SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-6211-95T3
DENNIS C. SMITH,
Plaintiff-Appellant,
v.
BERNICE YOUNG and LORRAINE
BENJAMIN,
Defendants-Respondents.
___________________________________
Submitted: December 16, 1996 - Decided: April 23, 1997
Before Judges Havey, Brochin and Kestin.
On appeal from the Superior Court of New Jersey,
Law Division, Civil Part, Union County.
Ravich, Koster, Tobin, Oleckna, Reitman &
Greenstein, attorneys for appellant (Howard N.
Wiener, of counsel and on the brief).
K. Ruth Larson, attorney for respondents
(William D. Joachim, on the brief).
The opinion of the court was delivered by
KESTIN, J.A.D.
This appeal represents yet another episode in the continuing
saga of the development of sidewalk liability law in New Jersey.
Plaintiff incurred serious injury when he slipped and fell on an
accumulation of ice on a public sidewalk in front of defendants'
property, a co-owned, two-family home in which only one of the co-owners resides, with the remaining residential unit rented to
tenants by the other co-owner.
The trial court dismissed the complaint on defendants' motion
for summary judgment, after classifying the property as
residential, and holding as a result, in accordance with the
prevailing rule, that defendants owed no legal duty to plaintiff to
maintain the abutting sidewalk in a safe condition. If the trial
court erred in its classification determination, i.e., if the
property in question is, as a matter of law, to be considered as
commercial by reason of the fact that a portion of the premises is
rented, the law imposes a duty on the owners to take reasonable
steps to maintain abutting sidewalks.
In Stewart v. 104 Wallace St., Inc., 87 N.J. 146, 157 (1981), the Supreme Court modified the previous rule of "no liability", see Yanhko v. Fane, 70 N.J. 528 (1976), 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." In Mirza v. Filmore Corp., 92 N.J. 390 (1983), the duty was held to include removal or reduction of snow and ice as well as repair.
We hold therefore that maintenance of a public sidewalk in a reasonably good condition may require removal of snow or ice or reduction of the risk, depending upon the circumstances. The test is whether a reasonably prudent person, who knows or should have known of the condition, would have within a reasonable period of time thereafter caused the public sidewalk to be in reasonably safe condition.
[Id. at 395-96 (footnote omitted).]
A lessee in exclusive possession of commercial premises abutting
the sidewalk is subject to the same duty, Antenucci v. Mr. Nick's
Mens Sportswear,
212 N.J. Super. 124, 129-30 (App. Div. 1986), but
not to the extent of absolving the landlord from responsibility.
Vasquez v. Mansol Realty Assoc.,
280 N.J. Super. 234, 237-38 (App.
Div. 1995). It is clear, however, that the duty does not extend to
the owners of residential property. Brown v. St. Venantius Sch.,
111 N.J. 325, 327 (1988); see also Liptak v. Frank,
206 N.J. Super. 336, 338-39 (1985), certif. denied,
103 N.J. 471 (1986).
The Supreme Court in Stewart foresaw that problems would arise
in close cases in determining whether a particular parcel of
abutting real estate was commercial or residential. It ordained:
"As 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." 87 N.J. at 160. The
Court specifically declared in a footnote that "apartment buildings
would be `commercial' properties covered by the rule." Ibid.
Since Stewart, there has been a quest for a bright line approach
that would serve to identify "commercial" properties covered by the
Stewart/Mirza rule and "residential" properties not subject to it.
In Hambright v. Yglesias,
200 N.J. Super. 392 (App. Div.
1985), we held that a non-owner-occupied, two-family house was a
commercial property for purposes of the Stewart/Mirza rule:
[T]he court [in Stewart] made it clear that it was
the nature of the ownership that mattered, not the
use to which the property is put. Apartment
buildings are residential in the sense that they are
places where people live; they are commercial in the
sense that they are operated by their owners as a
business. In the instant case, it is undisputed the
property was owned and operated by defendant as a
business venture. It was, therefore, a commercial
property within the meaning of Stewart and Mirza.
We express no opinion as to the result where a two-family house is partly owner-occupied.
[Id. at 395 (footnote omitted).]
The Supreme Court's subsequent decision in Brown v. St.
Venantius School, supra, 111 N.J. at 332-35, however, rested on an
analysis that differed from our approach in Hambright. See also
id. at 340-41 (Clifford, J., concurring); id. at 342-43 (Pollock,
J., concurring). In Brown, the property was operated as a private
parochial school by a not-for-profit religious corporation. The
Court emphasized that the use of the property was critical.
