"This legislation transfers liability for sidewalk accidents from the City to the property owners who already have the duty to keep the sidewalks in good repair."
Mayor Bloomberg, July 16, 2003 Public Hearing on Local law

Additionally, owners will be required to carry liability insurance to protect against potential claims (Int. No. 522). New City laws go into effect the week of September 14, 2003.

While the Mayor and proponents of these changes believe this will help save the City more than $40 million a year, property owners are facing new, increased liability risks. Previously, both New York City and property owners were liable for personal injury and property damage claims as a result of sidewalk defects. However, plaintiffs often filed notices of claim only against the City due to its "deeper pockets." These new local laws will prevent this practice by transferring liability from the City to property owners.

Substantial sidewalk defects and hazards may include cracks, trip hazards, partial repairs, improper grading, poor structural integrity, incomplete snow and ice removal, as well as damaged cellar doors. Now, instead of a snow removal fine of $50-$100, property owners could be faced with an even larger penalty - a liability claim.

With the exception of owners of one-, two- and three-family homes, property owners also are required to purchase liability insurance. Policies must cover property damage and personal injury caused by an owner's failure to maintain the sidewalk abutting the property in "reasonably safe" condition. The law does not specify the limit of liability insurance a property owner is required to maintain.

In the case of uninsured owners, the City Comptroller is authorized to pay the uncompensated medical expenses of an injured person. As a tort reform, the City now limits reimbursement to $50,000 per case for uncompensated medical expenses and caps total payments in a single fiscal year at $4 million (Int. No. 522).

The liability shift from the City to property owners equates to an estimated burden of nearly $60 million a year in judgments and claims expenditures. With the City no longer responsible for personal injury or property claims, owners may see some impact on future premiums depending on their actual loss experience and the size and nature of their other risk factors.

Previously, owners could be fined for improper sidewalk maintenance; however, new City codes do not mention fines or other punishments for non-compliance with these changed requirements. It is also unclear if the courts will support these laws when and if they are challenged.

New sidewalk liability laws will place a burden of nearly $60 million a year, in judgments and claims expenditures, on property owners.

In this changing climate, property owners should ask:

• What does "reasonably safe" or "substantial defect" really mean when it comes to sidewalk maintenance?
• Does my insurance program cover sidewalk-related injuries?
• Do I have the appropriate type of coverage, amount of insurance, and deductible amount?
• What are the financial implications of my sidewalk maintenance responsibilities?
• If neighboring properties are uninsured, do I face greater risk?

The ability to answer these questions can have a profound impact on whether property owners can respond to and address changing sidewalk liability responsibilities.

Casualty Risk Control Consulting — Focus on business protection by covering a wide range of risk issues, including hazard/property risk management, compliance audits, and property inspections.

Casualty Claims Consulting — Manage the claims recovery process through the design and implementation of post-loss management plans. Understand the historical and practical application of insurance contracts, develop claims protocol before and after an incident, assist in setting strategy regarding claim preparation, and negotiate coverage disputes.

Defining Substantial Sidewalk Defects: Excerpts from New York City Administrative Code 19-152 a: …a substantial defect shall include any of the following:

1. Where one or more sidewalk flags is missing or where the sidewalk was never built;
2. One or more sidewalk flag(s) are cracked to such an extent that one or more pieces of the flag(s) may be loosened or readily removed;
3. An undermined sidewalk flag below which there is a visible void or a loose sidewalk flag that rocks or seesaws;
4. A trip hazard, where the vertical grade differential between adjacent sidewalk flags is greater than or equal to one half inch or where a sidewalk flag contains one or more surface defects of one inch or greater in all horizontal directions and is one half inch or more in depth;
5. Improper slope, which shall mean:
   1. a flag that does not drain toward the curb and retains water,
   2. flag(s) that must be replaced to provide for adequate drainage or
   3. a cross slope exceeding established standards;
6. Hardware defects which shall mean (i) hardware or other appurtenances not flush within 1/2" of the sidewalk surface or (ii) cellar doors that deflect greater than one inch when walked on, are not skid resistant or are otherwise in a dangerous or unsafe condition
7. A defect involving structural integrity, which shall mean a flag that has a common joint, which is not an expansion joint, with a defective flag and has a crack that meets such common joint and one other joint; 8. Non-compliance with DOT specifications for sidewalk construction; and
8. Patchwork that shall mean
   1. less than full-depth repairs to all or part of the surface area of broken, cracked or chipped flag(s) or
   2. flag(s) which are partially or wholly constructed with asphalt or other unapproved non-concrete material; except that, patchwork resulting from the installation of canopy poles, meters, light poles, signs and bus stop shelters shall not be subject to the provisions of this subdivision unless the patchwork constitutes a substantial defect as set forth in paragraphs (1) through (8) of this subdivision.

a-1:…a hazard shall exist on any sidewalk where there is any of the following:

1. One or more sidewalk flags is missing or the sidewalk was never built;
2. One or more sidewalk flag(s) is cracked to such an extent that one or more pieces of the flag(s) may be loosened or readily removed;
3. An undermined sidewalk flag below which there is a visible void;
4. A loose sidewalk flag that rocks or seesaws;
5. A vertical grade differential between adjacent sidewalk flags greater than or equal to one half inch or a sidewalk flag which contains one or more surface defects of one inch or greater in all horizontal directions and is one half

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