Commercial Tenant Relieved of Duty to Maintain Common Areas in N.J. Appellate Division Decision

Commercial tenants in multi-tenant shopping centers can now breathe a sigh of relief as the New Jersey Appellate Division in Kandrac v. Marrazzo’s Market of Robbinsville, safeguards the boundaries of commercial tenant liability for business invitees, reiterating that a commercial tenant does not owe a duty to its patrons to maintain a common area, such as a parking lot, that the landlord is contractually obligated to maintain.

The decision adds to the previously designated responsibilities of commercial entities, see, e.g., Luchejko v. City of Hoboken (commercial entities have considerable rights to maintain adjacent sidewalks); Stewart v. 104 Wallace St., Inc. (commercial landowners have a duty to maintain sidewalks abutting property in reasonable good condition); Antenucci v. Mr. Nick’s Mens Sportswear (extending duty of commercial tenants to maintain sidewalk abutting store in exclusive possession of tenant); Warrington v. Bird (proprietor has duty to exercise reasonable care to not subject patrons to unreasonable risk of harm in traversing expected route), while confirming a special carve-out for commercial tenants in a multi-tenant shopping center who have contracted out of certain maintenance duties in common areas.

The injured plaintiff in Kandrac v. Marrazzo’s Market at Robbinsville, was walking through a parking lot of a multi-tenant shopping center after leaving Marrazzo’s Market when her “foot caught a hump” in the pavement, causing her to trip, fall forward on her face, and sustain injuries. She thereafter filed a complaint against Marrazzo’s Market (the “tenant or Marrazzo’s”) and Foxmoor Associates, LLC (the “landlord”) alleging negligence. The tenant filed a motion for summary judgment based on a provision of its lease agreement, which stated, in relevant part, that “the LESSOR [(Foxmoor)] covenants and agrees that it shall maintain the common areas of the shopping center in good operating condition.” Finding the landlord responsible for maintenance of the common area where plaintiff was injured, the Trial Court granted the tenant’s motion.

On appeal, plaintiff-landlord, argued that the motion judge erred, in part, because Marrazzo’s had a duty to provide safe ingress and egress from its store to the parking lot for its patrons. The Appellate Division disagreed. For the Court, whether a duty existed was a fact-sensitive issue, and, here, the tenant was simply not in an “ideal position” to inspect and “reasonably remedy” defects in the common parking lot because it was no longer the “expected route” for patrons from Marrazzo’s. The Court also held that “as a general rule, when a commercial tenant in a multi-tenant shopping center has no control or contractual obligation to maintain a parking lot shared with other tenants, the common law does not impose a duty upon the tenant to do so.”

As a result of the Appellate Division’s decision, a commercial tenant in a multi-tenant shopping center should be particularly aware of its responsibilities when entering into a lease agreement:

• First, based on Kandrac, the lease agreement for a commercial tenant in a multi-tenant shopping center should contain a term which requires the landlord to maintain the “common” areas of the shopping center, which may include, but are not limited to, “employees’ parking areas, service roads, loading facilities, sidewalks, and customers’ parking areas.” This ensures no confusion or potential danger, see Holmes v. Kimco Realty Corp., if such a duty is imposed on the multitude of tenants in a multi-tenant shopping center.
• Second, a commercial tenant in a multi-tenant shopping center must be aware that the existence of such a provision does not fully insulate it from potential liability. New Jersey precedent clearly indicates, and Kandrac confirms, commercial tenants still have a responsibility to maintain the sidewalks abutting their business, see Stewart, the crosswalk that identifies a route to/from the shopping center, see Monaco, or the expected route between a business and a parking lot, see Warrington. Thus, while a win for commercial tenants, it does not undo well-established premises liability precedent.