THE MAGAZINE

Who's Liable Now?

By Edward Solensky, Jr.

Consider the following scenario: A company has been contracted to provide guard services at a major sports stadium. A season ticket holder, Mr. Smith, attends the season’s opening game accompanied by his wife and two children. Seated two rows behind Smith are several intoxicated fans who begin shouting obscenities. At one point, Smith asks them to stop cursing. The parties exchange insults followed by yelling and pushing. The confrontation escalates into a full-blown physical assault on Smith, who is knocked down and injured. Smith files a lawsuit against the stadium, claiming that it was negligent in control of the rowdy crowd. He also names the guard company as a defendant under several legal theories, including that he was owed a duty as a third-party beneficiary of the security service agreement.

Guard companies face potential liability in numerous other circumstances as well. For example, officers may assume duties or make decisions that go beyond the contract, and which may prove to be wrong. But there are many cases in which guard companies are not legally liable. It helps to understand where the courts have drawn the lines.

The Theories
Personal injury lawsuits filed against security guard firms by third parties may be brought on various legal theories. One that is frequently used is called the intentional tort theory; it requires that the plaintiff prove the elements appropriate to the tort—that he or she was assaulted, for example—and demonstrate that the guard’s wrongdoing occurred within the scope of his or her employment.

A second basis for claims is called a negligence action; under that legal theory, the plaintiff must prove that the company employed by the defendant had a duty to provide guard services that would protect the plaintiff; a security guard employed by the defendant breached that duty; the guard’s breach was the cause of an injury or loss sustained by the plaintiff; and liability for the guard’s wrongdoing is the responsibility of the defendant. Also, it may be possible to establish a security company’s direct liability for negligence in hiring, training, assigning, or supervising a security guard.

A newer basis for claims is that the plaintiff was owed a duty as a third-party beneficiary of the security services agreement. This theory rests on the wording and scope of the contract agreed to by the guard firm and its client.

A plaintiff can establish rights as a third-party beneficiary of a security services contract through post orders: the written orders that are set out in the contract to direct the security officers’ actions while they are on duty. Post orders usually include set time requirements for patrols as well as instructions regarding how officers are to assist in monitoring access control and keeping unauthorized people off the property to reduce the risk of theft, vandalism, and assault.

Post orders are a component of standard security practices. Without post orders, security officers are placed in the position of assuming duties or making decisions beyond their authority. Poorly drafted post orders also run the risk of exposing a guard company to litigation.

To illustrate the difference a poorly constructed phrase can make, following are two different cases in which a security guard company was sued and how the contract protected the company in one case and opened it up to liability in the other.

Parking Peril
In Berg v. Allied Security, Inc. (Illinois Court of Appeals, 1999), plaintiff Joan Berg sued Podolsky & Associates, Inc., and Allied Security, Inc., after she was attacked by an unknown assailant in an office complex parking lot.

Berg was returning to work after having picked up pizzas for her coworkers on the 2 p.m. to 12 a.m. shift. As Berg stepped out of her car, she was hit in the back of the head. When she turned, she saw a man standing over her with a solid metal bar. He pushed her into the car across the front seat, continuing to strike her repeatedly. Berg struggled to the steering wheel and sounded the horn. The attacker fled.

During the previous six years, there had been no violent attacks in the parking lot, but there had been approximately 20 incidents of property damage to automobiles parked there.

Berg’s office was located in one of the buildings in the office complex, which was owned by Podolsky. Podolsky had hired Allied to provide security at the site 24 hours a day.

The contract provided for guards to monitor the company’s CCTV system, among other duties. Podolsky had 20 CCTV cameras located throughout the office complex; they were connected to four monitors. The guard at the security desk controlled which camera views appeared on these four monitors in front of him. However, due to the additional responsibilities of the position, the guard could devote no more than about half of his time to viewing the monitors.

One of the cameras could have been used to scan the area of the parking lot where Berg’s car was parked, and when in the scan mode, it would have covered the area every few seconds. At the time of the attack, the camera was not in scan mode.

The contract between Podolsky and Allied said that Allied would provide security personnel to perform mutually agreed-on tasks. The contract also stipulated that Allied would provide security personnel whose principal posts and hours of duty would be mutually agreed on by Podolsky and Allied.

If Podolsky changed the time or the amount of coverage originally requested, significantly altered the duties of the Allied personnel, or changed the nature of the client’s environment substantially, Allied reserved the right to renegotiate the contract. The contract required that Allied be in compliance with all relevant statutes, rules, regulations, ordinances, and other regulatory procedures at all times and provide personnel to perform such services as might be agreed on.

Allied agreed to perform tasks that were reasonably requested by the client and consistent with post duties; however, the guards remained the employees of Allied. Under the terms of the contract, hiring, training, uniforming, equipping, supervising, directing, and discharging of all security guards was the sole function and responsibility of Allied.