Beginning with the self-evident proposition that a school is not a
residential use, the Court observed that, although there might be
a question whether a not-for-profit private school should be
considered to be a commercial use, a private school run for profit
would clearly be commercial. The Court focused upon the nature of
the use, emphasizing its non-residential character and holding that
the owner's existence as a not-for-profit religious corporation had
no bearing upon its duty under Stewart/Mirza when it was conducting
an activity on the property that was not residential.
[W]e see no reason why a nonprofit private school
run by a charity should receive a greater benefit
than any other private school as against the right
of a plaintiff to recover for his or her injuries
caused by the failure of the school to maintain
properly its abutting sidewalk.
[Id. at 338.]
Soon after Brown, a Law Division decision was based upon the
proposition that "both the use made of the property and the nature
of the ownership are factors to be considered in the analysis of
whether or not property abutting a public sidewalk is commercial or
residential." Gilhooly v. Zeta Psi Fraternity,
243 N.J. Super. 201, 206 (Law Div. 1990). A fraternity house at a college was seen
as a hybrid, with residential qualities in respect of those members
who lived there, and commercial qualities akin to a social club for
members and alumni who did not. This determination was based, in
part, upon the facts that all members of the fraternity . a
nonprofit organization . paid dues used to fund social functions,
and that those who resided at the house paid additional fees for
room and board. The court went on to hold "that where property is
partially commercial and partially non-commercial the former will
take precedence in the application of the rule in Stewart." Id. at
205.
In Borges v. Hamed,
247 N.J. Super. 353 (Law Div. 1990), aff'd
o.b.,
247 N.J. Super. 295 (App. Div. 1991), defendants occupied one
residential unit in their three-family home. Relatives who paid
rent resided in the other two units. In granting defendants'
motion for summary judgment, the trial court judge relied, in part,
upon an administrative regulation promulgated pursuant to the
Consumer Fraud Act, N.J.S.A. 56:8-1 to -20. The regulation,
N.J.A.C. 13:45A-16.1, defines "residential or non-commercial
property" as
a structure used, in whole or in substantial part,
as a home or place of residence by any natural
person, whether or not a single or multi-unit
structure, and that part of the lot or site on which
it is situated and which is devoted to the
residential use of the structure, and includes all
appurtenant structures.
The trial court judge went on to stress the Supreme Court's
characterization of the property involved in Brown:
"Clearly, defendant St. Venantius School, a
private school, is not a residential property. No
one resides in the school." (emphasis added) [111
N.J.] at 332[.]
[Borges, supra, 247 N.J. Super. at 357.],
and to observe:
The Stewart case did not say that "residential"
means only single family, owner-occupied homes and
that everything else is commercial. If an owner
lives in a twenty-five unit apartment complex, that
would not change the essential commercial character
of the property. If, on the other hand, an owner
occupied one unit of a two family house, and
collected rent from the second unit, does that
modest income change the essential character of the
property from a residence to a commercial
enterprise?
[Id. at 357 (citation omitted).]
The judge "rel[ied] heavily on the fact that defendants actually reside on the premises." Ibid. He held "that an owner-occupied three family house in a residential zone, with two rental units occupied solely by family members, is `residential' property for purposes of applying the rule in Stewart." Id. at 358. In affirming substantially for the reasons stated by the trial court judge, we held that the "vertical family compound cannot be considered a commercial property." 247 N.J. Super. at 296. We observed that the record did not disclose whether the rental charged by the owners to their relatives "yield[ed] a profit or
merely cover[ed] the costs of owning and running the building," and
"[w]e [did] not consider what should be the result if defendants
lived in one apartment and rented the other two at market rates."
Ibid.
Avallone v. Mortimer,
252 N.J. Super. 434 (App. Div. 1991),
was based upon the factual premise that a portion of the owner-occupied house in question was leased as a residential apartment,
perhaps seasonally. A footnote indicated that it was unclear
"whether the portions of the premises available for lease were
occupied at the time of the accident." Id. at 436 n.1. We opined
that the treatment of hybrid uses in Gilhooly to accord precedence
to the commercial use
partially misinterprets the Brown rationale. As we
read Brown, its weighing of policy considerations
was ultimately resolved entirely on the grounds that
there simply was no residential use of the property,
and that its charitable use was not crucial in
balancing the interests of the injured party against
that of the abutting owner except as to a
beneficiary of the charity.
