Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—MassSupJudCt: Estate May Recover for Failure to Maintain Safe Conditions at a Restaurant, (May 17, 2013)

By Jody Coultas, J.D.

The parents of a man that died after falling down the stairs at a restaurant owned by Gainsboro Restaurant, Inc. stated a Massachusetts Consumer Protection Act (CPA) claim against Gainsboro Restaurant, Inc. for failing to keep the staircase up to building code, according to the Supreme Judicial Court of Massachusetts (Klairmont v. Gainsboro Restaurant, Inc., May 16, 2013, Botsford, J.).

A jury found that the restaurant failed to comply with Massachusetts building code, but that the violations were not a substantial contributing cause of death. However, the judge concluded that unsafe conditions likely contributed to the fall and that the conditions would not have been present if the restaurant had obtained the necessary building permits

The trial court did not err in finding that the building code violations were of a duration and character to violate the CPA, according to the court. At the time of the fall, the staircase to the basement contained multiple and very serious hazards that constituted violations of the building code. Not all building code violations give rise to violations of the CPA, either because there is no unfairness or deceptiveness present or because they did not arise in trade or commerce. Here, the conduct was unfair because the restaurant consciously violated the building code for more than 20 years and created hazardous conditions in a place of public assembly where alcohol is served to commercial patrons. The conduct was also deceptive because had patrons known of the highly dangerous conditions, they would have eaten elsewhere. The conduct occurred in trade or commerce because the patron was a customer of the restaurant at the time of his fall.

The restaurant argued that the jury's findings with respect to the wrongful death claims constrained the judge's fact-finding ability in ruling on the parallel CPA claim. However, a judge may make independent findings on the CPA aspect of a case that arises from the same facts that gave rise to parallel common law claim. It was not error for the trial court to conclude that the building code violations caused the customer’s fall and resulting fatal injuries, according to the court.

CPA claims survive the death of the party on whose behalf the claim was brought, according to the court. The restaurant argued that the judge erred in awarding damages when the jury refused to impose liability under the wrongful death statute. The plaintiffs counter that wrongful death statute permits recovery for violations of the CPA that result in death so long as the CPA claim was brought using the procedures of the wrongful death statute. However, the court has made clear that an estate may bring multiple causes of action where death results from challenged conduct. Here, the alleged unfair and deceptive conduct included the construction and maintenance of a stairway that was accessible to customers and that was dangerous and did not comply with the basic provisions of the building code.

The court remanded the case to determine the amount of damages that were properly recoverable on behalf of the customer’s estate. Had the customer survived, he would only have been able to recover damages for the personal injuries caused by the unfair and deceptive conduct, including medical expenses and conscious pain and suffering. The estate may only recover what the customer would have been able to recover himself. Because the trial court awarded damages for loss of consortium and loss of future earnings, the damage award was in error.

There was insufficient evidence to overturn the trial court’s finding that the restaurant acted willfully and knowingly, and subsequently awarded compensatory damages, according to the court. The CPA allows for compensatory damages if the defendant engaged in the unfair and deceptive acts willfully and knowingly. Here, the failure to comply with the building code was obvious and willful. A reasonable person would have known the stairs posed a danger to customers and would have corrected the problem.

Although the trial court did not err in awarding attorney fees, the court remanded the case to review the amount in light of the substantial reduction in the amount of damages that may be recovered on remand.

The case is No. SJC-11154.

Attorneys: Joseph S. Sano (Prince Lobel Tye LLP) for Lisa Klairmont. Michael F. Aylward (Morrison Mahoney LLP) for Gainsboro Restaurant, Inc.

Companies: Gainsboro Restaurant, Inc.

Cases: StateUnfairTradePractices MassachusettsNews