Inadequate security: the new liability crisis.

Inadequate security claims have become one of the fastest growing areas of tort liability facing companies today. Real estate companies, particularly those that manage multi-unit residential properties, have found themselves at the top of the list of most frequently sued businesses during the past decade.

"Major Developments in Premises Security Liability," a recently published study by this author and Susan J. Dunnell, found that property management companies and owners of residential sites were sued more than twice as often as any other businesses on the list. The study, which was conducted from 1983 through 1992, included over 200 cases from across the country.

A number of significant trends, both statistical and legal, were identified in this study. The following are a few examples:

* Rape and sexual assault account for the most common incident leading to a lawsuit.

* Apartment units, parking areas, and hotel rooms are the most common locations for a violent crime to occur.

* The average settlement in violent crime cases exceeded $600,000, while the average jury verdict was $1.3 million.

Premises security liability

Inadequate security is generally referred to as premises security liability--that is, the civil liability of owners for the foreseeable criminal acts of third persons.

Inadequate security claims arise when a property owner or an agent/manager fails to provide a reasonably safe environment, and as a result, someone is victimized by the criminal conduct of another person. Frequently, the assailant is known neither by the victim nor by the property owner and is never apprehended.

While premises security cases have been around for several years, they are still not as common as some more traditional torts, such as the typical "slip-and-fall" case. One of the more notable cases of premises security liability is the so-called "Connie Francis" case, brought by the singer who was raped in a motel in the early 1970s. Her $2.5 million award alerted property managers to the consequences of inadequate security.

What makes up a security program?

A uniformed guard patrolling a parking lot or screening visitors at a reception desk is only a small part of a property's security program.

To achieve an effective level of security, managers should notify residents of crime trends, control master keys, prescreen employees, repair broken locks, and take other pro-active responses to prevent crime from occurring.