Thus, in the hybrid case here presented, it is
necessary for us to address the issue expressly
reserved in Hambright and Borges: what should be
the result where the owner resides in a two- or
three-family residence which abuts the sidewalk in
question?
[Id. at 437.]
We interpreted the underlying policy considerations of Stewart and
Brown as embodying "a balancing approach which resulted in the
Court's conclusion that commercial and other non-residential
entities are more readily able to pass on to their users the added
costs associated with sidewalk liability," and held that "[t]his
rationale includes owners of apartment houses and of non-owner-occupied smaller residential buildings operated for revenue
purposes." Id. at 438. We applied the balancing approach by
reversing the grant of summary judgment "to permit exploration of
the predominance of use issue by motion or trial," id. at 439,
furnishing some "clear cut examples" to illustrate how, at the
margins, the pertinent policy considerations might apply in the
balance in particular cases to determine whether a use was
"predominantly for the commercial benefit of the owner, and would
fall within Stewart as interpreted in Hambright," or was
"predominantly residential, . . . thus fall[ing] within the
exception recognized in Stewart." Id. at 438. We noted that in a
particular case,
consideration of the factors of extent of income and
extent of non-owner occupancy in terms of time and
space, should enable a trial judge to determine
whether the owner's residential occupancy
preponderates. Where there are factual disputes
respecting these factors, or where their weight is
unclear, these will require resolution by a trier of
fact.
[Ibid.]
The property involved in Wasserman v. W.R. Grace & Co., 281 N.J. Super. 34 (App. Div. 1995), was a four-bedroom house located in a residential neighborhood. We were called upon to consider whether the use of one bedroom to conduct the owner's business as a salesperson for his employer was sufficient to characterize the use as commercial for Stewart/Mirza purposes. Explicitly relying on Avallone, we once again applied the "predominance" or "primary function" test, and held that the use of a single room to assist the owner in performing his functions for a business located
elsewhere "does not convert this property, whose primary function
is residential, into a commercial property." Id. at 38. We
observed:
The determination of residential versus
commercial status cannot be based upon profit alone,
or else the status of the property would depend on
the vagaries of the marketplace. In the
circumstance of hybrid use, when the owner's
occupancy, in terms of time or space, is greater
than or equal to the rental occupancy, the property
shall be considered residential regardless of
whether the rental space generates a profit.
Avallone v. Mortimer,
252 N.J. Super. 434, 437-38,
599 A.2d 1304 (App. Div. 1991).
Therefore, the determination of status should
focus on use rather than profit.
[Id. at 39.]
Finally among the cases exploring the meaning of Stewart's
commercial/residential classification distinction, in Abraham v.
Gupta,
281 N.J. Super. 81 (App. Div.), certif. denied,
142 N.J. 455
(1995), the property at issue was a vacant lot zoned for commercial
use. The property was not adjacent to or used in conjunction with
a functioning commercial activity, as had been the case in Stewart,
which also involved a vacant lot. We held the property not to be
commercial in the Stewart/Mirza sense because "[i]t is the capacity
to generate income which is the key." Id. at 85. We saw the
contrary result in Stewart to have been ordained because, there,
"the abutting sidewalk where the fall occurred was an integral part
of a commercial enterprise" on an adjoining lot. Id. at 83. We
observed that there are two bases upon which the Stewart/Mirza rule
of liability for commercial uses is premised:
In part, liability is imposed because of the
benefits the entrepreneur derives from providing a
safe and convenient access for its patrons.
Secondly, such an enterprise has the capacity to
spread the risk of loss arising from injuries on
abutting sidewalks, either through the purchase of
commercial liability policies or "through higher
charges for the commercial enterprise's goods and
services."
[Id. at 85 (quoting Mirza, supra, 92 N.J. at 397).]
We reasoned and held as follows:
These policy considerations simply do not apply to
defendant's vacant commercial lot. The lot is not
owned by or used as part of a contiguous commercial
enterprise or business. There is no daily business
activity on the lot to which a safe and convenient
access is essential. The lot has no means of
generating income to purchase liability insurance or
to spread the risk of loss by the increase in cost
of goods sold or services rendered. Simply because
it is designated "commercial" by the City's zoning
ordinance is an insufficient basis to impose the
Stewart liability rule upon its owner.
[Id. at 85-86.]
