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THIS COULDN’T HAPPEN TO ME -
PCOULD IT? By Gary Ganchrow, Parker Milliken Clark O’Hara and Samuelian
lease make sure you are sitting I do not know all the facts of the case or exactly what down when you read this... A caused the jury to hammer Owner and Management jury recently issued a $7.5 million Company. Nor do I know for sure that the jury’s verdict in favor of a resident verdict will stick, as the case still is ongoing and, manager couple (Albert and as of when I write this, the verdict will be subject Stephanie Garcia) against a to various levels of challenge. Regardless of how property owner (“Owner”) and the case turns out, however, the mere fact that a its management company jury would award such a huge verdict should serve (“Management Company”). How as a clarion call to anyone in this industry to try to is that for an attention-grabber? understand the forces that can create this type of
result.
So, technically, the entire $7.5 million verdict was
not against both Owner and Management Company I have to admit that in a perverse kind of way I find -- the jury hit Owner and Management Company the verdict gratifying because it reinforces many of collectively for $2,383,650 and then tacked on the themes I have preached in previous articles – but $4,500,000 in punitive damages against Owner and nothing brings a lesson home like someone else’s
$750,000 of punitive damages against Management Company.
How could this happen? The couple, a husband (“Husband”) and wife (“Wife”), alleged they were long-time resident managers and, while plaintiff Husband was treating for cancer, he and Wife were “advised of the termination of their employment and their lease at a critical time in their lives, removing their sources of income and displacing them from their personal home and residence.” It appears that Owner and Management Company tried to defend, in part, by claiming Husband and Wife were terminated for poor job performance.
misfortune. Here are the takeaways from the verdict that I believe to be worth pondering and discussing:
Takeaway No. 1 – $7,500,000 is a boatload of money.
Takeaway No. 2 – A property owner can insulate himself or herself from liability to a resident manager and other employees by hiring a property management company – but only if the owner genuinely turns the reigns over to the management company.
Here, the court instructed the jury that there can be multiple employers; an employer “includes any person or entity who... employs or exercises control
AMM1/6 APARTMENT MANAGEMENT MAGAZINE - DECEMBER 2021 73