• Commercial Tenant Found To Not Be a “Landowner” Of Common Areas Under Colorado’s Premises Liability Act
  • April 27, 2015 | Author: Christina M. Gilbertson
  • Law Firm: Wood, Smith, Henning & Berman LLP - Highlands Ranch Office
  • Why This Case is Important

     In this case, the Colorado Supreme Court considers whether a clinic that was the main tenant at a medical campus qualifies as a “landowner” (as defined by the Premises Liability Act - the “PLA”) of a common area sidewalk where the Plaintiff fell and sustained injuries. The Court determined that the clinic was not a “landowner” of the common area sidewalk because it had only a right of non-exclusive use of the sidewalk and the landlord retained responsibility for maintaining the area. The Supreme Court emphasized that the public passing through common areas to access a tenant’s business does not necessarily mean that the tenant is conducting an activity in the common areas.

    Facts of the Case

    Barbara Jordan sued Panorama Orthopedics & Spine Center, PC (“Panorama”) for premises liability and negligence. After receiving medical treatment at Panorama, Jordan was walking to the parking lot when she tripped over uneven sidewalk slabs near Panorama’s main entrance. Jordan fell to the ground, suffering an orbital (eye socket) fracture and a concussion.

    Panorama is a large orthopedics clinic that receives over 100,000 patient visits each year. Panorama operated out of a single building which had a sign bearing Panorama’s name, although there were three other tenants in the building who provided supplemental medical services to Panorama’s patients. Panorama was the largest tenant in the building and operated a reception desk for the entire building. Under its lease, Panorama also had 25 reserved spaces in the parking lot for its exclusive use.

    Panorama’s lease defined the leased “Premises” as the space within the building occupied by Panorama. The lease defined “Common Areas” as those areas provided by the landlord for the non-exclusive use of the tenants including, but not limited to, sidewalks. The lease required that the landlord maintain the sidewalks, although Panorama was permitted to provide emergency repairs if the landlord failed to do so. The lease also stated that Panorama “assumes all risk of damage to property or injury to persons in, upon or about the Premises from any cause,” and Panorama agreed to indemnify the landlord for any claim related to the tenancy.

    The Ruling

    The PLA limits a landowner’s potential liability for an injury occurring to another on his property to instances when such injuries occur as a result of some condition of the landowner’s property, or as a result of activities conducted on the landowner’s property. The PLA is meant to define what duties a landowner owes to others because of his legal capacity as a “landowner,” as defined by the PLA. Under the PLA, a person/entity is considered a “landowner” if:
    1. It is in possession of real property; or
    2. It is legally responsible for the condition of real property, the activities conducted on real property, or the circumstances existing on real property.
    At the outset, the Supreme Court said that Panorama was not in possession of the sidewalk because, under the terms of the lease, Panorama had only a right of non-exclusive use. The Supreme Court said that Panorama’s status as the largest tenant, its sign out front, and its operation of the reception desk for the entire building were not enough to establish that Panorama was “in possession of” the sidewalk in front of the building. The primary factor bearing on the Supreme Court’s decision was the “non-exclusive use” language in Panorama’s lease. The Supreme Court said that possession of real property does not necessarily require the right to exclude all others, but it does require the right to exclude, at least, some others.

    The Supreme Court went on to rule that the second definition of “landowner” also did not apply to Panorama in these circumstances. Under the terms of Panorama’s lease, the landlord was responsible for maintenance and upkeep of the sidewalk. Panorama’s non-exclusive right to use the sidewalk did not make it legally responsible for its conditions, its circumstances, or the activities conducted thereon. The Supreme Court said that the contractual provision in which Panorama agreed to indemnify the landlord regarding its tenancy had no bearing on the determination of whether Panorama is considered a “landowner” of the common areas under the PLA. Rather, the Court’s analysis of the PLA is wholly separate from its analysis of contract that may exist between parties.

    Lessons to be Learned from This Case

    Under the PLA, a commercial tenant will generally not be liable as a “landowner” for injuries occurring by reason of conditions of common areas in or around its leased space, or activities conducted thereon, simply because that tenant’s customers must pass through common areas to reach the tenant’s business. However, this is not a blanket protection applying in all circumstances. Rather, the Court reiterated that claims under the PLA must be evaluated on a case-by-case basis. Tenants should be wary of what maintenance/upkeep responsibilities they undertake under the terms of their leases. Had the tenant in this case undertaken the responsibility of general maintenance and upkeep, even had it been a shared responsibility with the landlord, the Supreme Court would likely have held it to be a “landowner” under the PLA and, therefore, liable for Jordan’s injuries.