Warning! Sidewalk Hazard

Someone slips and falls on the sidewalk in front of your building. Who are they going to sue? Until recently, they would hit up the city, sometimes for millions. No more. Now you, the co-op or condo owner, could be held liable for the fall and subsequent injuries. Not only that, but, thanks to a new law concerning liability, your insurance premiums for slip-and-fall coverage may be going up as well.

Nearly one year after Mayor Michael Bloomberg first introduced legislation to transfer liability for accidents on the city's sidewalks to private property owners, the city council has made that bill a reality, passing legislation in July transferring liability for sidewalk accidents from the city to homeowners.

The legislation, which went into effect on September 16, 2003, makes co-op and condo owners, and property owners with buildings of four or more units, fully liable for all accidents that happen on the sidewalks outside their homes. According to the mayor's office, in the past three years, the city has paid more than $189 million in judgments for liability claims for accidents caused by sidewalk defects, snow, and ice.

"Under the current law, property owners are required to keep their sidewalks in good repair and free of snow and ice. However, if they fail to comply with the statutory duty and someone is injured as a result, they don't get sued, the city does," said Bloomberg at the signing of the new law. "This legislation transfers liability for sidewalk accidents from the city to the property owners who already have the duty to keep the sidewalks in good repair." The new legislation is aimed at helping solve the city's fiscal crisis, said the mayor, saving $40 million a year.

The transfer of full liability may affect insurance rates. "What does it mean [concerning insurance]? We don't know," admits Barbara Strauss, executive vice president with York International, an insurance broker. "Will rates go up? Maybe," she says, adding: "The best advice I could give someone [is that] you [should] begin a practice of regular sidewalk inspection and repair to limit your liability."

While sidewalks are already part of a co-op's general coverage, under the new legislation co-op and condo owners and landlords have a new, affirmative obligation to make sure that their sidewalks are free of any trip hazards and move quickly to fix any problems, says James Samson, a partner with the law firm Bangser Klein Rocca & Blum.

Since the city is transferring all liability for slips and falls on sidewalks, accident victims will no longer have the deep pockets of the city to dip into, and will be looking for private property owners to make up the difference. That's one reason Samson thinks rates will increase. "If, suddenly, you are the primary obligor [on a liability claim], you can expect your rates to go up."

While some co-op advocates are concerned, Steve Greenbaum, director of property management for Mark Greenberg Real Estate (MGRE), believes the new law will have little effect on how his buildings are managed, because he says MGRE is already aggressive in fixing trip hazards when they occur.

With large complexes in Queens and Brooklyn as part of the company's portfolio, Greenbaum says his managers are always on the lookout for problems on the sidewalk. Just this past year, an 88-unit MGRE complex in Cedarhurst, Long Island, paid $11,000 for a massive sidewalk repair, part of a $28,000 project to repair the complex's stoops, steps, and sidewalks. "Trip hazards are a huge, huge issue, and we are very fastidious that we are up to insurance standards so we can attract the best prices out there."

With regard to the new legislation affecting insurance rates, "I don't really see a big shift," says Greenbaum. "In a co-op or multifamily [home] the landlord would get sued no matter what and the insurance company would have that listed as a claim. So really, it doesn't change anything for us. We still need to be vigilant that sidewalks are well maintained."

"My take on it is that nothing has changed," agrees David Khazzam, vice president of PRC Management. "The city removed itself from liability. But anytime there was a trip and fall [in the past], several parties were named in the suit, namely, the co-op itself and, maybe, separately, the city."

Prudent managing agents were always aware of potential problems on sidewalks, observes Khazzam. With the new law, buildings need to be even more proactive to make sure sidewalks are safe and free of debris. "That's something that doesn't change, whether the law has changed or not. We have been named in suits in the past and will continue to be named in suits in the future. The minute we get such claims we forward them to the insurance company."

One co-op advocate, who requested anonymity, observes that the new legislation was a trade-off between the mayor and the city council - switching liability for slip and falls from the city to co-op/condo owners was a way to keep city services, such as libraries, parks, and pools, open this summer. "What they calculated in the savings in not having to attend to the lawsuits is the reason for this legislation. This was the linchpin in saving an enormous amount of services in the city budget."