An out-of-possession landlord is a landlord who has “fully parted with possession and the right of possession.”[1] Generally, out-of-possession landlords are only liable for injuries to others where they’ve failed to repair the premises or there’s defective construction. A recent Georgia case has further limited an out-of-possession landlord’s liability to injured persons for defective construction.
In Cowart v. Schevitz,[2] a tenant restaurant’s patron fell in the parking lot outside the restaurant. The patron sued the tenant and landlord, asserting, correctly, that local building code required a ramp leading down to the parking lot to have handrails (which it did not). The patron asserted that her injuries would not have occurred if the handrails had been in place.
The landlord in Cowart knew the ramp didn’t have handrails. Even so, the Court of Appeals held the landlord was not liable for two reasons: (1) the ramp was not constructed by the landlord’s predecessor-in-title, and (2) the landlord didn’t have superior knowledge of the defective ramp.
The evidence showed that the ramp was constructed by a predecessor tenant and not the current tenant. On this basis alone, the out-of-possession landlord could not be liable. Georgia law only imposes liability on an out-of-possession landlord where the building was defectively constructed by a predecessor in title. Moreover, the landlord could not be liable because the landlord’s consent was not obtained prior to construction of the ramp.
The second basis for the Cowart decision is that the landlord lacked superior knowledge of the defective ramp. In other words, the condition of the ramp was equally known to both patron and landlord. By contrast, the Court noted another case in which a landlord was held liable for a death occurring due to a concealed precipice with no barricade or warning.
A prudent purchaser or landlord acquiring property should always conduct thorough due diligence to discover potential hazards. But even if that inspection fails to uncover a defective condition, Cowart provides landlords reassurance that they cannot be held liable if that defect was caused by someone outside the chain of title. Moreover, landlords cannot be liable if the purported defect is equally known to all (as opposed to some hidden or concealed danger that the landlord could have known about).
[1] O.C.G.A. § 44-7-14.
[2] 335 Ga. App. 715 (2016).