\tOn September 1, 2021, the remnants of Hurricane Ida struck New Jersey. Heavy rain and flooding ensued throughout the area, with many homes and businesses suffering significant damage as a result. Tenants of rental properties were particularly affected, as many were unaware their leased premises were located in a flood zone. Many commercial tenants suffered flood damage to their equipment, inventory, and other assets and incurred loss of business revenue but carried no flood insurance because they were unaware of its availability. This unfortunate circumstance raises questions about a commercial landlord\u2019s obligation to inform its tenants about the flood zone status of their leased premises and its potential liability for failing to do so.<\/p>\n
\tMany commercial landlords are unaware that New Jersey\u2019s Truth in Renting Act (\u201cTRA\u201d), which is more commonly associated with residential tenancies, specifically addresses a commercial landlord\u2019s obligation to advise tenants of the flood zone status of their leased premises. While the term \u201clandlord\u201d in the TRA is generally defined as one who leases \u201cdwelling units,\u201d see N.J.S.A 46:8-44(a), the \u201cTenant Notification of Flood Zone Location\u201d provision, which requires landlords to notify tenants when a property is located in a flood area, expressly references lessors of commercial space. N.J.S.A. 46:8-50. <\/p>\n
\tMany commercial landlords believe that the requirements under the TRA apply solely to residential leases. Yet, legislative history suggests the drafters of the TRA considered the damage caused by storms such as Hurricane Ida when determining flood zone notice requirements. The New Jersey Senate\u2019s Community and Urban Affairs Committee reported favorably on the bill for the Truth in Rending Act, stating that \u201cduring the heavy flooding which occurred during the fall of 1999, many tenants discovered that the apartments or businesses<\/strong> which they rented were located in flood zones.\u201d Notice to tenants was important because \u201chad they been apprised of this information earlier, these tenants may have determined to purchase flood insurance, or to rent elsewhere.\u201d Therefore, the plain language of N.J.S.A. 46:8-50 makes it clear that the flood zone notice provision of the TRA applies to commercial spaces, notwithstanding that the rest of the Act is limited to residential leased premises.<\/p>\n