Lest Avallone, Wasserman, and even our opinion in Borges, be seen as embracing a counting process for determining whether a property is predominantly commercial or predominantly residential, we hasten to observe that arithmetic formulas are poor vehicles for applying rules of law that are based on policy considerations. The focus must be on the qualities of the use, not upon quantity. We suggested as much in endorsing the trial court judge's emphasis in Borges upon the essential character of the property. If, in Wasserman, the property owner's employer had actually located its business in the one room of his house, as distinguished from the owner's use of the room as a home office, the result might have
been different. Certainly, the balance of factors and interests
would have been affected.
The decisional bases of Borges, Avallone, and Abraham were
fact specific, each differing from the others. In Borges, we
regarded the actual use and essential character of the property to
be controlling. Because the record did not disclose whether the
rental of two flats to family members "yield[ed] a profit or merely
cover[ed] the costs of owning and running the building," and
because, without specific proof to the contrary a "vertical family
compound cannot be considered a commercial property," we held the
owners to be exempt from the duty imposed on commercial landowners,
without "consider[ing] what should be the result if defendant lived
in one apartment and rented the other two at market rates." 247
N.J. Super. at 296.
In Avallone, we remanded for factual exploration of the
"predominance of use issue," 252 N.J. Super. at 439, in light of
the "considerations of balance and ability to pass along cost" that
flavored Stewart and Brown. Id. at 438. We did note, however,
that resolution of the issue . whether the property was maintained
predominantly for the commercial benefit of the owner . might be as
much a matter of degree as substance, i.e., the extent to which the
income generated offset the carrying costs of the property. Ibid.
In Abraham, the emphasis was on present value and current use.
In the absence of ongoing business activity to which safe and
convenient access was essential, and any existing ability to spread
the risk of loss, we saw the underlying rationale of Stewart to
require that the property owner be held not to be liable. The
classification of the property as commercial for land use purposes
was seen to have no bearing.
The quest for definition reveals how unedifying the Stewart/Mirza commercial-residential classification distinction is. See Brown, supra, 111 N.J. at 339-341 (Clifford, J., concurring) and id. at 341-44 (Pollock, J., concurring). And, ever more exotic hybrids of ownership and use, such as this case involves, point up the futility of the pursuit.
Analysis of the cases decided since Stewart and Mirza discloses that the commercial-residential distinction is not workable because too many variables are at play. There are non-residential uses that are not commercial in character as that term is commonly understood, see Brown, supra, 111 N.J. at 332-34, and commercial properties that are seen not to embody qualities generally associated with business holdings, see Abraham, supra, 281 N.J. Super. at 85-86. Yet, to speak, instead, only of residential and non-residential uses would tend to undervalue the fact that some residential uses, such as apartment houses, are distinctly income producing in character and, therefore, at least in one sense of the term, commercial or business properties. See Stewart, supra, 87 N.J. at 160 n.7. Further, although some nominally commercial uses cannot realistically be regarded as having truly commercial characteristics, see Abraham, supra, 281 N.J. Super. at 85-86, there exist other, non-commercial uses which
have been labelled commercial because they mimicked commercial
enterprises, see Brown, supra, 111 N.J. at 332-34; Gilhooly, supra,
243 N.J. Super. at 207, or because of the potential for realizing
some net return after paying the expenses of upkeep, see Hambright,
supra, 200 N.J. Super. at 395, even if only from a single tenant,
see Avallone, supra, 252 N.J. Super. at 438-39. Along the lines of
economic benefit, no case has yet reflected upon the extent to
which, if at all, the investment value of a particular tract may
bear upon the classification determination.
As we have previously observed, the rationale upon which the
Stewart/Mirza rule is based may have less to do with the character
of the use to which the property is put, or even specifically
whether the owner makes a profit, than it does with whether the
owner has a fair opportunity to spread the costs of liability. See
Avallone, supra, 252 N.J. Super. at 438; Abraham, supra, 281 N.J.
Super. at 85. But see Bligen v. Jersey City Housing Auth.,
131 N.J. 124, 136 (1993) (regarding as insignificant some practical
limitations on the property owner's ability to spread the costs).
In general, commercial enterprises, including those devoted to
residential uses such as apartment houses, can efficiently spread
the costs of liability among those who pay for the facilities
provided, such as customers and tenants. In non-multiple-dwelling
housing situations, however, the opportunities for cost-spreading
are minimal or non-existent. Sometimes there is no cost-spreading
opportunity at all; only the possibility of assigning the cost from
the non-residential owner to a single tenant of rental premises,
as, for example, in the rental of a one-family home or, as here, in
the rental of one flat in an owner-occupied, two-family home in the
peculiar circumstances depicted.
