New Jersey Court Holds Language of Lease Controls in Landlord and Tenant’s Dispute Over Sidewalk Liability

In an unpublished opinion, the Appellate Division of the New Jersey Superior Court found in favor a commercial tenant and against the landlord in an action that focused on the interpretation of the lease between the two parties to determine which party was responsible for maintenance and insurance of the common area sidewalk.

In Senatore v. Kmart Inc., plaintiff brought suit against Kmart after falling on an allegedly defective portion of the sidewalk. Kmart, the tenant, tendered its defense to Belmont, the landlord, as an additional insured under Belmont’s policy. When Belmont’s insurer rejected the tender because Belmont had neglected to add Kmart as an additional insured, Kmart filed a third-party complaint against Belmont for indemnification. The trial court granted summary judgment in Kmart’s favor, holding that Belmont breached the terms of the contract between the parties and was thus liable to Kmart for any damages resulting from the breach. Belmont appealed.

The Appellate Court analyzed the lease in place between Kmart and Belmont using the long established standard of contractual interpretation that the function of the court is to enforce the terms of the contract, which the parties themselves made, as written. In this case, the lease defined “sidewalks” as part of the “common areas” and further required the landlord to “fully maintain and keep in good order and repair the common areas of the shi=opping center and shall keep the same adequately paved[.]” Based on this language, the Court found that Belmont, as landlord, was responsible for the maintenance of the sidewalks, which was included within the common areas under the lease.

The Court rejected Belmont’s argument that Kmart was required to indemnify Belmont because the injury arose from Kmart’s use of the “demised premises.” Pointing once again to the language of the lease, the court noted that the sidewalks were not included as part of the “demised premises” and that Belmont was obligated to maintain and repair the sidewalk.

The Court further rejected Belmont’s attempt to place liability on Kmart by arguing that Kmart had a common law duty to plaintiff as a lessee in exclusive possession of premises abutting a public sidewalk to keep the walkway in good repair. Since Kmart did not have exclusive possession of the common area sidewalk and the lease placed the responsibility of maintaining the sidewalk on Belmont, the Court determined that no common law duty existed. The Court affirmed the trial court’s grant of summary judgment in favor of Kmart.