What is a Landlord’s Duty to Repair Leased Premises?
(a) Under common law, a Landlord had no duty to repair the Demised Premises or the Common Areas unless that duty is included within the Lease. In New Jersey, this rule is no longer in effect with regard to residential tenancies, but still has resonance with respect to non-residential properties. This rule has so many exceptions, and a proper treatment is beyond the scope of this outline. As to New Jersey, the tilting point as regards residential tenancies came with its Supreme Court’s imposition of an implied warranty of habitability in Marini v. Ireland. 56 N.J. 130, 265 A.2d 526 (N.J. 1970).
(b) Aside from contractual liability to which a Landlord may become exposed by the terms of a Lease, courts have used a variety of tort law theories to impose duties on Landlords toward their Tenants based upon the particular Landlord-Tenant relationship. A major “safe harbor” areas for a Landlord is where a Tenant has exclusive control over the leased areas, even if the Demised Premises are residential. In fact, the general rule provides that a Landlord is not liable for injuries arising out of improper maintenance of leased property where its Tenant has exclusive control over the property. The following case law summary is instructive:
(i) A Tenant leased a single family residence. About eight months after the start of the lease, “a large tree branch from a dead tree fell on [the Tenant] while he was playing in the front yard with his dog.” Allegedly he suffered back injuries necessitating surgery. He sued the landlord, asserting his “landlord breached his duty of care to repair a dangerous condition existing on the property by not removing the dead tree.” He claimed that he and his wife discussed the dead tree with the landlord before executing the lease and again afterwards. He also claimed that the landlord agreed to remove it.
The lease was a pre-printed “boilerplate” lease. It required the “Tenant to keep and maintain the house and grounds in a neat, clean and safe condition (emphasis added) and. require[d] [Tenant] to properly notify landlord when there [were] conditions that needed repair.” According to the lease, the landlord was obligated to “repair and replace vital facilities serving the house (emphasis added).” “The longstanding rule of law as it applies to patent defects. is that a landlord is not liable for ‘injuries sustained by the Tenant or the Tenant’s invitee by reason of ruinous condition of the demised premises unless there has been fraudulent concealment of a latent defect.” Therefore, even if the landlord had notice of the dead tree, he would not have been liable to the Tenant unless one of the exceptions to the general rule applied. Those exceptions are “where the lessor contracts to repair” or “where parts of the land are controlled by the lessor, although the lessee is entitled to their use.” Neither exception applied in this case and the Tenant’s suit against his landlord failed as a matter of law. Sherlotti v. Hibbets. A-2612-03T5 (N.J. Super. App. Div. 2004) (Unpublished, December 16, 2004).
Further, the general rule is that a Landlord is not liable to its Tenant injured by a patent defect that existed before the tenancy unless the Landlord has undertaken repairs and not carried them out in a reasonable manner.
(c) In practice, Leases invariably include sets of provisions setting forth the parties’ respective repair obligations. They are frequently detailed and lengthy. Unless a Tenant has constructed its own Demised Premises or the Tenant is leasing under a sale-leaseback style of financing Lease, it is almost always the business agreement of the parties that the Landlord maintain, repair, and replace the structural elements of the building, exterior and load bearing walls, roof, and sub-floor. Most often, in those circumstances, Landlords take responsibility for utility lines outside of the Demised Premises or under the floor. Very commonly, Landlords take responsibility for shared equipment, such as electrical transformers and heating, ventilating, and air conditioning equipment. In a residential Lease, a Landlord often takes responsibility for all major repairs and often for minor ones as well. In commercial Tenancies (other than for very short durations), Tenants generally take responsibility for the maintenance, repair, and replacement of all interior, non-structural parts of the Demised Premises. Typical Lease provisions are as follows:
(i) (A) Tenant shall keep the Demised Premises and improvements in good and substantial order and repair at the sole cost and expense of Tenant, and shall make all repairs, renewals, and replacements necessary to that end, ordinary or extraordinary, expected or unexpected, except for repairs expressly required to be made by Landlord as hereinafter provided. Tenant shall also be responsible for the cost of making any repairs or replacements to, or within, the Shopping Center if the need therefor is caused by the negligent or willful act or omission of Tenant, its agents, employees, officers, contractors, invitees, or any other person or entity acting for or under Tenant.
