PREMISES LIABILITY UPDATE

1
PREMISES LIABILITY UPDATE

• GREGORY G. JONES
• State Bar of Texas-Litigation Update Institute
• February, 1998
• Russell, Turner, Laird Jones
• Fort Worth and Dallas, Texas

2
CHANGE IS IN THE AIR

• PREMISES LIABILITY AND SECURITY CASES
• Legislative Proposals/Judicial Review
• The Question of Duty
• The Question of Control
• The Question of Proximate Cause
• The Question of Foreseeability

3
Introduction-Trends in Texas and Across the
Country

• Tougher Juries
• Tougher Judges
• Tougher Laws
• Tougher Insurance Companies and Defendants

4
Topics of Discussion

• Trends in Settlements and Verdicts
• Trends in the Common Law
• Trends in Statutory Law
• Trends in the Behavior of Insurance Companies and
  Defendants

5
Lefmark Management Company v. Old, 946 S.W. 2d 52
(Tex. 1997)

• Justice Owens concurring opinion.
• 1998 is here and so is Timberwalk Apartments,
  Partners, Inc. et al. V. Cain, No. 97-0457. 41
  Tex. Sup. Ct. Jour. 1138

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Duty

• A landlord who maintains control over the safety
  and security of the premises owes a duty to use
  reasonable care to protect tenants against
  unreasonable and foreseeable risk of harm from
  the acts of third parties. Centeq Realty v.
  Seigler, 899 S.W. 2d 195 (Tex. 1995)

7
Premises Liability and Criminal Acts of Third
Parties

• The area of most significant developments in
  premises liability.
• The slip and fall case.
• General Contractors and Independent Contractors

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THE NO DUTY RULE

• There is no duty and therefor no liability
  without first establishing that there was a
  foreseeable risk of harm from the acts of third
  persons. Centeq, at p. 197
• Also noted in Lefmark, at p.53.
• Yet again in Timberwalk at p. 1143 of the Tex.
  Sup. Ct. Jour.
• NOTE Duty is closely related to the issue of
  CONTROL.

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CREATING DUTY

• By an affirmative act on the part of a party
  (creation of a hazard)
• Employment / relationship of parties
• Foreseeability of an incident or occurrence
• Control over premises and/or activity
• Statutory Duty
• Restatement

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STATUTORY DUTY

• Section 95.003 of Tex. Civ. Prac. Rem. Code
• Premises defect cause of action where there is
  injury to contractor, subcontractor, or an
  employee of same, which results from failure to
  provide a safe workplace.
• Requires actual knowledge on part of owner of
  condition resulting in death, injury, damage

11
Statutory Duty

• 1995 legislation
• Subchapter D, Security Devices, Texas Property
  Code
• Section 92.153 Landlord required to provide
• Section 92.157 Tenant Requested Devices
• Section 92.158 Repair/Replace security devices
• BUT NOT IN INADEQUATE SECURITYCASES!!

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NO STATUTORY DUTY??

• was in intended to govern disputes disputes
  between landlord and tenant over repairs and not
  liability for personal injuries resulting from
  premises defects actionable under the common
  law. Timberwalk at pp. 1141-42.
• does not apply in a personal injury case and
  should not have been included in the charge.

13
Statutory Duty Does Not Limit Other Rights of
Tenant

• The tenant still has rights under the common law,
  or under other right, to bring an action and that
  is unaffected by the changes in the Property
  Code. Moreno v. Brittany Square Associates,
  L.P., 899 S.W. 2d 261 (Tex. App. --Houston 14th
  Dist. 1995, writ denied)

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THE RESTATEMENT (SECOND) OF TORTS

• Section 343 adopted by the state of Texas.
• One who posses land will be subject to liability
  for physical harm to invitees by a condition the
  party knows or reasonably should have known
  existed and was an unreasonable risk of harm.
  Papania v. Stelly, 939 S.W. 2d 653 (Tex. App.
  --Beaumont 1997, no writ)

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Duty and Foreseeability

• Whatever duty a lessor may have to protect
  persons injured on the leased premises against
  the criminal acts of third parties, that duty
  does not arise in the absence of a foreseeable
  risk of harm.
• Walker v. Harris, 924 S.W. 2d 375 (Tex. 1996)

16
The Requirement of a Duty

• Liability in tort requires that a duty must exist
  and a duty must be violated
• See, Centeq, at p 197 and Greater Houston Transp.
  Co. v. Phillips, 801 S.W. 2d 523, 525 (Tex. 1990).

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Duty

• Whether a duty exists is a question of law for
  the court to decide. Timberwalk at p. 1143.
• If there is a duty is a question to be decided by
  the court as a question of law based on
  surrounding facts.