The post orders issued by Allied provided that the primary functions of the guards would be to: keep unauthorized people from the property and reduce the risk of theft, vandalism, and assault; assist in access control for authorized visitors and employees; and reduce the threat of damage to property due to fire, equipment failure, flooding, and other factors.

Under the post orders, guards were instructed to accomplish these functions by: maintaining a high level of visibility; properly dealing with situations that arose such as unauthorized visitors, unsecured building doors, and equipment failures; ensuring constant vigilance and effective reporting of events, such as loiterers and fire hazards; and seeking assistance as needed in specified situations.

Berg alleged that Allied had voluntarily assumed a duty to protect her. According to Berg, the scope of the duties set out specifically in the contract included the duty to maintain a high level of visibility, the duty of constant vigilance, and the duty to keep unauthorized people from the property to reduce the risk of assault.

Allied disagreed that it owed a contractual duty to protect Berg from the danger of unforeseen criminal acts of third parties. Allied argued that its duty was limited to the terms of the contract, which did not include the protection of tenants in the parking lot, particularly since it had no authority to control access to the parking lot and, in the event of such attack, had no authority to intervene. Allied noted that although there was a history of crime in the parking lot, there were no incidents of prior violent crimes. Therefore, Allied contended, the attack on Berg was not reasonably foreseeable and it had no duty to prevent it.

Berg acknowledged that the attack was the first of its kind suffered at the office complex, but under her claim, the issue of whether the risk was foreseeable was deemed irrelevant, since Podolsky obviously felt strongly enough about a possible risk to implement security measures for the protection of his tenants.

Finding. The court found that the foreseeability analysis was unnecessary because both Allied and Podolsky expressly undertook a duty to reduce the risk of assault by the terms of their contractual agreement. The court noted that, while the issue of foreseeability may or may not be relevant to a determination of whether either defendant breached its duty, the existence and scope of the duty were determined by the contract.

The court reasoned that the facts indicated that both Allied and Podolsky knew of the present risk, because the security measures that were implemented specifically included reducing the risk from assault. Thus, according to the court, as evidenced by the terms of their contract, the extent of their voluntary undertaking included protecting the plaintiff from an assault.

Performing patrols of the parking lot was one of the activities contractually agreed on by the defendants. The court further found that this was an even stronger indication of its duty to Berg in that the post orders specifically stated that the security guard’s role was to reduce the risk of assault. The fact that Allied’s personnel were not police and could not control access to the parking lot did not negate the existence of this duty.

Although actions for failure to provide adequate security can be brought both against a client and a security company hired by the client, each action will have an entirely different basis. Generally, the liability of the property owner or occupier must be established by showing that he or she failed to arrange for adequate guard services or other security measures commensurate with the danger of crime or other hazard presented. The liability of a security company, on the other hand, must be established by showing that its personnel failed to exercise reasonable care in carrying out the particular duties they were explicitly assigned.

In terms of the guard company’s contract or post orders to provide security, individual services will be important. In many cases, the contract or post orders may be the principal evidence in determining whether a security provider had a duty to the plaintiff, or whether its duty extended to protect against the particular hazard that is the basis of the third-party beneficiary plaintiff’s claim.

The security company’s liability for the negligence of a security guard can usually be established only by showing that the guard failed to exercise reasonable care in performing the particular services the guard was employed to perform. Therefore, if the contract and post orders speak in generalities such as “protection against property damage” or “preventing assaults,” it will be easier for a third-party beneficiary plaintiff to argue that some duty was owed the plaintiff by the guard company.

Where the guard’s duties are spelled out with specificity—and the guard exercises reasonable care in providing the particular services the contract requires of the officers—the guard company will have no duty to provide services the contract does not require.

In Berg v. Allied Security Inc., the broad language of the post orders turned Allied into an insurer of events rather than a security contractor.

Mall Mayhem
In Wise v. Burns International Security Services Corporation (Washington Appeals Court, 2003), the court found that, in light of the language of specific post orders, a teenager was not a third-party beneficiary under a security services agreement.

In this case, 19-year-old Christopher Wise and his friends were at Sea-Tac Mall. There they encountered three teenagers, Anthony Scott, Kenneth Mace, and James Parker; the two groups decided to leave together. In the parking lot, Wise and Scott began to fight. Scott punched Wise in the face twice, then walked away with Mace. Shortly thereafter, Scott and Mace walked back to Wise, ripped off his shirt, threw him to the ground, kicked him several times, and stomped on his head.

Jeffrey Van Valkenberg, a mall security guard, saw the fight but did nothing to intervene. Van Valkenberg worked for Burns International Security Services Corporation (Burns), with whom Sea-Tac Mall had contracted for security. Eventually another security guard arrived and the crowd dispersed. Wise sustained serious injuries.

