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Expansion of Employer Liability in Georgia

(JANUARY, 2021)

Preface

In November 2020, the Georgia Supreme Court significantly expanded employers/principals' liability in claims alleging negligent hiring, training, supervision, retention, and entrustment. In Quynn v. Hulsey, the Court overturned the long-standing "Respondeat Superior Rule" to potentially allow a jury to consider apportioning fault against an employer for their independent acts of negligent hiring, training, supervision, retention, and entrustment of their employee. This rejection of precedent was done despite the employer admitting the employee acted within the course and scope of employment at the time of the alleged tort. This decision represents the latest in a growing body of case law illustrating the far-reaching and unintended impact of tort reform since its enactment of the Georgia Apportionment Statute in 2005. It is evidence of expanded and unforeseen claim and litigation risks. This article will explore the reasoning behind and impact of the new ruling in Quynn v. Hulsey.

The Prior Law on Respondeat Superior Liability of and Employer

As with most jurisdictions, under Georgia statutory law, an employer is liable for its employees' negligent acts or omissions while acting within the course and scope of employment. O.C.G.A. §51-2-1, et seq. In the 1960s, Georgia appellate courts held that an employer could not be held independently liable for claims of negligent hiring, training, supervision, retention, and entrustment if the employer admitted the employee was acting within the course and scope of employment at the time of the tort. The court held the admission of an employment relationship at the time of the tort established vicarious liability on the employer for its employees' acts or omissions. The employer's liability then became solely derivative of its employee's negligence; thus, they were considered one "party." A verdict exonerating the employee would result in a legal bar to the claims against the employer.

Further, a verdict and judgment against the employee would provide full compensation to the injured party, collected from the employee and the employer. Thus the derivative claims of negligent hiring, training, supervision, retention, and entrustment against the employer were not necessary once the employer had admitted a respondeat superior/vicarious liability relationship. These holdings became known as the "Respondeat Superior Rule."

Under the "Respondeat Superior Rule" when a plaintiff alleged the employer was vicariously liable for the negligent acts of the employee, and also responsible for its independent negligent hiring, training, supervision, retention and entrustment and other derivative claims, the employer was entitled to summary judgment on the "independent" claims if it admitted the employee was acting in the course and scope of his employment. Willis v. Hill, 116 Ga. App. 848, 159 S.E.2d 145 (1967); Hosp. Auth. Of Valdosta v. Fender, 342 Ga. App. 21, 802 S.E.2d 346 (2017). The only exception arose where the plaintiff asserted a claim for punitive damages based on the employer's actions. The courts held the purpose of punitive damages was to deter any "aggravated" activity by the employer in hiring, training, supervision, retention, and entrustment of an incompetent employee. Punitive damages are not to compensate the injured party. Thus, it was an independent claim and not derivative of the actions of the employee. However, in cases of a defense verdict for the employee on the underlying tort claim, the punitive damage claims against the employer for negligent hiring, retention, entrustment, or training would likewise fail as a matter of law.

The practical effect of the "Respondeat Superior Rule" was to restrict potentially prejudicial evidence against the employer and limit the plaintiff at trial to presenting evidence of solely the employee's negligence. For example, in the absence of a viable claim for negligent entrustment against the employer, an employer's alleged knowledge of a particular employee's risk factors or failure to properly vet an employee would lack relevance. In at least one case, the Georgia Court of Appeals explained the reason behind the Rule was that the plaintiff was only entitled to one recovery. Thus, allowing claims for negligent entrustment, hiring, and retention against the employer would merely prejudice the employer. MasTec North Am. V. Wilson, 325 Ga. App. 863, 865, 755 S.E.2d 257 (2014). Further, since Georgia's comparative negligence statute bars a plaintiff from recovery if their negligence is equal to or greater than the combined negligence of all Defendants, removing the issue of the employer's independent negligence and having the employee and employer treated as one "party" potentially lessened the chances of a Plaintiff being less at fault than the Defendants.