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The Duty in all Premises Cases

• A landowner who has control of the premises must
  use reasonable care to make a premises safe for
  business invitees

• Invitees must be warned of hidden dangers that
  present a risk of harm.

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Duty and Creation of Dangerous Situation

• Where the dangerous situation is created by a
  party and it is reasonable that the party should
  foresee that others may be injured when
  exercising their lawful rights, then a DUTY
  arises to take steps to prevent the injury or
  damage. Jacobs-Cathy Co. v. Cockrum, __ S.W. 2d
  __, W.L. 292622 (Tex. App. - Waco 1997, no writ)

20
General Information on Inadequate Security Cases

• Liability Consultants Study
• Sudbury, Massachussetts
• Mr. Norman Bates and John D. Groussman

21
Types of Crimes

• 39.45 Assault and Battery
• 26.97 Rape/Sexual Assault
• 15.41 Wrongful Death (Murder)
• 10.28 Robbery
• 4.04 Other
• 3.85 False Imprisonment

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Where Crimes are Occurring

• Parking Lots
• Stores
• Apartment Units
• Interior Common Area
• Exterior Common Area
• Bar
• General Commercial

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Type of Businesses Sued

• Apartment Complex
• Restaurant
• Retail Store
• Security Contract Company
• Bar
• Property Management Company

• Governmental Entity
• Hotel/Motel
• Supermarket
• Shopping Center
• Other Commercial Industry
• School
• Convenience Store/Gas Station

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Case Results Study 1993-1995

• 51.91 Defense Verdict
• 19.49 Remanded
• 17.30 Plaintiff Verdict
• 11.29 Settled

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ELEMENTS OF THE CAUSE OF ACTION

• CONTROL OF THE PREMISES
• Centeq v. Siegler, 899 S.W. 2d 195 (Tex. 1995)
• The right to control the premises is one of the
  factors that determines whether a legal duty
  should be imposed on the owner or possessor of
  the property. Id at 197
• There is still a question over the extent and
  nature of control needed.

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CONTROL

• Lefmark Mngmnt Co. v. Old, No. 95-0983, May 16,
  1997, TxSCt.
• A former property manager does not have any duty
  to prevent the criminal acts of others when the
  manager did not own, occupy or control the
  property on the date of the incident
• BUT...

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WATCH FOR THE PROGENY OF LEFMARK

• Justice Owen Concurrence
• I do not intend to convey the impression that
  those articulations (the Lefmark majority
  opinion) have fully defined the extent of the
  duty owed by an employer, landlord, business
  owner, or possessor of property when the danger
  of injury or death from a violent criminal act
  is, in a legal sense, foreseeable.
• Responsibility of law enforcement for police
  protection

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What Kind of Control?

• Cain v. Timberwalk Apartments, 942 S.W. 2d 697
  (Tex. App.- Houston 14th Dist. 1997.

• a landowner or apartment manager has a duty to
  use ordinary care to protect against an
  unreasonable and foreseeable risk of harm from
  the criminal acts of third parties

29
Control Over the Activity Causing Injury

• Specific control over the injury causing
  activity, was necessary to impose vicarious
  liability. Ely v. General Moters Corp., 927
  S.W. 2d 774 ( Tex. App. - Texarkana 1996, writ
  denied)
• NOTE Lefmark does not seem to mandate control
  over specific aspects of safety and/or security.
  Compare to the more limited view of Exxon.

30
Adjacent Property

• The Duty to protect invitees and licensees from
  the criminal acts of third parties extends of
  those premises adjacent to public walkways.
  Silva v. Spohn Health System Corp. 951 S.W. 2d 91
  (Tex. App. --Corpus Christi 1997, no writ)

31
Control Lessors and Franchise Operations

• Exxon v. Tidwell, 867 S.W. 2d 19 (Tex. 1993)
  inquiry must focus on who had specific control
  over the safety and security of the premises,
  rather than the more general right of control
  over operations.

• Note This is a case where an employee of the
  lessee was injured
• Exxon was merely the Lessor of the gas station
  and had a sales agreement with lessee
• Restrictions and standards to protect their name
  and profits

32
Control Lessors and Franchise Operations

• Exxon v. Tidwell, 867 S.W. 2d 19 (Tex. 1993)
  inquiry must focus on who had specific control
  over the safety and security of the premises,
  rather than the more general right of control
  over operations.

