We just got another round of snow/rain/ice/freezing rain (hereinafter referred to as a “wintry mix”) this weekend. As I was out shoveling, my thoughts turned to the potential liability of property owners when someone slips on the wintry mix piled up on their property. OK, my thoughts did not really turn to this, but one of the questions that I do get asked somewhat frequently from friends and family is whether they can be liable if someone slips on their property under these circumstances. A recent decision from the Appellate Division, Zheng v. Santos, revisited the law on this subject. Although it is generally considered to be well-settled, the decision in Zheng reveals that there are a number of exceptions and nuances that make the law about as unsettled as our weather has been this winter.
In Zheng, plaintiff slipped and fell on the sidewalk outside of defendants’ three-family home in Jersey City. The issue before the court was whether the owners had a duty to remove snow and ice from the sidewalk. The trial court held that it did not, and the Appellate Division affirmed. In doing so, however, it provided a primer on the evolution of the law governing property owner liability for such injuries in New Jersey.
The court began with the “well-settled” notion that residential property owners are generally immune from liability for “accidents resulting from naturally-caused conditions of public sidewalks abutting [their] property.” The court noted that, “[h]istorically, no property owner . . . had a duty . . . to maintain the sidewalks on their [property] that abutted public streets,” but that this changed a bit in the early 1980’s, when the New Jersey Supreme Court imposed such a duty on commercial property owners, but not residential property owners. As part of this duty, commercial property owners were required to remove snow and/or ice from their sidewalks.
The problem with this seemingly simple residential/commercial distinction arises when property is both owner-occupied and income generating. New Jersey courts have always considered residential rental properties as commercial properties if they are not owner occupied. However, there is a “gray area” in this “commercial/residential distinction” when the underlying property is “an owner-occupied property with a small number of dwelling units . . [that] . . . is also used to generate income for the owner.” In such instances, a court must undertake a fact-sensitive inquiry into the “predominant use” of the property, that considers several factors, including:
(1) the nature of the ownership of the property, including whether it is owned for business or investment purposes;
(2) the predominant use of the property, including the amount of space occupied by the owner to determine whether it is used in whole or in substantial part as a place of residence;
(3) whether the property has the capacity to generate income, including whether the owner is realizing a profit; and
(4) “any other relevant factor when applying commonly accepted definitions of ‘commercial’ and ‘residential’ property”
In Zheng, the trial court concluded that defendants’ property was primarily residential. The Appellate Division affirmed. It relied on a number of facts to support this conclusion, including that: defendants had lived in the first-floor apartment of the property for more than 35 years, and it had been their only residence during this period; defendants rented the other two units to tenants, in the “distant past” to relatives who paid “what they could” as rent, and later to non-relative tenants; and that in the several years prior to plaintiff’s fall, defendants had broken even or lost money on the property when the amount collected in rent was compared to the carrying costs.
Plaintiff countered that it was “the capacity of the property to generate income that is the most relevant consideration,” and that, in the 21 years leading up to her fall, defendants had generated gross rents of between $478,000 and $642,000. Plaintiff contended that a property that could generate such “substantial rental income” must be designated as a commercial property. The Appellate Division rejected this argument, however, holding that the gross rents realized by the owners were not dispositive on the residential vs. commercial issue, and that instead the relevant inquiry was whether the “primary use” of the property was as the owner’s residence. In Zheng, the Appellate Division held that, after applying the facts of the case to the various factors discussed above, the underlying property was used as Defendants’ “long-time residence,” therefore it was residential and Defendants had no duty to clear their sidewalks of snow or ice.
Finally, the Appellate Division invited the Supreme Court and/or the Legislature to shed more light on the “gray area” at issue in Zheng and other cases. The Appellate Division observed, in a footnote, that “[t]he law would be more predictable if either . . . specified which owner-occupied residential properties are immune from sidewalk tort liability.” The Appellate Division noted that the Legislature has done something similar in the Anti-Eviction Act by spelling out which rental properties are subject to the Act and which are not. If it is appealed to the New Jersey Supreme Court, the Zheng case may just be the vehicle that would allow the Supreme Court to provide the guidance that the Appellate Division requested.