Reducing Risk of, Liability for After-Hours Crimes

Q: A shopping center near mine has experienced vandalism and at least one burglary recently. The crimes took place after hours. I’m afraid that my center will be affected next. I’ve installed more lighting in the parking lot. What else can I do to deter after-hours crimes?

A: Crimes like burglaries and vandalism against tenants are a serious problem. These crimes—which are often committed by delivery people, contractors, and even tenants’ employees who have unmonitored access to the tenant’s space after hours—could push up your insurance rates and make it harder for you to attract and keep tenants. They could also trigger lawsuits against you by tenants whose space or merchandise is damaged by a burglar or vandal.

It seems as though you’ve already taken some basic steps to prevent after-hours crime. But access to your center is a key part of reducing and preventing crime. If your leases with tenants don’t give you the right to limit after-hours access to your building or center, you’re missing a big security opportunity. And your efforts to prevent criminals from getting into your building or center after hours could be seriously undermined. Add four safeguards to your leases—two that will help you control after-hours access so you can reduce the risk of crime, and two that will help you limit your liability for after-hours crimes that do occur—in an “access outside of ordinary business hours” clause.

Reduce Risk of Incident

To reduce the risk of an after-hours crime occurring at your building or center, add the following two safeguards to your lease:

Deny access to unauthorized parties. Get the right to deny after-hours access to your building or center to: (1) anyone not recognized by your security personnel as an employee, agent, or subtenant of the tenant or a building employee; or (2) anyone without a building identification card or after-hours visitor pass. This gives you and your security personnel the power to keep strangers and unauthorized people out of your building or center. Ask your attorney about adding this language to your clause:

Model Lease Language

Tenant acknowledges and agrees that:

a. Landlord May Refuse Access. Landlord may refuse access to the [Building/ Center] outside of Ordinary Business Hours to any person not:

(i) Known to Landlord’s security personnel as an employee, agent, or subtenant of Tenant or a [Building/Center] employee; or

(ii) Having a [Building/Center] identification card or after-hours visitor pass issued by Landlord.

Owners of smaller centers may not have distributed employee identification cards or after-hours visitor passes to tenants. But they should consider doing so as soon as possible; these cards and passes offer an easy way of controlling who can have after-hours access to the building or center.

Require after-hours registration. Get the right to require that everyone who enters and leaves the building or center after hours must register with your security personnel. A registry that lists the visitor’s name and check-in and checkout times will help your security personnel keep track of who is inside your building or center at any particular time.

Model Lease Language

b. Visitors Must Register. Landlord may require all persons admitted to or leaving the [Building/Center] outside of Ordinary Business Hours to register with Landlord’s security personnel.

Limit Liability After Crime

You can’t stop third parties from suing you if they’re injured after hours by someone in your building or center—but you can protect your wallet in other ways. For example, make a tenant pay for actions of its visitors, agents, employees, and subtenants. And make the tenant agree to be liable if any of its visitors (or its agents, employees, and subtenants) cause harm to the building or center or to anyone inside the building or center. So, for example, if a tenant’s visitor rips the furniture in the lobby, the tenant must pay for the furniture repair.

Model Lease Language

c. Tenant Is Liable for Its Visitors. Tenant shall be solely responsible for all persons for whom it requests permission to enter the [Building/Center] and shall be liable to Landlord for all acts of such persons.

Make sure your lease’s indemnification clause requires the tenant to indemnify—that is, defend and reimburse you—if you’re sued by a third party in connection with any incident at your building or center caused by something the tenant or its visitors did or failed to do.

Remember to require the tenant to agree not to sue you if you—or your security personnel—let someone enter the building or center after hours who harms the tenant. Without this protection, the tenant could sue you for its injuries.

Model Lease Language

d. Landlord Is Not Liable to Tenant. Landlord shall in no way be liable to Tenant for injury or loss arising from the admission or exclusion of any person to or from Tenant’s Premises or the [Building/Center] under such provisions of this Clause.

Practical Pointer: Expect a savvy tenant to demand that you remain partially liable. It will want to be able to sue you for harm it suffers from a visitor whom you or your security personnel knew or should have reasonably suspected was a safety risk, but let into the building or center anyway.