Wise and his parents filed a lawsuit for negligence, negligent supervision, and assault and battery against several parties, including Burns. Wise argued that Van Valkenberg was present during most of the altercation and did nothing to stop it.

Burns moved for summary judgment—a hearing based on the facts of a case without a trial—arguing that Wise could not establish duty, breach, or proximate cause. At the trial level, the court granted Burns’ motion for summary judgment on the issues of duty and breach but declined to grant summary judgment on the proximate cause issue. Wise appealed.

On appeal, the court found that there was no evidence that Burns assumed responsibility for the safety of Sea-Tac Mall visitors. According to the court, the contract between Burns and the mall specifically stated that the services to be provided were solely for the benefit of the mall, and any services rendered did not confer rights on any other party.

The court further noted that the contract did not specifically define which services Burns was to perform, but it limited the scope of services to those established by personnel assignments, patrol inspections, and post orders.

The issue is not whether the post orders are written into the contract, because most courts would view the post orders as part of the contract or, alternatively, as evidence of the guard company’s obligations in performance of its contract.

In Wise, the court addressed the case in a two-step process. The contract was the starting point for the court in analyzing whether the plaintiff was a third-party beneficiary to the agreement between Burns and the mall. According to the court, the contract between Burns and the mall specifically stated that the services to be provided were solely for the benefit of the mall, and any services rendered did not confer rights on any other party.

The court then looked to the post orders for further support for this reading of the contract. Looking at the post orders, the court found that Burns did not explicitly promise to protect mall visitors. According to the court, the promise to “assist visitors and serve as concerned public relations representatives” did not even imply that Burns intended to protect customers from criminal harm.

Burns only promised to protect mall personnel, and the only mention of criminal harm is in the context of deterrence. The agreement between Burns and Sea-Tac Mall did not indicate that Burns assumed responsibility for, or was entrusted with, visitors’ safety.

Burns’ post order for Sea-Tac Mall promised that guards would “be receptive to the mall’s needs, observantly survey the mall’s premises, and use their professional presence to deter unlawful or undesired acts, and to report security activities in a timely manner.”

In the post orders Burns further promised that guards would: assist visitors and serve as concerned public relations representatives; protect personnel on the premises; serve as a deterrent to persons intent on committing criminal acts including vandalism; protect proprietary and classified information; look for and report potential hazards; restrict access to authorized people; watch for the use of illegal drugs and the consumption of alcohol; and monitor materials leaving the facility, helping ensure that company property does not leave without proper authorization.

Wise argued that the contract promised customer protection when it provided that “force shall never be used to detain anyone suspected of committing a crime or causing a disturbance on mall property, unless the person poses physical danger to himself, other customers, or to the security officer.”

The court found, however, that this oblique reference to customers did not by itself change the meaning of the contract, particularly since the contract clearly stated that it was solely for the benefit of the client and conferred no rights to any other party. Therefore, ruled the court, summary judgment on the existence of duty was proper.

Compliance Standards
Post orders should be carefully drafted, detailed, and always in writing. A guard company should set up strict patrol compliance standards as part of its written contracts. This can help to ensure that guards are not going beyond post orders and creating a duty that wasn’t intended.

Security officers should also be instructed to refrain from assuming duties or making decisions beyond the post orders. Adopting these measures can go a long way toward ensuring contract fulfillment while avoiding the creation of a perception of liability for responsibilities the contract was never intended to establish.

SYNOPSIS
Guard companies are at risk of being exposed to potential liability when they undertake a new security services contract. Security officers may assume duties or make decisions that go beyond the contract and which may prove to be wrong. However, poorly drafted contracts and post orders can also expose a guard company to litigation, should a security-related premises liability event occur at a client site.

Personal injury lawsuits filed against security guard firms by third parties may be brought on various legal theories. A newer basis for claims is that the plaintiff was owed a duty as a third-party beneficiary of the security services agreement. This theory rests on the wording and scope of the contract agreed to by the guard firm and its client.

A plaintiff can establish rights as a third-party beneficiary of a security services contract through post orders, depending on their wording: the written orders that are set out in the contract to direct the security officers’ actions while they are on duty. Without post orders, however, security officers are placed in the position of assuming duties or making decisions beyond their authority. Specific post orders can reduce the risk of guard company liability.

In one case, the court found that in light of the language of specific post orders, a teenager who was assaulted at a shopping mall was not a third-party beneficiary under a security services agreement.

The court found that there was no evidence that the contract security company assumed responsibility for the safety of mall visitors. According to the court, the contract between Burns and the mall specifically stated that the services to be provided were solely for the benefit of the mall.

Edward Solensky, Jr., is former corporate security counsel for Burns International Security Services. He currently practices law in Newark, New Jersey, at the law offices of Floyd G. Cottrell, where he specializes in premises liability and security cases.

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