Prior to 1981, both commercial and residential landowners in New Jersey could not be held liable for injuries occurring on public sidewalks abutting a property, except for the negligent construction or repair of the sidewalk, wherefore direct use or obstruction of the sidewalk by the owner in such a manner as to render it unsafe for passersby. In 1976, the New Jersey Supreme Court revised that principle and held that commercial landowners could be liable for injuries sustained on the sidewalk adjacent to properties. The Court recognized the arbitrariness of holding commercial property owners responsible for injuries sustained within a commercial building but finding no liability when an injury was incurred a few feet from the businesses' door.
The Court recognized that residential property owners stand on different footing than commercial owners who have the ability to spread the cost of the risk through the current activities of the owner. The Court underscored that the commercial/residential dichotomy represents a fundamental choice not to impose sidewalk liability on homeowners.
With regard to the commercial/residential distinction, Associations must be cognizant of potential liability in the event that there are both commercial and residential owners who are members of the Association. By way of example, an Association comprised of a combination of retail space and residential units typically found in shopping districts in urban areas, might be considered “commercial property” for purposes of sidewalk liability depending on the facts of the case, and the nature/extent of the commercial use. In such “mixed use” scenarios, the Association must be aware of and cognizant of the potential that it could face “sidewalk liability” if a Court were ultimately deem it to be a “commercial” property owner. Such Associations would be wise to consult an attorney and insurance professional to explore this potential liability, and to take the necessary steps to protect itself.