New Law Points to Protection from ADA Lawsuits
With 700+ real estate professionals coming and you can't miss RealShare ORANGE COUNTY on August 18 in Irvine.
(Save the date: RealShare Apartments comes to the Westin Bonaventure, Los Angeles, October 24.)
LOS ANGELES-A victory for California’s small business owners, particularly those leasing retail space, was realized with the passing of SB1186, a bill that Gov. Jerry Brown signed into law last month. The statute is intended to cut down on shakedown demands and litigation to business owners for violations of the Americans with Disabilities Act, while at the same time increase disability access, according to David C. Bolstad, an attorney with Allen Matkins here. Bolstad tells GlobeSt.com that the law prohibits predatory requests for payment of money in demand letters to small business owners and reduces the amount of statutory damages available to plaintiffs when the defendant corrects the violation, but it still leaves some pertinent matters up for interpretation.
In addition to discouraging the mass mailing of demand letters to businesses in exchange for the payment of a small bounty, the law reduces damages if corrections that comply with ADA legislation are made within a certain time period after a noted violation. It also reduces the minimum statutory damages from $4,000 to $2,000 for small businesses per unintentional violation that has been corrected within 30 days of being served the complaint—down to $1,000 if they can also show the property was previously inspected by a certified access specialist prior to the plaintiff’s alleged encounter with the barrier to access—and it prevents stacking of claims based on how many times the plaintiff visited the place where the alleged violation took place.
“All [small business owners] need to do is show they’ve done the repair alleged within 30 days of being served with the complaint,” Bolstad tells GlobeSt.com. “It is intended to limit the damages for the small and relatively minor issues in parking lots, bathrooms and access doors that have hounded small businessmen for a long time.”
But while a step in the right direction, everyone seems to have a slightly different perception of the law, and no one knows exactly how it’s going to play out in real life, says Bolstad. “What does minimum statutory damages reduction mean? Presumably, the plaintiff can only get $2,000, but what about the plaintiff’s attorney? How much impact does that have on the monetary component to the resolution of this thing? That remains to be seen.”
Bolstad says plaintiffs’ attorneys could argue that they still put the time in on the case and should collect their fees, but who would pay them? The law also raises questions for property owners as to how to deal with indemnities relating to both common areas and leased premises.
“Typically, when a lessee gets sued for violations in the common areas, they will seek indemnity from the landlord to repair and pay for the alleged violations. Now, landlords will have to be telling their tenants if the property hasn’t been inspected by a CASp. The tenants may ask to be indemnified for violations within their lease space, and it will have property owners looking at their leases regarding liability, compliance and what tenants are responsible for if sued.”
On the positive side, the law may encourage owners to have their properties inspected by a CASp in order to protect them from liability in the case of an ADA violation complaint, thereby making more properties safer and more accessible for all.
As GlobeSt.com previously reported, a new round of changes to the American with Disabilities Act went into effect March 15. Most of these changes were innocuous, but one requirement, lifts for all public pools, may force some hotel chains to close pools for good because of cost concerns, according to Jones Lang LaSalle.
Want to learn about the retail sector? RealShare Conferences gather prominent speakers and the commercial real estate elite. Check out the 2015 events in your market.
You can now be notified via email if this story is updated by clicking on the "Follow this Story" link. You must be a registered member to take advantage of this "members only" benefit.