The Supreme Court of the Virgin Islands continues to take bold steps in reshaping the law of the Territory – and once again it is in a fashion that may spell difficulty for property and business owners, as well as their insurers. Yesterday, the Supreme Court handed down their decision in Machado v. Yacht Haven USVI, LLC. The decision erases a longtime distinction in the law on what duties the owners and occupiers of land owe to those on their property.
Being a younger jurisdiction with a less developed body of judicial decisions, the Virgin Islands did, for many years, heavily rely upon the Restatements of the Law to guide judicial decision-making. The Restatements are published works by experts, academics, and practitioners in all areas of the law which set forth the common principles in those areas. Since 2011, however, the VI Supreme Court has been moving away from the Restatement.
In Banks v. Int’l Rental & Leasing Corp. (2011), the VI Supreme Court stated that VI law did not require local courts to ‘mechanically apply’ the Restatement and set out a framework for determining whether the Restatement should still be followed. Then in Gov’t of the V.I. vs. Connor (2014), the Court took another step in holding that the Restatements held no sway and that it would be the ultimate authority on what is or what is not the law of the Territory.
For business owners and insurers, the changes have meant uncertainty and risk. Last year, in Perez v. Ritz-Carlton, the Court softened the requirements concerning a property owner’s constructive notice of a dangerous condition on the land. The Plaintiff no longer has to show that the property owner actually knew or had reason to know of the particular dangerous condition causing injury. Rather, the Court held, if the particular dangerous condition was one that habitually re-appeared, it was sufficient that the property owner previously knew about it. In that case, it was leaves and plant debris on a walkway. Although the Plaintiff could not show that the hotel knew about this particular accumulation – or even had reason to know of it – it’s awareness of previous accumulations was sufficient to hold it liable for resulting injury.
The current decision takes the uncertainty even farther. In the Machado decision, the Supreme Court was reviewing a grant of summary judgment from the Superior Court for a local landowner. The case involved Yacht Haven Grande, a local marina and retail complex. Ms. Machado, who was employed at a business at the facility, chose to take a shortcut through the parking lot after work. Rather than use the sidewalk, Ms. Machado walked through a curbed median with decorative plants and shrubbery. While crossing the median, she tripped and fell on a sprinkler head and was injured. She sued the marina, alleging that the sprinkler was a dangerous condition because of the lack of lighting and any warning signs.
The trial court granted summary judgment to the landowner, holding that while Machado was on the property as a licensee, her status changed to trespasser when she entered the median – as it was not an area to be utilized by pedestrians. The trial court’s decision was based upon the distinctions of invitee, licensee, and trespasser. When determining if a property owner owes a duty to warn of or correct a dangerous condition, the Restatement provides for these three types of visitors:
- Invitees are those invited to enter upon the property for business or personal reasons. While a property owner is not deemed to be the insurer of their safety, they are owed the highest duty of care under the Restatement and the property owner has a duty to make the premises safe for them, requiring an inspection of the premises and a warning or remediation of any discovered hazards.
- Licensees are those entering the property with the landowner’s permission but for their own benefit. For these entrants, the Restatement does not have the same duty to inspect but only the requirement for the property owner to make safe those dangerous conditions of which the owner is already aware.
- Trespassers are those who enter or remain upon the land without permission. It is the general rule that they are owed no duty of care under the Restatement – albeit with a good number of specific exceptions to that general rule.
In Machado, the VI Supreme Court overturned the grant of summary judgment in the trial court and erased the common law distinction between invitee, licensee, and trespasser that has long governed VI law. Instead, the Court held that, “the foreseeability of harm is the touchstone of the existence of a land possessor’s duty of reasonable or ordinary care to all premises liability actions.” The “foreseeability of harm” standard requires a more detailed analysis. One of the cases cited by the Court detailed the factors to be assessed:
(1) the foreseeability or possibility of harm; (2) the purpose for which the entrant entered the premises; (3) the time, manner, and circumstances under which the entrant entered the premises; (4) the use to which the premises are put or are expected to be put; (5) the reasonableness of the inspection, repair, or warning; (6) the opportunity and ease of repair or correction or giving of the warning; and (7) the burden on the land occupier and/or community in terms of inconvenience or cost in providing adequate protection.
Finally, the decision barred Assumption of Risk as a complete affirmative defense to a Plaintiff’s claims. Holding that the common law doctrine was in conflict with the VI’s system of comparative negligence, the Court held that while a Plaintiff’s risk-taking may be argued to the jury to increase their share of responsibility, it cannot be a bar to recovery sufficient for summary judgment.
For VI businesses, their insurers, and their attorneys this means more uncertainty. Injured persons have a greater leeway in their arguments and their cases are more likely to avoid summary judgment and earn access to the jury.
If you have any questions about the impact of Machado, please contact Mark Wilczynski at 340-774-4547 or mark@usvilaw.com.