How a $140M verdict is shaping landlord liability in Georgia

In a case that is shaping landlord liability statewide, the Georgia Supreme Court is considering whether to restore a $140 million jury verdict against an Atlanta apartment complex where a tenant died in a 2017 blaze.

The court’s justices heard arguments Wednesday in a lawsuit brought against Venetian Hills Apartments, one of many troubled complexes identified in The Atlanta Journal-Constitution’s ”Dangerous Dwellings” investigation.

A DeKalb County jury found in late 2023 that the apartment complex was liable for the death in 2017 of George Hughes, a 63-year-old tenant asleep when a fire spread through his unit that lacked smoke detectors, fire alarms or a sprinkler system.

The jury’s $140 million verdict in favor of Hughes’ family was wiped out last year by the Georgia Court of Appeals, which held in part that Venetian Hills didn’t possess the apartment under state law, as Hughes did. That court said it was therefore wrong for the trial judge to have allowed the jury to consider Venetian Hills’ liability under two separate state laws: one governing landowners with possession of property and the other landlords without possession.

How the state Supreme Court decides the case in coming months will determine which liability rules govern every leased residential unit in Georgia, the Georgia and Atlanta apartment associations wrote in a brief urging the justices to uphold last year’s ruling that granted Venetian Hills a new trial.

Others have argued that the ruling last year unfairly saddles tenants with responsibility for property conditions beyond their control.

On Wednesday, the justices seemed to have a hard time accepting Venetian Hills’ argument that it had fully parted with possession of Hughes’ apartment and therefore couldn’t be held liable under the state’s landowner law.

Court records show Hughes’ lease allowed Venetian Hills’ management to enter the unit unannounced at any time “to inspect, maintain, and repair the premises or to prevent injury or damage to persons or property.”

Justice Benjamin Land said he couldn’t find a previous court decision in Georgia stating that a landlord with such a broad right of entry into a unit had fully parted with possession of it. He said the state Supreme Court would be “going out on a limb” to make that ruling.

“How is it that this landlord did not retain any right of possession when it specifically retained the right to enter the apartment, the dwelling, at any time without notice to inspect?” Land asked Venetian Hills’ attorney, Keith Blackwell. “How is that not a retention of some right of possession?”

Blackwell, a former state Supreme Court justice, responded that Venetian Hills’ right of entry did not amount to possession, though he conceded the management access in the lease agreement was “undoubtedly broad.”

“There would be no reason to have a right of entry if you hadn’t parted with possession,” Blackwell said. “The fact that the landlord has reserved a contractual right to enter the dwelling is very strong evidence that the landlord is in fact out of possession.”

Arguing for Hughes’ family, attorney Naveen Ramachandrappa disagreed. He told the justices there was evidence, in addition to the “incredibly broad right of reentry” in the lease, that Venetian Hills retained some possession of the unit and common areas. That included an obligation for management to clean certain bathrooms, he said.

Ramachandrappa said there was no evidence that Hughes or his roommates had exclusive possession and were able to prevent entry into the unit.

Justice Andrew Pinson picked up on that point, suggesting the right to exclude others is a key indicator of possession and perhaps something for a jury to decide.

In their brief, the apartment associations said if courts treated a landlord’s right to enter a leased unit as retaining possession, then “landlords would have reason to give up the inspection and maintenance rights that benefit residents.”

“A rule that discourages inspection serves no one,” the associations said.

In its own brief, Voices of Families for Justice, a national social welfare nonprofit, urged the justices to overturn the Court of Appeals ruling in the case. The organization said that decision unfairly saddles tenants with responsibility for installing, monitoring, repairing and replacing things like fire suppression and sprinkler systems.