In Hambright, which involved a non-owner-occupied, two-family
home, we held the ownership to be commercial; the cost could be
"spread," however minimally, between the two tenants. Yet in
Borges, where the cost could also be spread between two tenants, we
held the property to be essentially residential because the owners
lived in a third unit and the tenants were related to them.
Gilhooly can be read as fully comporting with the cost-spreading rationale, however. Although a major aspect of the
fraternity house's use was residential, a number of tenants or
residents were involved. When coupled with another use to which
the property was put, that of a social club, the cost-spreading
potential was enlarged. Despite the Gilhooly court's
characterization of the latter use as commercial, there was
apparently no evidence that it was intended to generate profit, a
purpose that would have been at variance with the not-for-profit
status of the owning entity. Further, as Brown teaches, the not-for-profit status of the owner has no bearing upon the
classification determination. 111 N.J. at 338.
Our experience with the classification problem suggests that
the holding in Stewart is a rule in search of a definition. More
significantly, the basic premise from which it proceeds is unknown.
Does the Stewart/Mirza rule establish a commercial exception to the
"no liability" rule of Yanhko, or does it create a new liability
rule for all property except that which is residential? Under the
first approach, a property owner is not liable unless it is
established that the property is commercial. Borges, Avallone, and
Abraham may be seen as examples. Under the second approach, the
property owner is held liable if it cannot be established that the
property is residential. Brown and Hambright may be regarded as
examples. What elements of proof a rule entails and who is to bear
the burden are important considerations that ought not to depend
upon vagaries of fact on a case by case basis.
The Stewart/Mirza rule also creates significant ancillary
problems, apart from those of direct interpretation and
application. For example, if a property owner who resides in a
two- or three-family home and rents the other flat or flats at
market rates, is considered, as a matter of law, to be engaged in
a commercial use, it may be that the owner will experience
difficulty in obtaining coverage under a homeowner's insurance
policy which contains a business pursuits exclusion,
notwithstanding that the property is used only for residential
purposes. See Wickner v. American Reliance Ins. Co.,
141 N.J. 392,
399-401 (1995).
Other anomalies exist, as well. The Supreme Court's Yanhko v.
Fane "reject[ion of] the thesis that a municipal sidewalk ordinance
creates a tort duty owing to passersby on the public passageway,"
70 N.J. at 536, perpetuated a particularized limitation on a
venerable rule of law that permits an injured plaintiff to use
violation of a legislatively established standard "as evidence of
negligence for the consideration of the jury," Fortugno Realty Co.
v. Schiavone-Bonomo Corp.,
39 N.J. 382, 392 (1963), as long as the
plaintiff was "one of a class for whose benefit the statute was
enacted." Id. at 391. See also Carlo v. Okonite-Callender Cable
Co.,
3 N.J. 253, 264 (1949); Evers v. Davis,
86 N.J.L. 196, 204-05
(E. & A. 1914). A few years after Yanhko, however, in Carrino v.
Novotny,
78 N.J. 355 (1979), dealing with the effect of a municipal
ordinance, the Supreme Court revitalized the general rule, which
has since been recognized and applied in a variety of
circumstances, most recently in Williamson v. Waldman,
291 N.J.
Super. 600, 607 (App. Div.), certif. granted,
147 N.J. 259 (1996),
and Hoagland v. Gomez,
290 N.J. Super. 550, 554 (App. Div. 1996).
See also Waterson v. General Motors Corp.,
111 N.J. 238, 263
(1988).
It remains beyond peradventure "that municipal ordinances do
not create a tort duty, as a matter of law." Brown, supra, 111
N.J. at 335. To hold that they do would be to misapply the general
rule employed in Carrino. For example, a plaintiff's cause of
action cannot be based upon the specific duty to remove snow and
ice imposed by municipal ordinance enacted pursuant to the statute
which empowers municipalities to require landowners or tenants "to
remove all snow and ice . . . within twelve hours of daylight."
N.J.S.A. 40:65-12. Rather, such a claim must be premised upon the
classic general duty of a possessor of land to make only reasonable
uses of his property, "so as to cause no unreasonable risks of harm
to others in the vicinity." Prosser on Torts, § 57 at 386 (5th ed.