(B) Landlord, at its own cost and expense, shall maintain and make all necessary structural repairs and replacements to the Building, including its roof and exterior walls (excluding signs, window glass and frames, and doors and door frames within or bounding the Demised Premises), exterior pipes and equipment, all electric and plumbing systems up to the point of entry into the Demised Premises, and foundation; excepted from the foregoing obligations are: (i) any repairs or replacements to alterations or improvements made by Tenant; and (ii) any repairs or replacements required by reason of the negligent acts or omissions of Tenant, its agents, employees or those acting for or under Tenant, unless, however, if such damage is covered by Landlord’s insurance, then Landlord shall either make the repairs or give Tenant such insurance proceeds to effect the repairs. As used herein, the expressions “roof” and “exterior walls” do not include roof top heating and/or air conditioning units which service the Demised Premises exclusively, the repair and replacement of which are Tenant’s responsibility.
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(ii) X.1 Except in the case where the necessity therefor is caused solely by the negligent act or omission (where there was a duty to act) of Tenant, Landlord, at its sole cost and expense chargeable to Tenant in accordance with the provisions of Article Y, shall keep and maintain the Outside Area (as defined in Section Y.1) in good condition and repair. Landlord, at its sole cost and expense, shall also maintain, repair, and replace all: (a) roofs (including the roof membranes); (b) sidewalks; (c) masonry walls; (d) foundations; (e) plumbing; (f) pipes, tubes, and other conduits and utility lines leading to or from the Premises or embedded into the structure of the Premises; (g) floor slabs; (h) exterior surfaces of the Building; and (i) structural members. Landlord shall make all structural repairs to both the exterior and interior of the Premises and the building of which it is a part (“Building”), including those made necessary by reason of fire, vandalism or other unavoidable catastrophes, regardless of whether such repairs are ordinary or extraordinary, foreseeable or unforeseeable.
X.2 During the Lease Term and any extension thereof, Tenant shall be responsible, at its sole cost and expense, for all repairs and maintenance to the interior of the Premises and the non-structural components of the storefront for the Premises, including: (a) glass windows, doors, window frames, and door frames; (b) all mechanical and electrical equipment and all plumbing
including drains and drain lines within the Premises, except for those items set forth in Section Z.1, for which Landlord is and shall remain responsible; and (c) the reasonable periodic maintenance of floor coverings. Throughout the Lease Term, Tenant, at its sole cost and expense, shall maintain the Premises in a neat and sanitary condition. Landlord agrees to provide Tenant with a warranty manual letter and to assign to Tenant all assignable warranties for all components of the Premises, including, but not limited to, for the HVAC system exclusively serving the Premises.
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(iii) [Tenant’s Drafted Provision]. Until the end of the first Lease Year, Landlord, at its sole cost and expense, shall make and pay for all repairs and replacements of Landlord’s Work, whether structural or nonstructural, including all utility lines and areas within or under the floor slab, excluding, however, damage caused by Tenant or its agents, employees or contractors. Thereafter, Landlord shall assign to Tenant all assignable warranties relating to the Demised Premises and the equipment located therein, except such warranties as may be used to cover any of Landlord’s obligations stated herein. Landlord, at its sole cost and expense, throughout the Term of this Lease, shall make and pay for: (a) all repairs, structural or otherwise, to the exterior of the Building, including but not limiting such repairs to the streets, access drives, service drives, curbs, sidewalks and alleys; and (b) all repairs to the interior of the Building which are of a structural nature and which are not made necessary by any unusual use or alteration of the Demised Premises by Tenant including, without limitation, all repairs to the sprinkler system servicing the Demised Premises); and (c) all repairs to the structure and roof (including, without limitation, the structure and roof over Tenant’s basement space, if any), the roof skin, utility lines (both exposed and unexposed), flashings, gutters and downspouts, floor slab, exterior walls, columns, beams, foundations, and footings; and (d) all repairs, remediations and other actions involving any Hazardous Material (as hereinafter defined) as required by Article X below; and (e) all repairs, structural or otherwise, to the interior of the Demised Premises made necessary by structural failures, acts of God, and the elements, and leakage or flowing of water and steam into the Demised Premises; and (f) all repairs, structural or otherwise, occasioned by losses which are covered by either Landlord’s casualty policy or by a standard fire and extended coverage policy; and (g) all necessary repairs and replacements to and servicing of the heating, ventilating and the air-conditioning systems (“HVAC System”) to maintain same in good operating condition through the first anniversary of the Rent Commencement Date. Landlord shall assign to Tenant all guarantees or warranties for the HVAC System that extend beyond the first (1st) anniversary date. At delivery of the Demised Premises to Tenant the HVAC System shall be in compliance with regulations governing fluorinated hydrocarbons and shall be delivered with refrigerants in compliance with all regulations applicable to the HVAC during the Initial Term.