Ending Of The Precedent and The "New" Law

The Facts of the Underlying case

The court overturned the Respondeat Superior precedent on November 3, 2020 in Quynn v. Hulsey, __ S.E.2d __ (Ga. Sup. Ct. Nov. 3, 2020). In that case, the plaintiff brought an action against truck driver Hulsey and his trucking company employer, claiming Hulsey negligently operated a truck and caused her injury. Plaintiff also asserted ordinary negligence and punitive damage claims against the trucking company employer for negligent hiring, training, supervision, retention, and truck driver Hulsey's entrustment. While asserting that the plaintiff was comparatively negligent for causing the accident, Hulsey's employer conceded vicarious liability for Hulsey's negligent actions if proven, under the doctrine of respondeat superior. However, the trucking company employer moved for summary judgment on the plaintiff's claims for punitive damages and negligent entrustment, hiring, training, supervision, and retention. Relying on the precedent of the "Respondeat Superior Rule," the trial court granted summary judgment on the punitive damage claims and to the employer on the negligent entrustment, hiring, training, supervision, and retention claims. Plaintiff appealed that ruling, which was affirmed by the Court of Appeals. 

In the trial on the negligence claims over truck driver Hulsey and the plaintiff's actions, a special jury verdict form allowed the jury to apportion percentages to the plaintiff individually and truck driver Hulsey and his employer as one group. The jury returned a verdict finding Plaintiff 50% at fault, and truck driver Hulsey and his employer 50% at fault. Since Georgia's comparative negligence statute bars recovery for a plaintiff who is 50% at fault or greater when compared to the negligence of the Defendants, and since truck driver Hulsey and his employer were one "defendant" because the employer's liability was solely derivative of the employee's, the court entered judgment in favor of employee Hulsey and his employer. Plaintiff appealed that judgment, and the case ultimately went to the Georgia Supreme Court.

The Supreme Court's Ruling and Rationale

The Supreme Court reversed summary judgment on the claims of negligent hiring, training, supervision, retention, and entrustment against the employer. It held the Respondeat Superior Rule was no longer valid because it was inconsistent with the apportionment statute's plain language. Id. The Court held the exact wording of the apportionment statute, O.C.G.A. §51-12-33 requires the jury to consider the fault of all persons who contributed to the alleged injury or damages and apportion percentages of fault accordingly to each person. The Court reasoned that the evidence required to prove negligent hiring, training, supervision, retention, and entrustment claims against an employer differs from the evidence needed to prove negligence against the employee. They are separate torts, defined as a breach of a legal duty proximately causing injury to another, with distinct evidentiary proof requirements. The Court further reasoned that while an employer may be liable for payment of damages apportioned by the jury for the fault of its employee under respondeat superior and vicarious liability, the employee would not be responsible for payment of damages apportioned by the jury for the fault attributed to the employer for its independent acts of negligent hiring, training, supervision, retention, and entrustment of the employee. The Court held that the legislature could have clarified any desire for the Respondeat Superior Rule's continued application when they enacted the Apportionment Statute but did not. Thus, the Court must enforce the statute by its clear and unambiguous terms. The case was remanded to the trial court with instructions for a new trial, for the trial court, and the jury if appropriate, to hear evidence and consider as independent acts of negligence the actions of the employer in hiring, training, supervision, retention, and entrustment of truck driver Hulsey.

The dissenting opinion in Quynn viewed the majority's decision as inconsistent with most jurisdictions that have considered this issue and retained the Respondeat Superior Rule despite adopting similar apportionment schemes. The dissent noted that an employer could be exposed to double liability from fault apportioned by the jury to it for its actions and fault that flowed to it from the employee's negligence. Under the statute, any judgment from an apportioned verdict is several, and the party's sole responsibility upon whom the judgment is made after application of the apportionment percentage from the verdict. 

Effects of the Abolition of the Respondeat Superior Rule

Trial Issues

If there are sufficient facts to create a question of fact for a jury precluding summary judgment for the employer, the Supreme Court's ruling allows the plaintiff to introduce evidence of the employer's alleged negligence in hiring, training, entrusting, retaining, and supervising the employee. That evidence could result in otherwise inadmissible "character" and "prior acts" evidence relating to the driver's incompetence or habit of recklessness to enter the case on the negligent entrustment claims against the employer prejudice to the driver. The Court did indicate that trial courts must assess whether the evidence's prejudicial impact on the independent claims against the employer outweighs the relevance of that evidence to determine its admissibility in the case.

