Reinsurance Law Blog : Oklahoma Insurance Lawyer & Attorney : Stauffer & Nathan Law Firm

There have been some recent unpublished cases of interest which discuss landowner liability, including landlord liability to third parties for conditions on the property.  Here is a summary of some of the main points of these unreported decisions.  

An absentee landlord in Oklahoma generally cannot be held liable as the keeper or harborer of its tenant’s pets. Hampton v. Hammons, 1987 OK 77, 743 P.2d 1053; Eastin v. Aggarwal, 2009 OK CIV APP 67, 218 P.3d 523; Bishop v. Carroll, 1994 OK CIV APP 37, 872 P.2d 407.

A property owner owes a licensee a duty to exercise reasonable care to disclose to him the existence of dangerous defects known to the owner, but unlikely to be discovered by the licensee. To an invitee, an owner owes the additional duty of exercising reasonable care to keep the premises in a reasonably safe condition for the reception of the visitor, but the owner need not remove known but obvious hazards. Pickens v. Tulsa Metropolitan Ministry, 1997 OK 152, 951 P.2d 1079, 1084. In other words, a landowner owes to an invitee, as well as to a licensee, a duty to protect him from conditions which are in the nature of hidden dangers, traps, snares and the like.” “A landowner has no duty to protect a business invitee from open and obvious dangers.” McKinney, 1993 OK 88 at 9, 855 P.2d 602 at 604.

A “hidden danger” within the terms of the rule governing the liability of an owner or occupant of the premises “need not be totally or partially obscured from vision or withdrawn from sight; the phrase is used to describe a condition presenting a deceptively innocent appearance of safety `which cloaks a reality of danger.’ Pickens, 1997 OK 152 at 10, 951 P.2d at 1084 (quoting Rogers v. Hennessee, 1979 OK 138, 3, 602 P.2d 1033, 1034). See also Jack Healey Linen Serv. Co. v. Travis, 1967 OK 213, 8, 434 P.2d 924, 927. In Julian v. Secured Investment Advisors, 2003 OK CIV APP 81, 23, 77 P.3d 604, 608, this Court noted:

The Oklahoma Supreme Court has stated that “the characteristic of an item as being observable . . . cannot, by itself, require that item to be declared as a matter of law an open and obvious danger.” Zagal v. Truckstops Corp. of America, 1997 OK 75, 9, 948 P.2d 273, 275. Instead, “[a]ll of the circumstances must be examined to determine whether a particular condition is open and obvious to the plaintiff or not.” Id. (citing Brown v. Nicholson, 1997 OK 32, 8, 935 P.2d 319, 322).

The general rule is that the right of possession and control over leased premises is a fundamental requirement for ascribing liability to a landlord for injury suffered on those leased premises, but the general rule does not apply where the leased premises are open to the public. See Schlender v. Andy Jansen Co., 1962 OK 156, 0, 380 P.2d 523 (Syllabus 3); Price v. MacThwaite Oil & Gas Co., 1936 OK 562, 0, 61 P.2d 177 (Syllabus 2).

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In two decisions today the Oklahoma Supreme Court decided cases which involve police pursuits. In one, the court said the police could be liable for damages caused when the pursued vehicle causes an accident with an innocent citizen, and in the other the court held that the tort claims act did not provide immunity under the “recognized standards” exception to liability. The dissent in the first case indicates that such a change in the law should be done by the legislature, not the courts. See, State ex rel. Oklahoma Dept. of Public Safety v. Gurich, 2010 OK 56 (law enforcement could be liable for damages caused by fleeing vehicle; reckless disregard standard used) ; and Ray v. Broken Arrow Police Dept., 2010 OK 57 (the exemption from liability for "[a]cts or omissions done in conformance with then current recognized standards" did not apply, reversing summary judgment to the police department.

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In Roberts v. Printup, Ms. Roberts was injured in a one car accident. She was a passenger, her son Printup was driving. The accident was promptly reported to Shelter, the insurance company, and she received the limits of the medical payments. Eleven days before the statute of limitations ran on the claim, Roberts sent a letter to Shelter offering to settle for policy limits ($25,000) and estimating her medical bills to be in excess of $125,000. The letter said she needed a response within 10 days because of the statute of limitations. Ms. Roberts had an agreement with her attorney that if Shelter paid the claim upon demand, she would not owe any attorneys fees on the amount paid. Shelter did not respond for three weeks and then attempted to accept the offer. Ms. Roberts refused. After liability was admitted, a judge determined Ms. Roberts damages to be in excess of $1 million. Shelter paid its limits and Ms. Roberts then was assigned Printup’s claims against Shelter for the excess judgment. 

The trial court granted summary judgment to Shelter on the claims of bad faith and negligence. The Tenth Circuit reversed, affirming the dismissal of the bad faith claim, but sending back the negligence claim. See, Roberts v. Printup, 422 F.3d 1211, 1212 (10th Cir. 2005). In the first appeal, the court found that Shelter’s failure to respond to Roberts letter within 10 days was a violation of the Unfair Claims Practices Act as adopted by Kansas. In the second go around, the district court found that Shelter did not have a written policy, procedure, or mechanism in place to ensure that a claim would be acknowledged within ten working days, that Shelter was negligent in handling the letter and that Roberts was not trying to manufacture a bad faith claim. Nevertheless, the district court found that the failure to timely respond did not cause the excess judgment, thus ruling that Shelter was not liable for the excess judgment.

The Tenth Circuit reversed again. The court states:

It is readily apparent that it was foreseeable to Shelter that its negligence in failing to implement a system to handle reasonable time-sensitive settlement offers from an injured party could result in a lawsuit being filed against its insured. Accordingly, its attempt to accept the expired offer in this case did not absolve it of liability for damages to its insured caused by its earlier negligent failure to settle.

* * * *

Shelter did not give Mr. Printup’s interest the same consideration as its own or it would have set up an appropriate system to handle time-sensitive settlement offers.

The Tenth Circuit found that based on the district court’s findings, “it is apparent that it was Shelter’s failure to implement a system to handle reasonable time-sensitive offers in negligent disregard of its insured’s interest that exposed Mr. Printup to damages in excess of policy limits.” Thus, the court reversed and remanded the case with directions to enter judgment in favor of Roberts.

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