Gregory Hurley
Kutak Rock
and
Jim Stiepen
General Counsel of The Irvine Company

1. Introduction To The Fastest Growing Area Of Civil Litigation

2. What Is A "Disabled Access Claim"?

3. Who Can Be Liable For Disabled Access Violations?

4. Examples Of Recent Claims For Denial Of Access

5. Avoiding Claims In New Construction & Alterations

6. Avoiding Claims In Existing Facilities

7. Shifting The Risk Of Access Claims

8. Insurance Coverage For Access Claims

9. 5 Quick Tips

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DISCLAIMER

1. Introduction To The Fastest Growing Area Of Civil Litigation

The fastest growing area of civil litigation is claims alleging violations of a disabled individual’s civil rights. In some jurisdictions suits alleging denial of access to facilities outnumber other new civil claims by a margin of two to one. Several editorials have explored "ADA claims mills" where plaintiffs and their counsel have filed hundreds of disabled access claims using form complaints.

The rise of these claims is not surprising because in many jurisdictions an individual, or class, can seek and recover attorneys’ fees, costs, and damages for merely attempting to visit a business or use the services of that business. Plaintiffs filing these claims usually do not need to show any intent by the defendants to discriminate. Moreover, they need not demonstrate that the defendants had any knowledge of the alleged violation, and generally they do not need to provide any notice prior to filing suit.

2. What Is A "Disabled Access Claim"?

Disabled access claims are claims by an individual with a disability, or one who is perceived to have a disability, and in some cases their companions as well, alleging that the individual experienced impaired or limited access to a facility or service. Although disabled access claims are often collectively referred to as "ADA claims," such claims can be based on alleged violations of a range of federal laws and regulations including: ADA Title I (employment); ADA Title II (state and local governments); ADA Title III (privately owned facilities); the Telecommunications for the Disabled Act; The Fair Housing Act; The Rehabilitation Act of 1973; The Air Carrier Access Act; The Individuals with Disabilities Education Act; and other similar statutes. In addition, these claims may arise from state laws and regulations such as California’s Civil Code Section 54 et. seq. , The Unruh Civil Rights Act, or The District of Columbia’s Annotated Code Sections 5-1701 – 1709.

Disabled access claims often involve allegations of violations of several of these laws, such as claims that an individual was denied employment because a facility was inaccessible; or claims that the living and common areas of a residential facility violate the Fair Housing Act, and the ADA. Discussion of the interrelationship of these laws and their regulations is beyond the scope of this article. For more information, you can review Gregory F. Hurley’s book Defending Disabled Access Claims.

3. Who Can Be Liable For Disabled Access Violations?

Generally, all owners and operators of a facility are responsible and potentially liable for violations of laws regulating disabled access. For example, the ADA allows a plaintiff to sue the landlord, tenant, and property managers for violations. In some cases a landlord or property manager can be liable for their tenants’ violations even if the landlord or property manager had no knowledge or control over that violation. Similarly, a tenant could potentially be liable for a landlord’s violations in constructing or maintaining a common area, or for discriminatory policies of the property manager.

Parties that "design and construct" facilities may be liable for violations at the facilities they work on. Some courts have held that plaintiffs in ADA suits can sue parties that "design OR construct" a facility, exposing project architects, interior designers, contractors, and subcontractors to potential liability.

4. Examples Of Recent Claims For Denial Of Access

Initially, many disabled access suits were claims against facilities which were obviously lacking access for individuals with mobility impairments. For example, stores with steps and without ramps or lifts were the subject of claims for denial of access. The scope of disabled access suits has been radically expanding: recent suits include claims against movie theaters alleging that the location of wheelchair seats are not appropriate; suits demanding that golf courses be wheelchair accessible; claims against internet sites alleging that they are not accessible to individuals with visual impairments; and claims that ATM’s and other pay point machines are not accessible to individuals with mobility or visual impairments. In addition, many new claims are being asserted against business alleging that their programs or services are discriminatory such as, for example, golfer Casey Martin’s suit against the PGA, as well as recent claims against amusement park operators over policies that limit access to rides.

5. Avoiding Claims In New Construction & Alterations

To avoid disabled access claims in the case of construction of new facilities or alterations to existing facilities, business owners, operators and managers must pay particular attention to state and federal disabled access regulations. While in most jurisdictions local or state building officials review construction plans and work for compliance with the accessibility requirements in state building codes, it is NOT possible to have your construction plans approved as being compliant with the requirements of the ADA. Often a building official’s interpretation of state access regulations may differ or conflict with federal requirements.

An example of this problem is a sports arena which prior to expansion went through an extensive accessibility review by the City and an independent team of disabled access experts. That facility is now being sued for violations of the ADA, and the United States Department of Justice has indicated that millions of dollars of remedial work may be needed.