The evidence against the employer could also confuse the jury on their role in assessing the driver's liability for the underlying tort. A jury may struggle with the concept of apportioning fault among the plaintiff (if applicable), the employee, and the employer and its impact on the comparative negligence bar. The practical effect of adding a third line for the employer to the jury verdict form may help a plaintiff survive the 50% rule that bars recovery. Under the Respondeat Superior Rule the employer and employee were viewed as one party.

Claims Handling and Litigation Issues

This ruling creates the potential for conflicts of interest between the employee and the employer. Under the apportionment statute, any judgment from an apportioned verdict is several, and the party's sole responsibility upon whom the judgment is made after application of the apportionment percentage from the verdict. The employee's liability for the underlying tort could be reduced by the amount of fault assigned by the jury to the employer for its independent acts of negligent hiring, training, supervision, retention, and employee entrustment. Since a judgment against the employee is several, a conflict may exist in situations because the plaintiff could seek to collect the judgment on the employee's negligence from the employee only.

Given the potential conflicts, it will be crucial for the claims personnel to investigate and evaluate the evidence relating to both the underlying employee tort and the possible independent acts of negligent hiring, training, supervision, retention, and entrustment of the employer. Counsel retained by the employer or an insurance carrier must assess whether they can represent both the employee and the employer in the matter. The use of indemnity agreements favoring the employee may be useful in preventing any such conflict.

Conclusion

While the Quynn case arose in the context of a transportation case, its ruling and impact apply to all claims and lawsuits involving questions of negligent acts of a principal, agent, independent contractor employer, employee, and issues of vicarious liability. This "new law" should be considered by those involved in underwriting, claims assessment, planning of litigation strategy, litigation, and settlement evaluation in claims and cases involving negligence claims against employers, employees, independent contractors, principals, and agents. This ruling creates potential exposure and conflict issues that did not previously exist in Georgia. This ruling could also portend a trend in other jurisdictions allowing for apportionment of fault and damages.

- (Gary Lovell and Lacey Houghton, CSKL)

 

 

CSKL’S Sarah Butler Elected President of South Carolina Defense Trial Attorney Association

(NOVEMBER 13, 2020) - Sarah Butler was recently elected as President of the South Carolina Defense Trial Attorneys’ Association (SCDTAA). The South Carolina Defense Trial Attorneys’ Association, arguably the preeminent South Carolina legal defense association, is celebrating it’s 52nd year in operation. Sarah has been a dedicated SCDTAA member throughout her legal career.

The SCDTAA was formally organized in 1968 after a series of discussions with insurance and industry representatives about the need for an organized state defense bar. The SCDTAA brings together by association, communication and organization, lawyers of South Carolina who devote a substantial amount of their professional time to the handling of litigated cases and whose representation in such cases is primarily for the defense. SCDTAA’s mission is to promote justice, professionalism and integrity in the civil justice system by bringing together attorneys dedicated to the defense of civil actions. For more information on SCDTAA, click here - (CSKL.LAW)

 

CSKL Announces Attorneys Elevated To Partner In 2021

(JANUARY 4, 2021) - Copeland, Stair, Kingma & Lovell, LLP is pleased to announce three attorneys have been elevated to partner effective January 1, 2021.  We congratulate each of them for this achievement and couldn’t be prouder of the manner in which they have distinguished themselves, both in the courtroom and within the community.

Our newest partners each exhibit our Firm Fundamentals in all that they do. These lawyers continue to grow, shine and demonstrate leadership. We are proud to see their progress, and know that they will help the Firm achieve our ultimate goal of superior client service for years to come.


Clinton F. Fletcher, in the Atlanta office of CSKL, focuses his practice in general liability.  In particular, Clinton has extensive experience in the areas of products and premises liability, trucking, aerospace, construction equipment and material handling equipment.

With respect to Clinton’s aerospace experience, Clinton has defended large air carriers from personal injury and cargo loss claims, applying laws and principles arising out of the Montreal Convention, Air Carrier Access Act, Carmack Amendment and various Federal Aviation Regulations.

As Georgia counsel for two major auto manufacturers, Clinton has significant experience defending warranty claims arising under the Magnuson-Moss Warranty Act and Georgia’s Lemon Law.  On behalf of one auto manufacturer’s financing arm, Clinton defended consumer protection claims in both state and federal courts.

