Residential Condominium Association is Not Liable for Sidewalk Injuries

Luchejko v. City of Hoboken, 207 N.J. 191 (2011).  Sidewalk liability cases have bedeviled our Supreme Court for many years.  In Stewart v. 104 Wallace Street, Inc., 87 N.J. 146 (1981), the Court jettisoned the longstanding rule that property owners could not be liable for sidewalk injuries and established that commercial property owners could be sued for such injuries.  Residential owners, however, remained protected from such claims, though Stewart did say that apartment buildings would be considered as commercial properties.

This case involved a residential condominium association that owned and maintained sidewalks at the 104-unit condominium development.  The sidewalks were part of the common elements for which the association was responsible.  Plaintiff slipped on snow and ice on the sidewalk and sustained injuries.  He sued the City of Hoboken, the association, and others.  The trial court granted summary judgment to the City and the association.  Plaintiff appealed, and the Appellate Division affirmed.

By a 4-2 vote, the Supreme Court agreed that the association could not be liable.  Justice LaVecchia wrote the majority opinion.  Justice Long dissented, in an opinion that Justice Albin joined.

The two opinions each analyzed essentially the same prior cases.  The main difference in those opinions was in their respective interpretations of those cases.

Justice LaVecchia and the majority viewed those authorities as essentially having established “the basic principle that residential property owners are not liable for sidewalk injuries.”  Those decisions “consistently reflect that residential property owners stand on different footing than commercial owners who have the ability to spread the cost of the risk through the current activities of the owner.”  Though the association could and did buy insurance to protect against sidewalk liability, “the spreading of the cost of insurance among residential owners is not the sharing of risk originally presented in the commercial context of Stewart, where the cost of the insurance could be shifted to patrons and other business endeavors of the entity as a cost of doing business.”

The majority relied heavily on stare decisis.  Justice LaVecchia’s opinion contains a detailed and useful discussion of that doctrine, which (among other things) fosters reliance on longstanding judicial decisions.  Allowing liability here would replace a bright line rule with “an unpredictable case-by-case balancing test that would be extremely difficult to fairly and consistently administer and that would lead to tremendous uncertainty.”

The dissent rejected the idea that Stewart set up “a mere sorting exercise in which our role is to declare into which pre-determined category– commercial or residential– the landowner falls, without a conscientious analysis of whether it is fair to impose a duty under the circumstances presented.”  Justices Long and Albin viewed Stewart and subsequent cases as “eschewing a bright-line analysis in favor of equitably balancing the duty factors.”  On the facts here, it was fair to permit the association to be liable because “it should have foreseen the fall; it was in the best position to take prophylactic measures to prevent it; and it was better able to bear the risk of loss than the innocent pedestrian ….”

Moreover, Hoboken had an ordinance that required property owners to maintain sidewalks, so that the association had a duty to do that.  The association also had insurance, for which its members had paid.  The dissenters found this cost-spreading an important factor.

The majority rightly recognized the importance of protecting individual homeowners from sidewalk liability.  But the association here was little different than an apartment building owner.  The majority worried that the association’s insurance “does not eliminate the potential that a large enough liability verdict could pose the risk of a person losing what is his or her largest asset: one’s home.”  That seems far-fetched.  In the condominium context, a separate entity, the association, controls sidewalks and is required to have adequate insurance.

The Court had invited the parties to offer “a reworked bright-line rule that might principally sweep in condominium complexes such as [this one] while still insulating ordinary homeowners from liability,” but “[n]o such rule was forthcoming.”  This issue, likely to recur (as sidewalk cases did for so many years pre-Stewart) might be a good one for a carefully developed legislative solution.