871, held that, upon entry of an unlawful detainer judgment for possession of real property, a landlord now has a duty to inspect the premises and to conduct reasonable periodic inspections of the premises thereafter. This holding clearly expands the scope of the duties of landlords to their tenants' invitees. Prior to this case, landlords had a duty to act reasonably to correct defects they knew, or should have known, about. They did not, however, have an affirmative duty to inspect the premises upon the entry of an unlawful detainer judgment for possession of the premises. Thus, landlords who had commenced an unlawful detainer action often waited to inspect a property until they recovered possession of the premises, either after the tenant had vacated the premises or had been removed by a sheriff.
In Stone, the plaintiff sued for an injury resulting from a slip and fall caused by a water leak. She sued both the owner of the restaurant in which she was injured (Gumboz Creole Cajun restaurant) and the owner of the retail mall that leased the premises to the restaurant (Center Trust Retail Properties Inc.). Based on the evidence presented at trial, she had slipped on water on the floor, which was a result of a water leak. Prior to the accident, the landlord had brought an unlawful detainer action against the tenant for nonpayment of rent and obtained a judgment for possession of the premises. Although the landlord had obtained a writ of possession of the premises before the accident occurred, the sheriff had not yet served the writ and the tenant was still occupying the premises. The jury found the tenant 65 percent responsible for the plaintiff's injuries, landlord 19 percent responsible and the plaintiff herself 16 percent responsible. The landlord appealed the judgment.
Expanded Liability
In its opinion, the Court of Appeal first discussed the duty of landowners, including landlords, to use reasonable care to protect people who come onto their property. Reasonable care usually requires landlords to ensure that the property is safe at the beginning of the tenancy and to repair any hazards that the landlord learns about later. The court stated that limiting the duties of landlords to their tenants' invitees enabled their tenants to enjoy the premises without potentially intrusive oversight of the premises by the landlords. The court stated that, for a landlord who has relinquished possession of the premises to a tenant to be liable for a dangerous condition on the premises, a plaintiff must show that the landlord had actual knowledge of the dangerous condition, as well as the right and ability to cure the dangerous condition.
The Court of Appeal then distinguished the instant case, stating that a landlord who is in the process of evicting a defaulting tenant "unsettles their relationship" and requires a "rebalancing of their rights and duties." It described the situation as a "hybrid ... lying between the limited duties of a non-possessory landlord and the greater duties of an occupying landowner." It found that the trial court had not adequately defined the landlord's duty to the plaintiff not only to act reasonably to correct defects it knew, or should have known about, but also to inspect the premises upon the entry of an unlawful detainer judgment for possession of the premises and to conduct reasonable periodic inspections of the premises thereafter.
The court further found that the landlord had not just the duty, but also the right, to inspect the premises. In support of this finding, the court cited the case Martinez v. Bank of America, 82 Cal.App.4th 883 (2000), and stated that the opinion in that case implied that a landlord has both the right and the duty to inspect the premises over the tenant's objection upon entry of a judgment of possession. The court also stated that the lease in this case expressly gave the landlord the right to inspect the premises if the tenant defaulted. The Court of Appeal then remanded the case to the trial court and stated that, during the retrial, the parties could present evidence as to whether a reasonable inspection upon entry of the judgment or any later inspections would have discovered the water leak that caused the plaintiff's slip and fall.
The dissenting justice stated that, in holding that the landlord's duty to third parties - such as the plaintiff - included the duty to inspect the premises even though the tenant was still occupying the premises, the majority expanded the law to create a new legal duty on the part of landlords. He further stated that the California Legislature is the proper entity to consider the proposed realignment of the relationship between landlords and tenants, including a consideration of factors such as the potential increase in public safety that would result from the landlords' additional duty and the costs of requiring landlords to spend more time and resources in inspecting their tenants' premises after obtaining judgments for possession of the premises but prior to the actual eviction of the tenants from the premises.
Based on the reasoning of the Court of Appeal, landlords and property managers should make sure that their leases include a provision allowing the landlord to inspect the premises and that their tenant eviction process includes a requirement for inspection of the premises upon obtaining judgment in any eviction proceeding.
Landlords should not wait until they take possession of the premises after the tenant has vacated or has been removed by a sheriff pursuant to a writ for possession to inspect the premises. Landlords should also make it their practice to inspect the premises when they suspect that the tenant may not be properly maintaining the premises.
This case did not specifically address the issue of whether it is, in general, a landlord's, rather than a tenant's, responsibility to correct defects on the premises.
For commercial tenancies such as the one involved in this case, the responsibility for repair and maintenance is usually governed by the language of the lease. However, even if the lease states that it is the tenant's responsibility to repair and maintain the premises, once the landlord knows or should know of a defect on the premises, the landlord must act reasonably to correct that defect.
Although a tenant has a right to quiet enjoyment of the premises during the tenancy, when the landlord suspects that the tenant may not be properly maintaining the premises or when an unlawful detainer judgment has been entered by a court for possession of the premises, the landlord should inspect the premises.
If the landlord does not do so, and therefore does not discover a defect on the premises, the landlord may still be liable for damage or injury that results from the defect if a court determines that the landlord should have known of the defect.
A court could make such a determination by finding that the landlord had the right to inspect the premises, whether based on a provision in the lease giving the landlord the right to do so, or based upon the entry of an unlawful detainer judgment for possession, and that a reasonable inspection of the premises and any later inspections would have discovered the defect.
Sandra Herrera is an associate in the real estate practice group and can be reached at sherrera@nossaman.com. Both are based in the firm's Los Angeles office.