Clinton is rated AV Preeminent by Martindale-Hubbell and was named to Georgia Super Lawyers Rising Star list consecutively from 2009 to 2014.  He currently is the Georgia State Membership Chair for the Defense Research Institute (DRI) and recently cycled off as chair of DRI’s Recreational Products Specialized Litigation Group.  In addition to his practice with the firm, he is a published author and respected presenter.  A devoted volunteer, Clinton’s most recent service was on the Board of Directors for St. Jude’s Recovery Center, a non-profit, comprehensive addiction treatment center serving the Metro Atlanta area.


Matthew Gass is a new partner in the Firm’s Atlanta office. His practice is focused primarily in the area of commercial litigation. Matt has experience in legal and accounting malpractice and director officer litigation. Prior to joining the firm, Matt was Staff Attorney to the Honorable Chief Judge Ben W. Studdard of Henry County State Court. During his clerkship, Matt was a volunteer coach for a local high school in the State Bar of Georgia’s Mock Trial Competition and a co-chair of the Young Lawyers Division Judicial Law Clerk Committee.  Before moving to Atlanta, Matt worked as a summer associate in Madison Square Garden Company’s legal department.

In 2013, Matt received his Juris Doctorate from Wake Forest School of Law where he was the Senior Notes and Comments Editor for the Wake Forest Law Review, a teaching assistant, and Chief Justice of the school’s Phi Alpha Delta law fraternity chapter. While at Wake, Matt received awards for excellence in Constitutional Law, Trademarks, Intellectual Property Licensing, and Legal Analysis Writing and Research. He graduated summa cum laude from Syracuse University’s Maxwell school in 2008 with a degree in political science. Between college and law school, Matt was awarded the Roth Fellowship to work in the New York State Senate and served one year with AmeriCorps in Boston.


Lacey L. Houghton is based in the firm’s Charleston office and practices general civil litigation across Georgia and South Carolina.  Her current practice focuses on cases involving medical malpractice, correctional healthcare, and premises liability. Lacey handles a wide variety of professional liability matters, and  frequently defends lawyers, accountants, real estate and banking professionals, as well as corporate directors and officers  in errors and omissions liability cases. In addition to serving her clients through the conclusion of trial court proceedings, Lacey has significant appellate experience in state and federal court.

Prior to joining Copeland, Stair, Kingma & Lovell,  Lacey worked at a business litigation firm in Saint Simons Island, Georgia, where her practice included an emphasis on banking and lending litigation, as well as real estate, land use, and development litigation. Lacey held executive leadership roles in both the local and Georgia State Bar Young Lawyers Division, and served as legal advisor for the Board of Directors of United Way of Coastal Georgia.

Lacey earned her B.A. in International Affairs from the University of Georgia, summa cum laude, and her J.D. from the University of Georgia School of Law, cum laude. - (CSKL.LAW)

 

How is the Trial by Jury Being Impacted by COVID-19

(NOVEMBER, 2020) - Our forefathers brought to this country a fundamental right of a trial by jury of our peers through the Sixth Amendment to the Constitution. Jury trials continue to be a staple of the American Jurisprudence. The idea that one’s guilt is decided by a jury of their peers is romanticized by Hollywood, reorganized as an inalienable right of all Americans. The Covid-19 pandemic has presented us with an inherent conflict between public safety and a constitutional right, and it appears the jury trial as we know it, may face jihad. Backlogged dockets pile up, and courts are left with no choice but to conduct jury trials through unconventional methods or even virtually. On August 11, 2020, Judge Nicholas Chu of the Travis County Misdemeanor Court in Austin, Texas presided over a Class C misdemeanor traffic violation jury trial using the video conferencing tool, Zoom. The trial was the first case in U.S. history to be tried in such a manner and presented more problems than solutions. Thereafter, many states have resumed jury trials using a hybrid method such as Arizona, Florida, New Mexico, and New Jersey. See exhibit A. These modifications to the jury trial process, from jury selection to jury deliberation could give rise to constitutional challenges based upon a denial of the right to trial by a jury of our peers.

Exhibit A

(John Shaffery, Esq. – Poole Shaffery & Koegle)

Jury Selection

The ability to compose an impartial jury from a fair cross-section of the community is practically impossible. Vulnerable populations including low-income households and the elderly are likely to be excluded from the jury pool of virtual and traditional jury trials during the pandemic. The Pew Research Center found that nearly half of U.S. households with incomes below $30,000 a year do not have access to high-speed internet at home, and as many as 77% of senior citizens reported that they would require assistance when using a tablet or computer. While these populations are not representative of all that are excluded, a massive participation disparity is already created, and your jury panel is no longer representative of your jurisdiction.

