Premises Liability: Important Differences between Business Owners and Out-of-Possession Landlords

Georgia's primary premises liability statute is O.C.G.A. § 51-3-1, which requires the "owner or occupier" of land to keep his premises and approaches safe for those he "induces or leads" to come onto the property. These people are termed "invitees" and they are entitled to certain protections. In Georgia, our seminal case controlling the duties of a landlord is Robinson v. Kroger, 222 Ga. App. 711, 476 S.E.2d 29 (1996).

Most lawyers are very familiar with owner/occupier liability and the so-called "premises liability statute." O.C.G.A. § 51-3-1 is typically the first statute cited in any Complaint involving an individual who is injured on a premises. However, not all premises owners are created alike.

Consider a standard strip-mall. An individual walks across the parking lot, opens the door of her favorite shoe store, and steps inside. As soon as she enters the store, she trips on a shoe-sizing device which a careless employee has left on the floor, and breaks her arm. Is the shoe store responsible for its customer's injuries? Very likely; after all, the shoe store is an "occupier" which invited a customer onto the property, then allowed a hazard to remain in place right where someone might trip over it.

But what about the owner of the strip mall? Is it fair to expect the owner of the premises, who has leased space to the shoe store, to police everything the shoe store staff do? Probably not, and Georgia law recognizes this possibility with a different statute. O.C.G.A. § 44-7-14 is often called the "out-of-possession landlord" statute. It stipulates that when a landlord has "fully parted with the possession and the right of possession" to a leased space, which is an everyday occurrence when commercial property is rented, then the landlord "is not responsible to third persons for damages resulting from the negligence or illegal use of the premises by the tenant." The only way the strip mall owner in our example could be liable is if the tenant's invitee's injury arose from "defective construction" or the failure to keep the premises in repair.

Georgia case law provides guidance on how far the land owner's duty "to keep the premises in repair" extends, but in the example of our shoe store, the premises owner might have a good argument for summary judgment. The shoe sizing device left on the floor is neither a construction defect nor a repair issue of which the landlord should have been aware. However, questions remain: is the store owner truly an out-of-possession landlord, or does it have some ownership interest in the shoe store as well? The landowner's right to qualify for the "out of possession" protections offered by O.C.G.A. § 44-7-14 could turn on that question. The answer may not be determined until the parties have conducted discovery and/or had a detailed discussion with their client about just how close a relationship this might be.

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