Liability

Why does you’re your Business need security and why is liability so important?

Premises liability claims are wide ranging – from slip-and-fall accidents to intentional shootings during a robbery. Recent cases have detailed a business owner’s liability for criminal acts conducted on their property, and the implications of the decisions are important for business owners to understand.

Premises Liability Generally

Customers of a business are considered invitees. This distinction is important because business owners must provide a higher duty of care to insure a customer’s safety.

Outside the classic hazards for slip-and-fall claims or injuries from lack of maintaining the premises, one area of liability business owners do not consider is for criminal acts of third parties.

Duty of merchants to protect invitees against criminal acts of third parties.

In Bass v. Gopal, Inc., theCourt held that a balancing test should be applied as to whether a business owner should be held liable for the criminal acts of third parties on their premises. The balancing test seeks to balance the degree of foreseeability of harm against the burden of the duty owed by a business owner. Ultimately, the Court ruled, “a business owner has a duty to take reasonable action to protect its invitees and employees against the foreseeable risk of physical harm.”

What does this mean? Under the court’s ruling in Gopal, a business owner is liable for injuries sustained by customers or employees during the course of a robbery or other criminal activity.

The concept of “foreseeability” may be troubling to some business owners. It could be argued that a business that operates in a high crime area will always have a foreseeable risk of robbery just by virtue of the business’s location. In that case, what factors should a business owner consider? Factors that may contribute to the “foreseeability” of a third-party criminal act are the presence of crimes at the business previously, similar businesses in the area, or news stories detailing a crime spree in the vicinity.

Given all of this, what sort of safety measures does a business owner need to implement in order to ensure the safety of their customers? Or, perhaps more importantly, what safety measures will meet the duty owners owe to their customers under Gopal? This question is one that is not easily answered and may require consultation with a security expert to assist in assuring that a business is taking reasonable steps to safeguard the livelihood of its customers and employees.

The Gopal decision is one that business owners should consider, as it arguably increases the likelihood of their potential liability.

In Lord v. D & J Enterprises, the S.C. Supreme Court unequivocally held that the Gopal decision applied retrospectively, as opposed to prospectively. Generally, “decisions creating new substantive rights have prospective effect only, whereas decisions creating new remedies to vindicate existing rights are applied retrospectively.” The Court decided the Gopal decision fell into the latter category, because that decision “created no new duty for business owners, but, rather, clarified the test in assessing the scope of this duty.”

This means that the balancing test in Gopal will be applied to harms that may have occurred before that decision was announced (in Lord, the court applied it to a shooting that happened in 2008; the Gopal balancing test was announced in 2011).

In Lord, the plaintiff presented expert  testimony regarding the foreseeability of the crime and whether a Armed security guard posted at the entrance of the business would have deterred the crime. Using the Gopal balancing test, the court in Lord decided that this was enough to create a question of fact for the jury and allowed for the plaintiff’s case to survive a summary judgment motion.

Impact on Business Owners

The Lord and Gopal decisions arguably make it easier for plaintiffs to survive summary judgment motions and present their case to a jury. The dissent in Lord, written by Justice John W. Kittredge, lamented that “today the Court holds that a merchant has a duty to provide a security guard where random acts of criminal violence occur miles away from the business.” Id. at 704 (J. Kittredge dissenting). The decision should make business owners think twice about the security measures they employ, the training your security company officers have, and the services it provides at your place of business.

The last thing a business owner wants is to be in front of is a jury explaining why he or she didn’t spend a little extra on Security and a jury will likely be less sympathetic to a business owner than to the wounded victim; and with a plaintiff’s ability to survive summary judgment  made easier by Lord and Gopal, this is exactly the type of situation in which business owners may find themselves in if they are not careful with who they hire to provide professional security services at their business location.