Tennessee Real Estate Law Letter

Business must protect customers from foreseeable crime

In McClung v. Delta Square Limited Partnership, 21 TAM 45-1 (Tenn., Oct. 28, 1996), the Supreme Court announced a new rule for determining when a business owner may be held liable for a criminal act occurring on its premises. Liability will arise when the owner knows or should know that crime may occur, yet fails to take reasonable steps to protect its patrons.

The wife of the plaintiff in McClung was abducted from the parking lot of a shopping center and was later raped and murdered. The plaintiff sued the center's owners, operators, and tenants, alleging negligence in not providing security. The trial court granted the defendants' motion for summary judgment, relying on Cornpropst v. Sloan, 528 S.W.2d 188 (Tenn. 1975), and the Court of Appeals affirmed. On appeal by permission, however, the Supreme Court found Cornpropst "obsolete," concluded that the plaintiff was entitled to present his case to a jury, and reversed:

The trial court and the Court of Appeals based the award of summary judgment in this case on Cornpropst v. Sloan, 528 S.W.2d 188 (Tenn. 1975), in which this Court held that shop owners owe [a very limited duty] to customers . . . to protect them against criminal acts of third parties. . . . . . . .

. . . Cornpropst established the principle in Tennessee that businesses not attracting or providing a favorable environment for crime have no duty to protect customers, unless (1) the business knows or has reason to know that criminal acts are occurring or about to occur on the premises, which (2) pose an imminent probability of harm to a customer. In determining whether the business had reason to know, the Court concluded that "[c]onditions in the area [of the defendant business] are irrelevant." Id. at 197.

. . . .

After careful consideration of the jurisprudence of other jurisdictions and our own, we adopt the following principles [in lieu of the Cornpropst rules] to be used in determining the duty of care owed by the owners and occupiers of business premises to customers to protect them against the criminal acts of third parties: A business ordinarily has no duty to protect customers from the criminal acts of third parties which occur on its premises. The business is not to be regarded as the insurer of the safety of its customers, and it has no absolute duty to implement security measures for the protection of its customers. However, a duty to take reasonable steps to protect customers arises if the business knows, or has reason to know, either from what has been or should have been observed or from past experience, that criminal acts against its customers on its premises are reasonably foreseeable, either generally or at some particular time. In determining the duty that exists, the foreseeability of harm and the gravity of harm must be balanced against the commensurate burden imposed on the business to protect against that harm. In cases in which there is a high degree of foreseeability of harm and the probable harm is great, the burden imposed upon defendant may be substantial. Alternatively, in cases in which a lesser degree of foreseeability is present or the potential harm is slight, less onerous burdens may be imposed. . . . The degree of foreseeability needed to establish a duty of reasonable care is, therefore, determined by considering both the magnitude of the burden on the defendant in complying with the duty and magnitude of the foreseeable harm. As a practical matter, the requisite degree of foreseeability essential to establish a duty to protect against criminal acts will almost always require that prior instances of crime have occurred on or in the immediate vicinity of defendant's premises. Courts must consider the location, nature, and extent of previous criminal activities and their similarity, proximity, or other relationship to the crime giving rise to the cause of action. To hold otherwise would impose an undue burden upon merchants.

Comment:

* The test for holding a business owner liable for the criminal acts of third parties is similar to the test for holding a landlord liable to a tenant. A tenant must show that the landlord had notice of a potential danger sufficient to cause a reasonably prudent person to foresee the probability of harm and a failure thereafter to take reasonable steps to correct the problem. See Tedder v. Raskin, 728 S.W.2d 343 (Tenn. App. 1987).

Copyright 1996 M. Lee Smith Publishers & Printers LLC

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