In one of the first criminal trials conducted entirely via Zoom, a Texas court addressed the disparity in technology access by giving four prospective jurors court issued technology to report for jury duty. Two of those individuals were seated as jurors, but one was excused during the oath due to connectivity problems with the court-issued device. It began with a frozen screen, and despite the court’s attempts to remedy the situation, the judge eventually excused the juror that could not access the program. A total of five jurors, over 15% of the panel, were excused due to technical difficulties ranging from computer viruses to an outdated operating system that blocked one juror’s access to Zoom altogether.

How to implement voir dire to select a jury faces serious hurdles as well. Virtual voir dire poses serious problems with jurors being less than completely attentive to the process, with no way to know what could be impacting a juror’s attention. Furthermore, virtual voir dire denies attorneys the opportunity to get close enough to observe any biases jurors may express non-verbally. Conducting voir dire in-person also provides challenges as courts enforce safety procedures like screening prospective jurors for pre-existing health conditions, reconfiguring court rooms to allow social distancing, and the use of masks. While these safety procedures have shown promise in blocking the virus from penetrating institutions like the NBA bubble, they are potentially blocking an attorney’s ability to evaluate a juror’s responses which is essential to selecting a representative jury panel.

Allowing potential jurors to avoid service due to health conditions that would not ordinarily preclude service will likely impair the size of the panel because anyone who shows signs of discomfort could be excused from serving. Most jury panels are made up of jurors over 52 and many over 65 years old. How do we expect these older jurors to respond to notice of jury duty when they are experiencing a fear of exposure to the virus? Furthermore, many courtrooms are not designed to accommodate social distancing, so jury selection is being moved to auditoriums, civic centers, gymnasiums and even churches. This presents a challenge when some jurors may have difficulty hearing an attorney’s questions and other jurors’ responses. In Hennepin County, Minnesota (Minneapolis), the state determined that only (5) courtrooms had appropriate spacing for the trials, including all lawyers, witnesses, and court personnel. With respect to the cases tried in Hennepin County, the state is flipping the courtroom so that the gallery is being used for jury selection which allows the jurors to be spaced out at appropriate distances. The Federal court jury trial system is less impacted than state courts. Federal jury trials typically require six jurors with possible alternates while many states require 12 jurors and sometimes as many as three alternates. Therefore, the number of jurors summoned for a federal trial is significantly smaller than the veniremen summoned in state courts. An additional advantage is that many of the federal courts are newer and much more spacious while many of our state courts are old with small courtrooms and limited jury boxes and seating. In fact, it has been reported that in Massachusetts’s state courts, judges are telling counsel, “you are getting a jury of six and not 12 and is not even asking counsel to stipulate to the smaller jury.”

With respect to the use of masks, concealing facial expressions is problematic. Often during voir dire, a facial expression of a prospective juror in response to a question asked of another juror will cause an attorney to ask that juror to respond to the previously asked question as well. This issue even came up at the confirmation hearing of recent Supreme Court Justice Amy Coney Barrett. Many were concerned about not being able to see her facial expressions during her confirmation hearing.

The Trial

Michigan trial courts conducted more than 1.3 million hours of court proceedings via Zoom by the end of September 2020. The quick transition to digital dependence caused by the pandemic has its pitfalls but it has also provided us with moments of humor. During the onset of Supreme Court oral arguments in May, as Chief Justice Roberts reprimanded the court for ringing cellphones and then he was interrupted by the sound of a toilet flushing. Although the official transcript does not make note of the flush, I think we can all agree, res ipsa loquitur, “the thing speaks for itself.” However, toilet flushing is the least of our sticky situations as we attempt to digitize the legal system.

COVID-19 driven modifications present an overwhelming amount of challenges to the actual trial. Anyone who has experienced video conversations through FaceTime knows that there is no replacement for human interaction. Non-verbal communication is lost almost entirely on videoconferencing platforms like Zoom. The Social Psychology of Telecommunications provides that useful information like subtle eye movements and other non-verbal communication cues are not likely to be picked up on video. And where a typical Zoom call frames the individual from the chest up, jurors cannot see any body language communicated by the lower half of the body.  This severely distorts a juror’s ability to properly observe witnesses, their testimony, and evidence. As the sole judges of witness credibility, it is imperative that jurors be able to view witnesses and other jurors body language and non-verbal cues in their assessment.

