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Billing v. Deep Run Plaza

A-0676-04T5 (N.J. Super. App. Div. 2005) (Unpublished)

LANDLORD-TENANT; INDEMNIFICATION —For a tenant to be held liable for an injury occurring outside of the area for which it is responsible for under its lease, there must be a substantial nexus between the injury and the use of the premises.

A man slipped and fell on an icy walkway outside a video store. He then went inside the store and told a store employee of the dangerous condition. The store employee told the man that he was already aware of the ice and that the store would take care of it. The store’s lease required the landlord to maintain the common areas, which included the parking lot and walkways. It also contained an insurance provision which required each of the landlord and the store to carry commercial general liability insurance in which the other party was named as an additional insured. In addition, the lease contained an indemnification provision by which the landlord and tenant agreed to indemnify each other against any claims arising from a breach of the lease. The injured man sued the landlord, the store, and the landscaping company that was hired by the landlord to remove the snow and ice from the premises. The parties eventually settled and the landlord, its tenant, and the landscaping company agreed to pay the injured man. The tenant then filed a motion seeking to hold its landlord responsible for the tenant’s portion of the settlement money pursuant to the indemnification provision of the lease. It also requested attorneys’ fees. The lower court granted the tenant’s motion on the basis that the indemnification clause protected the tenant because it was the landlord’s responsibility to remove ice and snow from the common areas where the injury occurred. The landlord appealed the lower court’s decision, asserting that its tenant should be held liable for the injury because there was a substantial nexus between the pedestrian’s injuries and the tenant’s obligations to the pedestrian as its customer. In its defense, the tenant contended that, pursuant to the lease, it was responsible for obtaining insurance for injuries occurring within its premises only, and not within common areas.

The Appellate Division reversed, despite the principle that a tenant cannot be expected to provide insurance for a portion of the premises that the landlord has assumed responsibility for. In order for a tenant to be held liable for an injury occurring outside of the area that it is responsible for under the lease, there must be a substantial nexus between the injury and the use of the premises. In this case, the Court found that the pedestrian’s injury occurred on a common area that the landlord was expressly responsible for maintaining under the lease. However, it further found that there was a direct relationship between the man’s injury and the tenant’s use of its premises. At the time of the pedestrian’s injury, he was using the walkway with the intent of entering the store. As a result, the Court found that there was a substantial nexus between the man’s injury and the tenant’s use of the premises. It further held that the tenant was liable for the man’s injury pursuant to the indemnification provision of the lease. Under this provision, the tenant agreed to indemnify the landlord against liabilities arising from the conduct of its business or the negligence of its employees. It also noted that the store’s employee was negligent in failing to repair the icy condition even though he was aware that the walkway was icy.


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