Injuries to potential buyers and brokers while viewing property are not uncommon. This article explores the liability of owners to invitees to a resale property and to houses under construction.
Open Houses and Showings
Homeowners are generally responsible for exercising reasonable care to make a property safe for those invited onto it. This general duty to make a property reasonably safe includes repairing dangerous conditions that are known or could be reasonably discovered by the homeowner or warning guests of their existence.
However, to recover for an injury suffered on and because of someone else’s property, the injured party must have been exercising “ordinary care” when they were nonetheless hurt.
Georgia common law follows a modified comparative theory of negligence, where the law aims to place the burden of an injury on the party best situated to have avoided it. In other words, an injured party can only recover damages for an injury if the party was comparatively less at fault for the injury than the person being sued. The law only requires that the owner or occupier of land ensure that the property is safe enough that a person who does manage to hurt herself is comparatively more to blame for her injury than the owner or occupier of the land.
Does a property owner owe a special duty to someone who may come on to listed real estate solely because of having seen a “For Sale” sign. This issue came up recently in two separate instances in which homes were listed for sale and “For Sale” signs were placed in the yards. Two different buyers saw the signs and decided to walk onto the properties on their own to have a look around. Both suffered significant injuries when, for one a deck, and for the other a stairway fall. They both sued, claiming that the owners owed them a duty to warn about the defective conditions; even though the owners had no idea these prospects were on the properties. As if often the case, there are two appellate decisions in Georgia addressing similar issues, both of which reach opposite conclusions.
The safest course is for owners to post warnings or rope off areas of the property that might be unsafe, no later than when a “For Sale” sign is placed on their property.
Liability of Agents and Affiliated Agents for Not Exercising Reasonable Care
Some states hold brokers personally liable for injuries suffered by those viewing a property if the broker or affiliated agent failed to exercise reasonable care to make a property safe for those invited onto it. Although Georgia has not done so, Georgia courts may well do so in future.
Listing Brokers Should Visually Inspect and Recommend Repair of Hazards
To be protected from this potential liability, listing agents should perform a thorough visual inspection of the property before inviting anyone to view it. If any potentially hazardous conditions are identified during this inspection, the listing agent should then require the seller to make all such hazards reasonably safe in light of their foreseeable future uses. The owner should be encouraged to fix all of these issues prior to inviting potential buyers onto the property, to ensure that no liability arises. Brokers should perform this preliminary inspection for hazards irrespective of any disclosures or promises of the owner, as the “duty to inspect” is imposed on the owners and probably includes sellers’ brokers and their affiliated licensees. (Georgia courts have ruled both ways.)
A broker or owner is not required to discover nor disclose every possible latent defect in the property during this inspection. Instead, he must exercise “reasonable care” to make the property safe in light of the foreseeable use thereof.
Examples of potential hazards to look for during this initial inspection include things like rotten stair treads or decking, broken or loose railings or burned-out lights, loose carpet or hanging fixtures, tripping hazards such as uneven sidewalks, exposed wires, and any other conditions on the property that could foreseeably lead to injury.
Warning About Any Lingering Dangers
In addition to performing a thorough inspection for dangerous conditions, brokers should make sure to give enough warning about any lingering dangers the owner neglects to fix so that those invited onto the property can easily avoid those dangers. If, for example, before an open house a broker notices that a two-story deck has rotten floorboards, that broker should make certain that no one who attends the open house goes out on the deck, or if the buyer is insistent, at least does not go without first being warned of the potential danger.
The broker could communicate the warning in several ways, including posting a written sign, verbally warning potential buyers, physically restricting access to the deck by closing the deck off entirely, or doing all of the above. Perhaps the easiest way for brokers to limit their liability in this situation is to provide a written disclosure listing all known latent dangers to each prospective buyer and require each such buyer to sign it immediately before they enter the property. While not the most positive sales technique (except in the case of extreme “fixer-upper” properties where buyers may be enticed by a laundry list of defects), if any injury does result there is written proof that the broker exercised ordinary care by warning the victim of the danger beforehand, and that the victim was probably not exercising ordinary care since he or she clearly ignored that warning. A sample of this type of disclosure is as follows:
The undersigned prospective buyers acknowledge that they have been informed of the following dangers and agree to use extreme care to avoid these potentially hazardous conditions: [LIST OF KNOWN DEFECTS]. The previous items are not meant to be an exhaustive list of all dangerous conditions on the property, but rather are those known to the owner/broker based on a visual assessment of the property.
Houses Under Construction
Houses that are under construction present a heightened risk of injuries. Most builders will not let buyer’s tour homes under construction until the house is almost complete to avoid the risk of claims. If tours are allowed, prospects and buyers are generally required to have a builder or builder representative on the tours.
Remember that Georgia is a comparative liability state. If a prospect or a broker goes onto a property without permission, that person may not be able to recover for an injury. That is, the injured party may be more at fault than the owner.
Reference: Weissman, Seth. The Red Book on Real Estate Contracts in Georgia (pp. 60-65). BookBaby. Kindle Edition.
Real Estate News, Brokers Blog & More