Factors such as video quality, lighting, and angles could trigger biases in jurors as well. Witnesses speaking on behalf of wealthy defendants could appear more attractive and sincere as they sit in front of extravagant backgrounds and have superior video quality. We cannot even guarantee that witness testimony is candid in a virtual setting. What occurs off camera cannot be seen which could impact a witness’s testimony.

Additionally, jurors cannot possibly remain impartial when their ability, or lack thereof, to properly evaluate evidence is compromised by the limitations of videoconferencing. Erie County, New York (Buffalo), has resumed in-person trials & voir dire. They have two designated courtrooms – one for evidence presentation and one for a juror breakroom. In these courthouses, no other court business shall be conducted during trial. Attorneys may not approach witnesses – all evidence is handed to the court officer, then court officer displays evidence to the jury. Evidence does not always come in the form of a document, or in a form that can be shared via a file share program. Thus, where digital distribution or in-person display does not equate to physical interaction, the impact of evidence on jurors is certainly diminished.

Jury impartiality continues to be at issue even as some courts move on to conducting in-person trials. In Hennepin County, Minnesota (Minneapolis), once the jury is selected, the jurors are then spread across the gallery. Only one attorney is allowed at each table along with client. Before a witness testifies, they take down their mask to show the jury their face but then wear the mask the remaining time. From that point forward the trial is conducted in traditional fashion. The use of face masks and social distancing protocol present similar challenges. Jurors are still unable to observe witness facial expressions and subtle nuances in their demeanor to make a proper assessment of credibility.

Jury Deliberations 

Jury secrecy is essential to the work of juries to protect the integrity of deliberations and reassure open discussions. Thus, any modification to this sacred process poses a serious question of whether the trial by jury has been impaired to a level it has violated this constitutional right. As courts are forced to modify several functions of the jury trial in light of a global health emergency, this includes jury deliberations. When conducted virtually, how do we ensure all jurors are able to participate in the deliberations without monitoring their deliberations? If one of the other jurors cannot hear or see their fellow jurors, is it another juror who fixes the computer glitch or do they call someone else? Who exactly do they call? These questions must be approached very carefully to guarantee that jury deliberations do indeed remain secret.

A recent study conducted by Dubin Research Consulting presents that 74% of potential jurors experience feelings of anxiety about being in close physical proximity with others. Courts that have resumed in-person trials attempt to relieve this concern by conducting jury deliberations in the larger courtroom instead of the smaller rooms actually designated for deliberations. In King County (Seattle), the court has been holding trials in a conference center rented in a nearby town. Deliberations take place in large conference rooms separate from the rooms in which the trials are held. Nevertheless, jurors are still likely to feel some level of anxiety, interrupting their decision-making ability, during a very crucial moment of the jury trial process.

We are undeniably fortunate that advancements in technology have enabled our justice system to persist amidst a global pandemic. But we cannot ignore the consequences and limitations. In the face of the pandemic, courts in Johnson County, Kansas organized the Ad Hoc Jury Trial Task Force and court issued a 30-page order with the task forces suggestions for conducting jury trials under pandemic conditions. Many states have followed suit and although these challenges are daunting, special bench bar committees and experts continue to evaluate and develop alternatives methods in an effort to safeguard a sacred right unique to our country -- a right to trial by jury. However, even in taking all the necessary precautions, some courts have found it impossible to preserve the rights of litigants while also ensuring safety. In the U.S. District Court of Nebraska’s November 2nd order regarding the postponement of jury trials, the court stated:

The resurgence of the COVID-19 pandemic in the District of Nebraska, and the increased community transmission of that disease, have again reached the point at which the Court's proceedings are affected. . .. In that environment, despite the physical distancing  measures in place, the Court is presently unable to draw a venire, select a jury, and try a case to  completion in a manner consistent with the right to a fair cross-section of the community or due process for the litigants. And it is the Court's responsibility, as a careful steward of public safety, not to unnecessarily or unduly endanger its own personnel, other participants in the judicial process, or members of the community.