Tenant agrees to make and pay for all ordinary nonstructural repairs to the interior of the Demised Premises which are reasonably necessary to keep the same in a good state of repair except such repairs as are herein provided to be made by Landlord.
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(iv) [Another Tenant’s Drafted Provision]. (A) At Landlord’s sole cost and expense and not to be included in Common Area Operating Expenses or otherwise charged to Tenant under this Lease, to remedy any latent defects relating to the Premises, including, without limitation, arising out of or relating to Landlord’s Work, and to keep all elements of the Premises in good order, repair and condition, and to replace if so required, throughout the Lease Term all elements of the Premises, including without limitation, all structural components, the roof, all gutters and all down spouts of the Premises except as set forth in Article 8. Landlord hereby assigns to Tenant (to the extent assignable) all warranties, if any, received by Landlord from contractors, subcontractors, suppliers, manufacturers, and for material for construction of that portion of the Premises which is the Landlord’s Work but which will be Tenant’s maintenance responsibility; alternatively, Landlord shall allow Tenant to enforce such warranties, if any, in Landlord’s name at no cost or liability to Landlord.
(B) Subject to Landlord’s repair and maintenance obligations expressly set forth in this Lease, to maintain and keep all non-structural portions of the Premises in a good condition and state of repair, including all equipment, facilities and fixtures therein.
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(v) [Landlord’s Draft for an Office Lease]. (A) Tenant shall take good care of the interior of the Premises throughout the Term, maintain and preserve same in substantially as good a condition as delivered to Tenant on the Commencement Date, except for normal wear and tear and damage by fire or other insured (or required to be insured) casualty or condemnation, and be responsible for all necessary repairs and replacements thereto, other than those which it is Landlord’s obligation to make under the provisions of this Lease including the those in Section X. Tenant shall not injure, deface or commit physical waste of the Premises or by Alterations performed by Tenant. Tenant shall be responsible for all damage of any kind or character to the Property and/or the Real Property caused by the negligence or willful misconduct of Tenant. Tenant shall be responsible for all damage of any kind or character to the balance of the Property and/or the Real Property caused by the negligence or willful misconduct of Tenant or Tenant’s Visitors or by Alterations performed by Tenant. Landlord shall make, at Tenant’s expense, all repairs to the Property or to the Real Property for which Tenant is responsible under Section Y, and Tenant, as Additional Rent, shall pay the reasonable and necessary out-out-pocket costs incurred by Landlord therefor to Landlord within thirty (30) days after Tenant’s receipt of Landlord’s demand.
(B) Landlord shall be responsible for all Structural Repairs at its own expense; provided, however, that Tenant shall pay as Additional Rent the reasonable and necessary out-of-pocket costs of all such repairs resulting from damage caused by the negligence or willful misconduct of Tenant or by Alterations performed by Tenant. Landlord shall maintain, repair and replace all plumbing, heating, air conditioning, electrical and mechanical fixtures (exclusive of electrical and mechanical fixtures installed by Tenant) when required, and maintain and make repairs to the Common Areas, the non-structural elements of the roof of the Building and the exterior of the Building, the reasonable cost of all of which shall be included in Operating Expenses (but only to the extent otherwise permitted to be included by this Lease); provided, however, that Tenant shall pay as Additional Rent the cost of all such repairs or replacements arising from the negligence or willful misconduct of Tenant or Tenant’s Visitors, or Alterations performed by Tenant. Landlord shall maintain, repair, and replace or cause to be maintained, repaired, and replaced, all other parts of the Real Property’s Common Areas, the reasonable cost of all of which shall be included in Operating Expenses (but only to the extent otherwise permitted to be included by this Lease); provided, however, that Tenant shall pay as Additional Rent the cost of all such repairs or replacements arising from the negligence or willful misconduct of Tenant or Tenant’s Visitors, or Alterations performed by Tenant.
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