By Chuck Geerhart
The Oakland “Ghost Ship” warehouse fire was a tragedy. Thirty six people died. There were also serious burn and smoke inhalation injuries. There were undeniably many fire and health and safety code violations in this building. The master tenant appears to be a ne’er do well with limited assets. To whom can the families of the deceased and the injured people look to for compensation?
There may well not be enough insurance and other assets to fairly settle all claims. But surely the responsible parties should not escape without paying whatever they can.
Here are the possible responsible parties: 1) Chor Ng, the owner of the property and many other Bay Area properties; 2) Derick Ion Almena, the master tenant; 3) 100% Silk, the concert promoter, and 4) anyone else involved in staging the event. Unfortunately, the ultimate “deep pocket,” the City of Oakland, is immune from suit for failing to perform proper building inspections under Government Code 818.6. (http://law.onecle.com/california/government/818.6.html)
This “inspection immunity” was upheld by the California Supreme Court in Haggis v. County of Los Angeles (2000) 22 C4th 490. http://caselaw.findlaw.com/ca-supreme-court/1403135.html
Almena by all accounts has no major assets. He might have carried insurance, but his lifestyle suggests otherwise. Even if he did carry insurance, it probably had low policy limits, i.e., under $1 million.
The concert promoter may have had a commercial policy. The typical promoter’s policy is $1 million, which is a drop in the bucket in a multi-death case which is worth $100 million or more at trial.
This leaves Ms. Ng. She undoubtedly carried insurance– the question is how much? Were there umbrella or other excess policies? She also owns a lot of property. A large judgment of $100 million or more against her would likely force her into bankruptcy, but she would still have to liquidate her assets and pay as much as she could to the families of the dead and injured. That is almost certainly what will happen eventually after she has stopped shamelessly denying liability.
You may wonder, with 36 wrongful death claims, how does any one family ensure it receives compensation? The answer is that Ms. Ng and her insurance carriers will try to settle all the claims together, so she can “buy her peace” and not have to worry about later lawsuits. So everyone should have a seat at the table.
You may have heard that Ms. Ng denies knowing anything about the unsafe conditions at the Ghost Ship. Her position has been refuted by those who know. But even if she never set foot in the building while it became unsafe, her family members or other agents were there. Their knowledge is “imputed” back to her. Also, as a commercial landlord, she has a duty to inspect her buildings periodically and upon lease renewal. (Mora v. Baker Commodities, Inc. (1989) 210 Cal.App.3d 771) (https://scholar.google.com/scholar_case?case=16407163262178681036&hl=en&as_sdt=6&as_vis=1&oi=scholarr)
California Civil Jury Instruction 1006 states the law:
1006. Landlord’s Duty
A landlord must conduct reasonable periodic inspections of rental property whenever the landlord has the legal right of possession. Before giving possession of leased property to a tenant [or on renewal of a lease] [or after retaking possession from a tenant], a landlord must conduct a reasonable inspection of the property for unsafe conditions and must take reasonable precautions to prevent injury due to the conditions that were or reasonably should have been discovered in the process. The inspection must include common areas under the landlord’s control.
After a tenant has taken possession, a landlord must take reasonable precautions to prevent injury due to any unsafe condition in an area of the premises under the landlord’s control if the landlord knows or reasonably should have known about it.[After a tenant has taken possession, a landlord must take reasonable precautions to prevent injury due to any unsafe condition in an area of the premises under the tenant’s control if the landlord has actual knowledge of the condition and the right and ability to correct it.]
Among the leading cases in this area is Portillo v. Aiassa (1994) 27 Cal.App.4th 1128, which held: “[T]he landowner’s lack of knowledge of the dangerous condition is not a defense. He has an affirmative duty to exercise ordinary care to keep the premises in a reasonably safe condition, and therefore must inspect them or take other proper means to ascertain their condition. And if, by the exercise of reasonable care, he would have discovered the dangerous condition, he is liable.”
Under the doctrine of nondelegable duty, a landlord cannot escape liability for failure to maintain property in a safe condition by delegating the duty to an independent contractor or to a tenant. (Srithong v. Total Investment Co. (1994) 23 Cal.App.4th 721.
In conclusion, if you or a loved one was injured or killed in this tragic fire, there is the potential to hold the owner of the building and others financially accountable. It will not be easy, but the guilty should not escape justice.