"Out-of-Possession Landlord" Not Liable for Floor Cave-In

Facts: An employee was injured while working at a warehouse leased by his employer. The floor of the warehouse collapsed while the employee was stacking steel in a bay. The basement under the bay was rented to another tenant. The employee and the steel fell into the basement. The employee suffered significant injuries; a co-worker died as a result of the accident. The employee sued the owner. The owner asked the trial court for a decision in its favor without a trial. The trial court ruled in favor of the owner. The employee appealed.

Decision: An Ohio appeals court upheld the judgment in favor of the owner.

Reasoning: On appeal, the employee argued that the owner was an “occupier” of the premises and as a result had control over the bay and basement where the accident happened, making it responsible because it “possessed” the basement and bay. The employee also argued the owner failed to disclose a hidden or latent defect—that is, the existence of the basement under the bay.

The owner argued that it no longer had possession or control of the bay, because it was leased to the tenant, or possession or control of the basement, because it was leased to a different tenant.

The owner claimed that, because it wasn’t in possession or control of the bay or basement, it owed no “duty of care” to the tenant’s employees, including the injured employee. It argued that in regard to commercial leases, the rule in Ohio is the doctrine of “caveat emptor,” meaning “let the buyer beware”—that is, buyers should examine for themselves things that they intend to purchase, because they can’t later hold the vendor responsible for the broken condition of the thing bought. Here, the doctrine would’ve put the responsibility to make sure the bay was safe on the tenant. The appeals court agreed that an owner has no liability for any injuries to third parties occurring on leased property that is out of the owner’s possession and control.

The owner also said that it was under no duty to disclose the existence of the basement, because not only is the mere existence of a basement not a defect, but even if it is a defect, in regards to commercial leases there is no requirement to disclose a defect. In any event, there was no evidence the basement was defective, the appeals court pointed out. Because the leased premises were the subject of a commercial lease and were available for inspection, the owner had no duty to disclose it, observed the court. Furthermore, the employee testified he and the tenant were aware that some portions of the property contained basements. In fact, the tenant leased one of the basement areas to use as a tornado shelter.

• Boatwright v. Penn-Ohio Logistics, et al., December 2012