1984). Since this general duty extends even to persons outside the
premises, ibid., it may be taken to apply, as well, to persons on
those portions of the property over which there is a public
easement. Applying the statutory snow and ice removal standard in
the limited manner employed in Carrino merely provides a plaintiff
with a basis for establishing that the failure to remove snow and
ice was unreasonable in the circumstances established and,
therefore, negligent. See also Liptak, supra,
206 N.J. Super. 336.
Where a case arises in a municipality which has adopted an
ordinance pursuant to N.J.S.A. 40:65-12, a properly situated
plaintiff, see Hoagland, supra, 290 N.J. Super. at 553-54, ought to
have the benefit of the general rule of tort law that permits him
or her to use the statutory standard as a basis for persuading the
finder of fact that the defendant acted unreasonably in the
circumstances. The Supreme Court's articulation in its most recent
case involving sidewalk liability, Brown, supra,
111 N.J. 325, may
be taken to embody this idea. Brown's emphatic exclusion of a
rule-of-law approach, id. at 335, seems also to suggest that the
evidence-of-negligence methodology may be appropriate.
As we focus on the classification problem, we must be mindful
of the Supreme Court's observation in Mirza, supra,
92 N.J. 390,
395:
In many respects, the duty to remove snow and ice
is more important and less onerous than the general
duty of maintenance imposed in Stewart. Snow and
ice pose a much more common hazard than dilapidated
sidewalks. The many innocent plaintiffs that suffer
injury because of unreasonable accumulations should
not be left without recourse. See Stewart, [supra,]
87 N.J. at 155, 157. Ordinary snow removal is less
expensive and more easily accomplished than
extensive sidewalk repair.
It may well be, in terms of the policy considerations that inform
rules of law defining tort rights and duties, that the subject
matter area of sidewalk liability, as addressed to date, too
broadly merges conceptions that are very different and ought to be
separately dealt with. In matters involving snow and ice,
especially, it may be well to consider applying the time-tested
general rule so aptly employed in Carrino.
Justices Clifford and Pollock, although disagreeing on the
basic issue of sidewalk liability, have expressed similar views on
the unwisdom and inutility of treating residential property owners
differently from the owners of commercial property in this regard.
Brown, supra, 111 N.J. at 340-41 (Clifford, J. concurring); id. at
342-43 (Pollock, J. concurring). Our experiences since
Stewart/Mirza with the problems of classifying particular uses are
testimony to their prescience.
Finally, although the principles we have applied from time to
time in the classification cases that have come before us since
Stewart/Mirza have worked to resolve the issues presented in each
case, all were crafted to deal with the facts of each case. None
applies neatly to the facts of this matter, or to any other case
with different facts. A principle that cannot be applied to more
than a single case is more like a tautology than a rule of law.
Here, the property is a co-owned, two-family home, unquestionably residential in use. One of the co-owners, defendant
Young, occupies the first floor, and has been living on the
property for more than twenty-five years. She considers herself
the owner of that portion of the property in which she resides.
The co-owner of the remaining interest in the property is the
estate of Ms. Young's sister, defendant Lorraine Benjamin, who died
before plaintiff's injuries occurred, and who lived on the second
floor before her death. At the time plaintiff's injuries occurred,
the estate's co-ownership interest in the property was managed by
Deborah Benjamin, Lorraine's daughter, an Ohio resident. Deborah
Benjamin rented out the second floor to tenants and collected the
rent on behalf of the estate. The record does not disclose the
amount of rental that was paid or the costs of upkeep for the
property. Ms. Young had undertaken to see to matters involving
maintenance and repair of the property, including hiring a handyman
to clear the sidewalk of snow and ice. General costs of
maintenance and repair were divided between the co-owners.
The property at issue is distinctly residential in the common
understanding of that term. Just as the activities of the private
school in Brown had no residential characteristics, the uses here
have no real commercial qualities. We may choose to label rental
of a single flat, presumably at market rates, as commercial for
Stewart/Mirza classification purposes, but doing so does not
transform the activity, as a matter of fact, into a business. Even
if we were to remand, as we did in Avallone, for findings whether
the rental income exceeds the carrying costs of the property . an
artificial determinant at best . the essentially residential nature
of the use would remain unchanged. And how, in the peculiar facts
of this case, would the calculation be made? Would the rental
income of the tenanted flat be balanced against the whole of the
carrying costs even though half of those costs are borne by a
residing owner who receives none of the rental income? Is only
half of the rental income to be balanced against the half of the
carrying charges borne by the owner who receives all of the rent?