• Note This is a case where an employee of the
  lessee was injured
• Exxon was merely the Lessor of the gas station
  and had a sales agreement with lessee
• Restrictions and standards to protect their name
  and profits

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HOW TO ATTACK ISSUES OF CONTROL

• Distinguish employee situations with guests
  and/or business invitees on the premises
• Look for any aspect of control in franchise
  agreements which give the franchisor control over
  the franchisee
• Identify any aspects of the agreement/s between
  the lessor-lessee/franchisor-franchisee which
  address issues of safety, security.

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APPARENT AGENCY

• Restatement (Second) Agency Section 267
• One who represents that another is his servant
  or other agent and thereby causes a third person
  justifiably to rely upon the care and skill of
  such apparent agent is subject to liability to
  the third person for harm caused by the lack of
  care or skill of the one appearing to be a
  servant or other agent as if her were such.
  (Actual reliance is required)

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FRAUD

• The elements of common law fraud based upon the
  actions and representations of a franchise
  operation
• How do they hold themselves out to the public?
• Do they want the public to think the operation
  is another operation controlled by the national
  company with the national name that is franchised?

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Franchise Agreements and Agency

• Texas courts have held that franchise agreements
  dont create agency relationship
• Requiring corporate standards to be followed does
  not translate into day to day control. If no such
  control then no liability under theory of agency
  for an employer, particularly where no mention of
  employee screening procedures.

37
Smith v. Foodmaker, Inc.

• 928 S.W. 2d 683 (Tex. App.-Fort Worth 1996, no
  writ)

38
REASONABLE FORESEEABILITY

• NO DUTY RULE
• PRIOR SIMILAR INCIDENT RULE
• TOTALITY OF THE CIRCUMSTANCES

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The Rule in Texas Modified Totality of the
Circumstances?

• Before a duty arises on the part of the
  landowner, occupier or controller, there must be
  foreseeability
• As applied to the issue of duty foreseeabilty is
  an issue of law for the court while it is a
  question of fact as applied to proximate cause.
  Exxon Corp. v. Tidwell, 816 S.W. 2d 455 ( Tex
  App.-Dallas, 1990) rev on other grounds, 867
  S.W. 2d 19 (Tex. 1992)

40
TOTALITY OF THE CIRCUMSTANCES

• Nixon v. Mr. Property Mgt. Co., 690 S.W. 2d 546
  (Tex.1985) Criminal history in the area in
  general, not only the specific property, is
  relevant to foreseeability, as is the flavor of
  the area.
• BUT COMPARE...

• Walker v. Harris, 924 S.W. 2d 375 (Tex. 1996)
  Plaintiff did not bring sufficient summary
  judgment evidence to raise fact issue where
  apartments in area of low to moderate crime no
  previous similar incidents

41
Timberwalk and Prior Similar Incidents

• A duty exists only when the risk of criminal
  conduct is so great that it is both unreasonable
  and foreseeable. P. 1143
• what the premises owner knew or should have
  known before the criminal act occurred. p.1143
• must be evidence that other crimes have
  occurred on the property or in its immediate
  vicinity. p. 1143

42
Timberwalk

• The previous crime must be sufficiently similar
  to the crime in question as to place the
  landowner on notice of the specific danger. p.
  1144.
• Actual notice and knew or should have known.
• No Duty to ...regularly inspect criminal records
  to determine crime in area. (p. 1145)

43
Timberwalk and Submission to the Jury

• The Court did not err in charging the jury as a
  premises liability case rather than as negligent
  activity claim.
• Focus on the activity.

44
Timberwalk

• Proximity
• Recency
• Frequency
• Similarity
• Publicity
• All of the above must be considered to determine
  foreseeability of criminal conduct.

45
UNDER THE HEADING OF ITS OK TO FIGHT BACK

• Phuong Anh Thi Truong and Duc La v. Sears Roebuck
  et. al. ( Ct. App.- 1st Dist, Houston No.
  01-95-00683-CV, March 13, 1997)
• Duty does not arise until risk of injury
  foreseeable
• Affidavit of owner saying he was not aware of
  criminal activity or acts not enough where the
  test is whether he knew or should have known of
  previous assaults
• The Plaintiff was not responsible for her own
  injuries because she fought back. Against public
  policy to decide otherwise.

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DAMAGES

• POST TRAUMATIC STRESS DISORDER (PTSD)
• Recognized as a diagnosis by DSM-IV
• Recognized as a diagnosis by nearly all
  psychologists and psychiatrists
• RAPE TRAUMA SYNDROME (RTS)
• Not recognized as a diagnosis criteria by the
  DSM-IV
• controversial
• Term coined by Dr. Ann Burgess
• Combine with a PTSD diagnosis as primary
  diagnosis.
• Robinson and Havner ?