The most common problem arises in alterations at existing facilities. The ADA (and many states) require that when work is done to a primary function area then not only must the new work comply with access requirements, but also the path of travel to the altered area and the restrooms, phones and drinking fountains serving that area must be made accessible. This can cause problems when a tenant undertaking construction does not control the "path of travel" to the facility.

6. Avoiding Claims In Existing Facilities

The ADA requires that even if a business undergoes NO new construction it must still remove architectural barriers where such removal can be easily accomplished without much difficulty or expense. In determining what work is "easily accomplished" courts are to examine the resources available to the parent company as well as the entity operating the business. For example, a group of plaintiffs recently demanded that a small single screen theater operating at a significant loss install a $200,000 elevator because the landlord that leased the land to the theater, and the group that managed this theater, both had substantial assets.

There is no way to obtain a determination of when the removal of a barrier is "easily accomplished. " Although not required by the ADA, businesses should consider surveys to identify architectural barriers, and to analyze the cost of removing those barriers compared against the available resources. Using this model it is possible to budget barrier removal over several years. However, businesses should only undertake these surveys if they intend to address the barriers identified and comply with the programs they develop. Some businesses have chosen to have counsel conduct or supervise these surveys to protect their confidentiality.

7. Shifting The Risk Of Access Claims

As discussed above (heading 3) landlords, tenants, property managers, architects, and contractors are all potentially liable when a facility is sued for disabled access violations. While disabled access laws generally do not allow any of these parties to avoid responsibility (or liability) by contract, the parties can allocate responsibility among themselves . This often leads to difficult and complicated contract negotiations, with one party seeking to compel another to indemnify and defend against these claims. Indemnification provisions must be carefully drafted since many disabled access claims allege intentional discrimination, and many jurisdictions refuse to enforce agreements to indemnify a party from their own intentional or discriminatory acts. While discussion of appropriate indemnification clauses is beyond this article, interested readers can review Mr. Hurley’s text, Defending Disabled Access Claims for examples.

Recently insurance carriers have begun offering polices that provide indemnity and defense from disabled access claims (see, for example, National Union’s Disabled Access Liability Insurance policy). The scope of coverage under this policy, and a more in-depth analysis of risk shifting, will be examined in the discussion "Sharing The Risk of Disabled Access Suits: Insurance Coverage & Indemnity" later this year.

8. Insurance Coverage For Access Claims

Are disabled access claims covered under your existing insurance? The answer depends on the nature of the claim, and the coverage offered in your policy. Because this is a complicated and evolving area it will have its own detailed discussion later this year. Many of these claims, or portions of these claims may be covered under existing Comprehensive General Liability insurance policies (CGL) or Employment Practices Liability Policies (EPLI). For example Mr. Hurley was recently successful in a suit against a CGL insurance carrier who denied coverage for a disabled access claim. The claimant alleged emotional distress and nausea arising from using a wheelchair space which was located "too close" to a presentation area. The Court rejected the insurer’s arguments that this claim was "expected or intended by the insured," and that the claimant suffered " no bodily injury," and found that the claim was covered under the policy.

In tendering these claims to carriers, be aware of the inherent conflicts between the insurance carrier’s interest and your interests. Most disabled access claims will include a request for injunctive relief demanding that you alter your facility or your services. Often the injunctive relief demanded is extremely expensive or impracticable. Your insurance carrier will not cover the cost of making improvements, modifying your services, or your resulting loss of revenue. In many jurisdictions this conflict between the insurer’s interest and your interest may require the insurer to provide you with independent counsel. Since the insurer may offer to defend these claims with counsel who may have little or no expertise in this area, it is often worthwhile to retain independent counsel.

9. 5 Quick Tips

1. Review your leases and contracts for appropriate provisions allocating responsibility for compliance with disabled access laws and regulations, and appropriate and enforceable indemnity agreements.

2. Be aware of your obligations under both the state and federal "path of travel" requirements when you or your tenant or landlord undertake new construction or alterations.

3. If you chose to survey your facilities and operations for accessibility make sure to implement the results of the survey. Should your survey and its suggestions be confidential or subject to the attorney- client privilege?

4. If you receive a claim, before you tender it to your insurance carriers analyze potential coverage. How your claim is presented to your carrier will often effect the insurer’s decision on coverage. Is their a "cumis" conflict? Is it appropriate for the carrier to defend you with their own counsel, or should you ask for independent counsel? Since a substantial portion of your exposure will be uninsured (your obligation to change your procedures or facilities) are you comfortable with your carrier’s tendered counsel?

5. Should you carry, or require that your tenants, landlord, property managers, contractors or others carry Disabled Access liability Insurance?

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