(See General Order 2020-14). Since the founding of the United States, our courts have considered the intersection of the legal system and public health. The founders had ample experience with smallpox, yellow fever, cholera, typhoid, and malaria. Covid-19 is just another obstacle in the long line of illnesses which have threatened American Jurisprudence. At this moment in time, it is unclear what the next step will be in preserving the sanctity of the American Jury trial. But one thing is guaranteed, the American Jurisprudence system will persevere and prevail, so that the next time we are faced with such an enemy, we will be ready. 

Author Bios

Daniel F. Church

For more than 30 years, Daniel F. Church has been representing local, regional, and national companies in civil litigation, both in federal and state courts. He represents defendants in class action suits, as well as in cases involving toxic torts, bad faith, railroad, premises liability, professional liability, product liability and general tort claims. He has tried more than 40 cases before juries, many involving damage claims in excess of one million dollars and has represented clients in civil trials in 15 states. Mr. Church was selected as one of the "Best Lawyers in America" by his peers and as a Super Lawyer in the Kansas City area.  Mr. Church is currently on the Board of Directors for the Professional Liability Defense Federation.

Shawn A. Meyer

Shawn A. Meyer went to Chicago Kent College of Law and earned his Juris Doctorate Degree with a certificate in Business Law. Shawn currently resides in Kansas City, Missouri where he works as a Civil Litigation attorney at Morrow Willnauer Church, LLC. - (Morrow Willnauer Church, L.L.C.)

 

Unauthorized Occupants: What Status Do They Hold in Premises Liability Claims?

(NOVEMBER 30, 2020) - When a lawsuit arises from an injury that occurs as a result of a dangerous condition on another’s property, this type of claim is called “premises liability.”1 Normally, those in possession or control of real property (aka a “possessor”) owe a duty of care to individuals who access such property. In all but a handful of states, this duty is ultimately dependent on the plaintiff's status on the land. In these jurisdictions, generally the only duty possessors owe to undiscovered trespassers is to refrain from “willful and wanton conduct”2 or “intentional misconduct.”3 Absent specific evidence, this is a very difficult standard for plaintiffs to overcome. 

Oftentimes, however, it is not always clear under what circumstances an injured party may be considered a trespasser; particularly when the injury occurs at an apartment complex. Notably, it is unclear what status a plaintiff holds when he/she is injured while living at – or otherwise occupying – an apartment without authorization from the landlord. Individuals who fall into this category are frequently referred to as “unauthorized occupants.”

The U.S. Department of Housing and Urban Development defines an “Unauthorized Occupant” as “a person who, with the consent of a tenant, is staying in the unit, but is not listed on the lease documents or approved by the owner to dwell in the unit.”4 An example of an unauthorized occupant would be a tenant’s significant-other who moves into the apartment without the consent of the landlord. Another example would be a person paying or otherwise compensating a tenant to “rent out” all or part of an apartment without the landlord’s knowledge or permission.

Conversely, the U.S. Department of Housing and Urban Development defines a “guest” as “a person temporarily staying in a unit with the consent of the tenant or another member of the household who has express or implied authority to consent on behalf of the tenant.”5 Although landlords do not expressly invite guests onto their property, it is generally accepted that guests receive an “implicit” invitation as it should reasonably be expected that tenants may invite people to visit or temporarily stay at their apartment.6 As a result, in nearly all jurisdictions, social guests are afforded the same duty as tenants and other invitees.

However, logic dictates under most circumstances that an unauthorized occupant cannot reasonably be said to have received an implied invitation from the landlord. This is particularly true in cases where the unauthorized occupant fails to benefit the landlord or where his or her occupancy violates a law. Nonetheless, because an unauthorized occupant receives an express invitation from the tenant, these individuals do not always meet the threshold for most state’s common law and statutory definitions of a trespasser.   

