Submitted April 8, 2013
On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-9532-10.
Ginarte, O'Dwyer, Gonzalez, Gallardo & Winograd, LLP, attorneys for appellant (Michael A. Gallardo, of counsel and on the brief; John J. Megjugorac, on the brief),
Burke & Potenza, P.A., attorneys for respondents (John D. Potenza, of counsel and on the brief; Pilu D. Patel, on the brief).
Before Judges Parrillo, Fasciale and Maven.
Plaintiff appeals from an April 13, 2012 order granting summary judgment to Maria Floro and Jose Martins (defendants) and dismissing his personal injury slip and fall complaint. Under the unique facts of this case, we remand for further proceedings.
In reviewing a grant of summary judgment, we apply the same standard under Rule 4:46-2(c) that governs the trial court. Wilson ex rel. Manzano v. City of Jersey City, 209 N.J. 558, 564 (2012). We must "consider whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995).
Plaintiff asserts that Floro converted her owner-occupied two-family-zoned house into a basement-owner-occupied three-family house. He contends that Floro did so to generate additional rental income. The question is whether the property is considered "commercial" or "residential" for purposes of establishing sidewalk liability pursuant to Stewart v. 104 Wallace Street, Inc., 87 N.J. 146, 157 (1981). If the property is deemed to be an owner-occupied two-family house, then our decisions since Stewart have generally held that the property is considered to be residential, as that term is commonly applied. We do not disturb that precedent. Because there are unresolved and disputed factual issues regarding the nature of the ownership and the use of the property, we direct the judge to analyze the residential-commercial distinction.
Floro owned a two-family house. When she purchased the house, she lived on the second floor with her now-estranged husband, Martins, and their son. At that time, she rented the first floor to a tenant, and the basement was unoccupied. This arrangement would typically be considered an owner-occupied two-family house. Floro certified, in support of defendants' motion for summary judgment, that she experienced "financial difficulties, " and as a result, she and her son relocated from the second floor to the basement, thereby freeing up the second floor to rent to another tenant. As a result, she generated twice the rental amount. It is unclear from this record whether Floro relocated to the basement before the accident occurred, and for how long she remained there. Plaintiff argues that Floro changed the nature of her ownership of the property and used it essentially like a business. He contends therefore that the classification is commercial.
Plaintiff walked on a sidewalk abutting Floro's property, slipped and fell on ice, and sustained a bimalleolar fracture of his right ankle. His permanent injury required two open reduction surgeries with internal fixation. He sued defendants seeking compensation for the injuries he sustained that were caused by the icy condition.
Defendants moved for summary judgment. They contended that in Smith v. Young, 300 N.J.Super. 82, 100 (App. Div. 1997), we created a bright-line rule that all owner-occupied two- and three-family houses are considered "residential" for purposes of sidewalk liability law, and argued that they therefore had no duty to remove the ice from the sidewalk. The judge granted defendants' summary judgment motion, relying on Luchejko v. City of Hoboken, 207 N.J. 191, 211 (2011) (holding that a condominium complex is considered residential), and "the legion of cases [that the Luchejko Court cited]."
On appeal, plaintiff argues that the judge misapplied the governing law on sidewalk liability. He contends that Smith did not establish a bright-line rule that all owner-occupied two-and three-family houses are considered "residential, " thereby obviating any tort duty owed to innocent third parties to clear abutting sidewalks from ice and snow. He asserts that, at a minimum, the judge should have conducted a hearing applying the predominant use analysis that we employed in Avallone v. Mortimer, 252 N.J.Super. 434, 438 (App. Div. 1991) (stating that where a residential property is partially owner-occupied and partially rented, the "applicable considerations of balance and ability to pass along cost require that the residential sidewalk exception be continued for owner-occupants whose residency is established to be the predominant use").
We start by addressing the law governing sidewalk liability. From 1981 to the present, the New Jersey Supreme Court has rendered several opinions requiring classification between residential and commercial property owners. For three decades the courts have embraced the fundamental notion that residential property owners are not liable for sidewalk injuries. The Court's decisions have consistently reflected that residential property owners differ from commercial property owners who have the ability to spread the cost of loss that an innocent third party may suffer.
In Stewart, supra, 87 N.J. at 157, the Court balanced relevant tort law considerations, and held that "commercial landowners are responsible for maintaining in reasonably good condition the sidewalks abutting their property and are liable to pedestrians injured as a result of their negligent failure to do so." The Court confined this duty solely to owners of commercial property and deliberately did not extend sidewalk liability to residential property owners. Id. at 159 n.6. As a result, before determining whether a duty to maintain a sidewalk exists, one must first discern whether the property in question is "commercial" or "residential."
The Stewart Court explained that "[a]s for the determination of which properties will be covered by the rule we adopt today, commonly accepted definitions of 'commercial' and 'residential' property should apply, with difficult cases to be decided as they arise." Id. at 160. Providing an example of "commercial" property, the Court stated that an apartment building is considered "commercial" and would be covered by the Stewart rule. Id. at 160 n.7. Two years later, the Court expanded the obligation to maintain public sidewalks abutting commercial properties to include snow and ice removal. Mirza v. Filmore Corp., 92 N.J. 390, 395 (1983).
In 1988, the Court repeated its statement that commonly accepted definitions of "commercial" and "residential" apply when classifying whether property is covered by the Stewart rule. See Brown v. St. Venantius Sch., 111 N.J. 325, 332, 338 (1988) (determining that a private school operated by a nonprofit religious corporation falls within the "commercial" property category). The Court reaffirmed its assertion in Stewart that the exercise of distinguishing between "commercial" and "residential" is done "'with difficult cases to be decided as they arise.'" Id. at 332 (quoting Stewart, supra, 87 N.J. at 160). In other words, we have employed a case-by-case, fact-sensitive analysis to resolve the commercial-residential distinction.
In Dupree v. City of Clifton, 175 N.J. 449 (2003), the Court affirmed, for the reasons that Judge Newman expressed in our reported decision, the approach we used to classify whether a church owned by a religious or other nonprofit organization is considered "commercial" or "residential." Under the facts of Dupree, we focused on the use of that property to determine whether to impose liability. Dupree v. City of Clifton, 351 N.J.Super. 237, 245 (App. Div. 2002). There, Judge Newman summarized, in general, the classification method that we have employed to resolve the "commercial" and "residential" distinction since Stewart, and remarked that
[t]he objective in creating the commercial property exception to the no-liability rule was to impose liability upon the party in a better position to bear the costs associated with that imposition. [Stewart, supra, 87 N.J.] at 158. Commercial landowners have that ability as well as the ability to distribute those costs. Ibid. Thus, when determining ...