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Utah SC finds in favor of tenants in lawsuit over arson

By Jessica M. Karmasek | May 14, 2012


SALT LAKE CITY (Legal Newsline) - The Utah Supreme Court, in a ruling earlier this month, sided with a group of tenants who blamed the owners of their apartment complex for a fire and the subsequent damage and their injuries.

The group of tenants, who resided in a complex in Ogden, Utah, sued Canyon Cove Properties LLC and Apartment Management Consultants LLC, alleging negligence.

In November 2005, an arsonist set fire to the complex, which is owned and operated by Canyon Cove and AMC. As a result, the tenants suffered property damage and personal injuries.

Later, the tenants sued Canyon Cove and AMC, alleging that the owners' negligence contributed to their damages from the fire.

Specifically, they claimed Canyon Cove and AMC were negligent because they failed to:

- Warn residents that the building did not contain fire blocking;

- Take any measures to reduce or eliminate fire hazards when they knew about a previous fire at the complex;

- Have a functional fire alarm system;

- Have security at the premises;

- Remove a couch, which served as the ignition for the fire, from a stairwell; and

- Provide adequate access to firefighters.

Canyon Cove and AMC argued they were relieved from liability because the tenants signed a residential release agreement that included a limited liability provision, or exculpatory clause, waiving the right to bring an action for negligence against them.

A lower court concluded that the agreement and the exculpatory clause did not violate public policy and were therefore "valid and enforceable."

Accordingly, it granted summary judgment for Canyon Cove and AMC.

On appeal to the state's high court, the tenants argue that the exculpatory clause is unenforceable because it violates Utah's public policy of encouraging landlords to act with care, and it falls within the public interest exception under the factors set forth in Tunkl v. Regents of the University of California.

In a unanimous opinion filed May 4, the Court reversed the lower court's grant of summary judgment in favor of the owners and remanded the case.

Chief Justice Matthew B. Durrant, who wrote the Court's 10-page ruling, cited Canyon Cove and AMC's failure to respond "meaningfully" to the tenant's claims.

"Indeed, AMC's brief largely ignores tenants' points and instead puts forth unrelated arguments that fail to address or refute tenants' position," he wrote. "Thus, without reaching the merits of the issues before us, we reject AMC's brief and accept tenants' claim that the exculpatory clause in the agreement is unenforceable."

More specifically, Durrant explained, "Instead of addressing tenants' points, it (Canyon Cove and AMC's brief) argues that the exculpatory clause is clear and unambiguous, that the fact that an arsonist started the fire weighs against finding the clause unenforceable, that tenants have not established that AMC's negligence caused their damages, and that the agreement and exculpatory clause were not contracts of adhesion."

The Court pointed to Rule 24 of the state's Rules of Appellate Procedure, which governs the content and format of briefs submitted.

In particular, Rule 24(a) requires that the argument section of a brief "contain the contentions and reasons of the appellant with respect to the issues presented."

Canyon Cove and AMC's brief "largely ignores" the points in the tenants' brief, the Court said.

"We recognize that appellants bear the burden of persuasion on appeal, but we are convinced that tenants have met their burden in this case," Durrant wrote.

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

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