January 20, 2023 BF_Admin

Landlords Out Of Possession: When Are They Liable For Unsafe Conditions On Their Property?

By: Samantha DiBona

A decision made in one of our cases involving Plaintiff Cameron Dean, in the matter of Brown v. End Zone Inc., changed the legal understanding of liability for landlords out of possession. A landlord “out of possession” is a landlord who has leased property and has not “maintained control over the premises” in question. Cf. Juarbe v. Philadelphia, 431 A.2d 1073, 1081 (Pa. Super. 1980).  For example, a landlord out of possession could be a private individual who rents a single family home to a tenant. The landlord has no right of possession, meaning the landlord does not control the use of the land nor the activities that take place on the property. Another example could be a private corporation who rents land to a baseball league who controls the property. Again, the landlord retains no right of possession, and therefore isn’t liable for injuries or harm to guests or invitees that might result from the renter’s use of the property.

Generally, a landlord out of possession is not liable for injuries of third parties that take place on the leased premises, because the landlord does not owe any duty to such visitors. This general rule is based on the legal understanding that a lease transaction is equivalent to a sale of the land for the term of the lease. This means that “liability is premised primarily on possession and control, and not merely [on] ownership.”

In Pennsylvania, there are six exceptions to this general rule, paraphrased below:

    (1) if the landlord has reserved control over a defective portion of the demised premises,
    (2) if the demised premises are so dangerously constructed that the premises are a nuisance intrinsically,
    (3) if the landlord has knowledge of a dangerous condition existing on the demised premises at the time of transferring possession and fails to disclose the condition to the renter,
    (4) if the landlord leases the property for a purpose involving the admission of the public and he or she neglects to inspect for or repair dangerous conditions existing on the property before possession is transferred to the renter,
    (5) if the landlord undertakes to repair the demised premises and negligently makes the repairs, or
    (6) if the landlord fails to make repairs after having been given notice of and a reasonable opportunity to remedy a dangerous condition on the leased premises.
    30 P.L.E. LANDLORD AND TENANT § 257 (2021), citing Toth v. Philadelphia, 247 A.2d 629 (Pa. Super. 1968)

All of these exceptions seem aimed at physical conditions of the property, the sort of negligence that might be involved in a slip-and-fall case due to a dangerous condition on the land. However, there is an additional, little-known exception for when the landlord has actual knowledge of a danger to the public on the land. Palermo v. Nails held that on public policy grounds it is “socially unacceptable for a landlord to fail to act when he knows that it is likely that [a] dangerous animal will attack an innocent person on his tenant’s property.”  483 A.2d 871, 873 (Pa. Super. 1984).

A landlord who leases land for a purpose which involves inviting members of the public (i.e. a store, a bar, a gas station etc.) can be held responsible for physical harm caused to people who enter the premises as a result of it being open to the public, if the landlord…

    (a) knows or by the exercise of reasonable care could discover that the condition involves an unreasonable risk of harm to such persons, and
    (b) has reason to expect that the renter will admit them before the land is put in safe condition for their reception, and
    (c) fails to exercise reasonable care to discover or to remedy the condition, or otherwise to protect such persons against it.
    Restatement (Second) of Torts § 359 (1965) (slightly paraphrased, emphasis added).

In our case, we sued a strip club for negligent security which put our client at an unreasonable risk of harm, resulting in a chaotic, uncontrolled, dangerous brawl among overserved patrons at 4AM (two hours after liquor establishments are required to stop selling alcohol, according to Pennsylvania law). Our client, an employee of the club, was assaulted several times during the brawl, including a stanchion being slammed onto his head, necessitating a painful recovery process from a traumatic brain injury.

Tez Management LLC was the landlord of the property, leasing it to End Zone LLC. End Zone LLC operated the location as a strip club called Club Onyx. The Plaintiff argued that Tez Management LLC should be held liable for the activities of its renter, End Zone LLC, because the landlord knew of the dangerous activities which put the public at risk of harm on the leased premises. After all, pursuant to Restatement (Second) of Torts § 379A (1965), a landlord is subject to liability for physical harm to public visitors caused by activities of the renter or others on the land after the landlord transfers possession if, but only if,

    (a) the landlord at the time of the lease consented to such activity or knew that it would be carried on, and
    (b) the landlord knew or had reason to know that it would unavoidably involve such an unreasonable risk, or that special precautions necessary to safety would not be taken.
    Restatement (Second) of Torts § 379A (1965).

The Plaintiff argued that Tez Management LLC had actual knowledge that The End Zone LLC “was knowingly and intentionally operating in violations of the Conditional Licensing Agreement and the Consent Order,” by failing to provide adequate security, illegally serving alcohol after hours, and in operating without the required certifications.

The Plaintiff’s expert witness in professional security concluded that, based on the evidence presented, Tez Management LLC knew or should have known the problems The End Zone LLC presented and their history of incidents, but nevertheless allowed those problems to continue on its property with no threat of eviction or consequences for the renter.

Brown is the first Pennsylvania case applying § 379A, and one of only a handful nationally. Brown – read in conjunction with Palermo – could be said to affirm that a landlord has a duty to act at any time when the landlord attains actual knowledge that his or her leased property is being used by the renters for a purpose or in a manner that poses a clear danger to the public, including negligent security.


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