Consider the state of Florida for example. There, the standard jury instruction defines an “invitee or invited licensee” as “[a] person [who] is invited on land or premises of another when he enters or remains there at the invitation of the owner or possessor.”7 Here, because the invitation must come from the possessor, an unauthorized occupant should not be held to this status. However, Florida Statute also defines an “undiscovered trespasser” in pertinent part as “a person who enters property without invitation, either express or implied…”8 Further, the statute defines the term “invitation” as meaning “that the visitor entering the premises has an objectively reasonable belief that he or she has been invited or is otherwise welcome on that portion of the real property where injury occurs.” Notably, as the statute is silent as to whom the invitation must come from, the unauthorized occupant’s status arguably fails to meet the legal standard for a trespasser. While it is tempting to merely dismiss this ambiguity as “an issue of fact” (and issues of fact may indeed exist), it is clear that the ultimate determination as to whom the invitation must come from does not “depend on the probative value of any evidence,” and thus is a pure question of law that should be determined by the court.9

However, while this question of law has arguably never been directly answered by the courts, there are nonetheless strong arguments that can be made to both the judge and jury for why an unauthorized occupant must be held to the status of a trespasser. The first and most important argument is that the plaintiff’s presence was a direct violation of the express terms of the lawful occupant’s lease agreement. Most residential lease agreements have terms that forbid unidentified individuals from occupying the apartment absent written consent from the landlord. Additionally, many lease agreements have restrictions or required disclosures regarding the tenant’s criminal record. To the extent the plaintiff has a criminal record – even a misdemeanor – the defense may argue that such conviction(s) disqualify him or her as a lawful occupant.

Next, it should be determined if the plaintiff’s presence violated any local, state or federal laws. Most notably, when tenants are receiving federally subsidized rental assistance – which is oftentimes calculated by household income - there are additional laws and regulations that are triggered.  Most notably, an unauthorized occupant’s presence appears to be a clear violation of Section 42 of the Internal Revenue Code, as well as the occupancy guidelines for The Low-Income Housing Tax Credit (“LIHTC”)  and United States Department of Housing and Urban Development (“HUD”) programs. Additionally, to the extent the unauthorized occupant is employed or receiving independent subsidies, this unreported household income could easily disqualify the tenant from his or her rental assistance, potentially making the tenant and unauthorized occupant guilty of fraud.

Finally, it should be determined if the unauthorized occupant’s presence on the property would be detrimental to the landlord by exposing it to financial or administrative liability. For example, if the property is an affordable housing project, the defense may argue that the unauthorized occupant’s presence made the landlord noncompliant with federal law, potentially resulting in fines, loss of tax credits or an inability to participate in future affordable projects.

In cases where there is no issue of fact that the plaintiff was an unauthorized occupant, defense counsel can and should move for summary judgement. In doing so, rather than focusing on the unauthorized occupant being a per se trespasser, it is probably easier to establish that he/she cannot reasonably be held to the status of an invitee or licensee. Specifically, it will be necessary to provide authority that makes it clear that any implied invitation must come from the possessor and not the tenant. Depending on the circumstances of the case, as well as the available case law in your state, defense counsel may consider citing section 52 of The Restatement (Third) of Torts: Liability for Physical and Emotional Harm. Notably, the Restatement sets forth a unique standard referred to as “flagrant” trespassers. While the Restatement does not attempt to fully define a flagrant trespasser, it explains that the "core distinction between trespassers is the extent to which the trespass is offensive to the rights of the land possessor."10 Depending on how inflammatory the unauthorized occupancy is, the Restatement may be enough to convince the court that he/she is a trespasser as a matter of law.

Whether the issue is ultimately determined dispositively by a judge, or at trial by a jury, if a possessor can establish that the plaintiff was an unauthorized occupant of the premises, it has a good chance of substantially reducing the duty of care owed to such individual. - (Brooks A. Saible, Baumann, Gant & Keeley, P.A.)


 1 Bovis v. 7-Eleven, Inc., 505 So .2d 661, 662 (Fla. 5th DCA 1987); see also, Hix v. Billen, 284 So.2d 209, 210 (Fla.1973) ("There is a distinction to be noted between active, personal negligence on the part of a landowner and that negligence which is based upon a negligent condition of the premises.").

3 See § 768.075(3)(a)(3), Florida Statutes

4 U.S. Department of Housing and Urban Development Handbook 4350.3: Occupancy Requirement of Subsidized Multifamily Housing Programs.

5 Id.

6 Wood v. Camp, 284 So.2d 691 (Fla. 1973). 

7 Fla. Std. Jury Instr. (Civ.) 401.16(a).

8 § 768.075(3)(a)(3), Florida Statutes

 

 
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