The decedent Sean King was employed by High Grade Beverage (“HGB”) when he received a fatal electric shock while attempting to replace an emergency light fixture. OSHA determined that he was working with live wires when he was electrocuted, as the circuit breaker feeding the emergency light fixture had not been turned off. The issue in The Estate of Sean King v. High Grade Beverage, Inc., 2024 N.J. Super. Unpub. LEXIS 2321 (App. Div. Oct. 4, 2024) was whether the landlord, HGB Realty 2, LLC could be held liable for the decedent’s accident.
The property was originally leased in 2011 to HGB. It consisted of a one-story, masonry, cold storage industrial complex comprising of about 72,600 square feet of warehouse, office and garage space. HGB acknowledged that it had inspected the property and was fully familiar with its condition at that time. According to the lease, the basic rent payable by the tenant was intended to be a “triple net” and all other charges and expenses imposed upon the leased premises would be paid by the tenant. In addition, according to the lease, the tenant was responsible to keep the leased premises, including but not limited to the electrical, in good condition and repair.
The original lease was apparently renewed in 2016, at which point the name of the landlord was changed to HGB Realty 2, LLC. The 2016 lease had the same provision for the tenant to keep the leased premises in good condition and repair. According to the Chief Financial Officer of HGB Realty 2, there were no circumstances in which the tenant was required to obtain approval from the landlord to perform maintenance on the property.
Perry Morris was HGB’s maintenance chief until July 2017. He was not a licensed electrician but did take a course in household wiring. While employed by HGB, Morris would perform maintenance such as changing ballasts and repairing and replacing light fixtures. Prior to his retirement, he trained decedent for about two weeks. He testified that when the building was first built, there were three electrical contractors who did not know what they were doing, resulting in circuit breaker panel labels that were not done right the first time. He and another employee attempted to correct the labels to the best of their ability and for the most part were successful.
Plaintiff submitted an expert report of an engineer, Les Winter, P.E., who opined that the decedent’s electrocution was caused by his lack of training as an electrician and the panel board directory being non-compliant and unreliable. He opined that it was not legibly marked and that decedent could not through “trial and error testing” turn off and on random circuit breakers to determine whether the fixture was de-energized.
At the conclusion of discovery, the landlord, HGB Realty 2, filed for a summary judgment. The trial court granted the summary judgment, dismissing the complaint. The trial court found that HGB’s employees knew about the electrical panel at issue, that the emergency light breaker was labeled and that Morris, who trained the decedent, did show him which switch controlled which circuit breaker.
Further, the court found that HGB Realty 2 leased exclusive control of the property to HGB and the tenant HGB knew of the condition or had reason to know of the condition prior to the decedent’s accident. It had the opportunity and indeed attempted to remedy the condition prior to the accident at issue. Thus, the trial court ruled that the landlord, HGB Realty 2, could not be held liable for the alleged defective condition. This appeal ensued.
The Appellate Division agreed with the trial court’s decision. It found that the tenant executed a triple net lease in which the commercial tenant was responsible for maintaining the premises and for paying all utilities, taxes and other charges associated with the property. Additionally, the Appellate Division noted that HGB had exclusive use of the property and that the obligation to maintain and repair the property was delegated under the lease to HGB. Further, HGB Realty 2 did not maintain an office at the property, did not actively participate, or oversee HGB’s maintenance consistent with the terms of the lease. Thus, the Appellate Division agreed that, under New Jersey law, the landlord did not have responsibility for the personal injury suffered by its commercial tenant’s employee.