Would either approach, or any other, be a real basis of decision,
or would it be one artificially created to deal with the apparent
equities of the particular situation in the light of a dictated
need to classify the property? These are only some of the
questions raised by the special facts of this case. We resist
articulating an approach, as we have done in the past, good for one
case and that case only.
Further, although the result reached in Avallone . a remand
for factual exploration of the predominance of use issue . seems
attractive, it would only transfer the responsibility for dealing
with an intractable problem, which is especially difficult on the
facts of this case, to the trial court and the parties. And it
would sponsor an arithmetic approach to such problems which we
regard as inappropriate.
Nevertheless, Stewart requires that the property be
classified. Stewart itself provides a beginning point: "For
example, apartment buildings would be `commercial' properties
covered by the rule." 87 N.J. at 160 n.7. Yet, if the term
"apartment house" is understood strictly, as previously defined in
case law, it would apply to every dwelling of two or more stories.
An apartment house has been defined as a building
consisting of more than one story, designed so that
on each floor there are one or more suites of rooms
fitted for housekeeping purposes, including a
kitchen or kitchenette in each housekeeping unit.
Lignot v. Jaekle, 72 N.J. Eq. 233, [238-41] (Ch.
1906).
[Schermer v. Fremar Corp.,
36 N.J. Super. 46, 52
(Ch. Div. 1955).]
See also Koch v. Gorruflo,
77 N.J. Eq. 172, 174 (Ch. 1910);
Skillman v. Smatheurst,
57 N.J. Eq. 1, 4-7 (Ch. 1898).
It is clear that the Supreme Court did not intend so broad a
focus. Rather, its reference to "apartment house" seems to be in
keeping with common usage, connoting a multiple-family dwelling
which is owned for the purpose of providing a net monetary return.
We must also accord adequate emphasis to the Court's cost-spreading
rationale and its concentration on the costs of doing business:
We recognize that the rule adopted today will
increase the expenses of many businesses, and will
be proportionately more burdensome to small firms
than to large ones. However, we anticipate that
appropriate insurance will become available and that
the cost of such insurance will be treated as one of
the necessary costs of doing business.
[Stewart, supra, 87 N.J. at 160.]
Further, we must give full effect to the Court's reliance on common
understandings when it declared:
As 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.
[Ibid.]
With these perceptions in mind, and with the benefit of
hindsight regarding the fruitless search for portable
classification criteria, we now conclude that, while the Supreme
Court may have intended to include property solely held for
investment purposes within the Stewart rationale, it had no
intention to subsume small owner-occupied dwellings, such as two
or three-family homes, within the classification of commercial
property. Such uses are clearly in a category of their own, for
they are residential both "in the nature of their ownership" as
well as in "the use to which the property is put." Hambright,
supra, 200 N.J. Super. at 395. The property at issue here, being
an owner-occupied, two-family home is clearly within the exempted
category, absolving the owners from the duty to maintain abutting
sidewalks under currently prevailing standards.
We are aware that this holding does nothing to resolve the
classification issues regarding all non-owner-occupied properties
and those that are owner-occupied but accomodate more than two or
three families. The lingering difficulties that the currently
prevailing rule imposes will persist as long as courts are required
to classify properties according to the existing
commercial/residential dichotomy.
Affirmed.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-6211-95T3
DENNIS C. SMITH,
Plaintiff-Appellant,
v.
BERNICE YOUNG and LORRAINE
BENJAMIN,
Defendants-Respondents.
_________________________________________________________________
BROCHIN, J.A.D., (dissenting)
Since I am unable to perceive any current justification for the rule insulating owners of purely residential property from liability for injuries resulting from their negligent failure to clear ice and snow from abutting sidewalks, I would restrict our application of that rule to the narrowest possible compass consistent with the deference which we owe to decisions of our Supreme Court. In my view, those decisions require no more of us than to hold that the owner of property which is used solely as the owner's own residence is exculpated from liability. I do not believe that we are obligated to extend that exculpatory rule to an owner of property which produces any significant amount of income. To the extent that decisions of our court may suggest a contrary result, I would not follow them. Accordingly, I would not extend the exculpatory rule to this case. I would therefore
reverse the judgment appealed from and remand the case for trial.