Terry v. Lincscott Hotel Corp., 1

• Decision Date: 24 July 1980
• Docket Number: No. 1,CA-CIV,1
• Citation: 126 Ariz. 548,617 P.2d 56
• Court: Arizona Court of Appeals
• Parties: Howard TERRY and Nancy Terry, husband and wife; Jerry Ann Young, Gene Woodfin, Plaintiffs-Appellants, v. LINCSCOTT HOTEL CORPORATION; Robert H. Karatz & Naomi Karatz, his wife; Harold I. Grossman & Ryna Jean Grossman, his wife; Norman Grossman & Alene Grossman, his wife; Norman D. Levitt & Elizabeth Levitt, his wife; J. Allen Garner & Hazel Garner, his wife; Eloise D. Shapiro & Donald Shapiro; as co-partners in the Arizona General Partnership known as Scottsdale Enterprises, Defendants-Appellees. 4632.

Page 56

617 P.2d 56

126 Ariz. 548

Howard TERRY and Nancy Terry, husband and wife; Jerry Ann Young, Gene Woodfin, Plaintiffs-Appellants, v. LINCSCOTT HOTEL CORPORATION; Robert H. Karatz & Naomi Karatz, his wife; Harold I. Grossman & Ryna Jean Grossman, his wife; Norman Grossman & Alene Grossman, his wife; Norman D. Levitt & Elizabeth Levitt, his wife; J. Allen Garner & Hazel Garner, his wife; Eloise D. Shapiro & Donald Shapiro; as co-partners in the Arizona General Partnership known as Scottsdale Enterprises, Defendants-Appellees.

No. 1 CA-CIV 4632.

Court of Appeals of Arizona, Division 1, Department B.

July 24, 1980.

Rehearing Denied Sept. 3, 1980.

Review Denied Sept. 25, 1980.

Snell & Wilmer by William H. Douglas, Phoenix, for plaintiffs-appellants.

Black, Robertshaw, Frederick, Copple & Wright, P. C. by John N. Norris, Phoenix, for defendants-appellees.

OPINION

O'CONNOR, Judge.

Jewelry and other items belonging to appellants were stolen from their rooms while they were guests at the Scottsdale Hilton Inn. They brought suit for the loss against appellees, owners of the Inn. Appellees moved for partial summary judgment as to that portion of the loss which was jewelry based on A.R.S. § 33-302(A), which restricts the liability of innkeepers. The trial court granted appellees' motion for partial final summary judgment. We affirm.

The loss occurred on December 28, 1977. Some unknown thieves stole the jewelry and other items while appellants were away from their rooms. The first count of appellants' complaint simply alleges the loss, appellees' status as innkeepers, and appellants' status as guests, and seeks recovery for the loss. Count two of the complaint alleges a cause of action for negligence, as follows:

The theft of plaintiffs' personal property from their locked room is the direct and proximate result of the defendants' negligence, carelessness and recklessness in failing to provide adequate security, failing to provide plaintiffs with the degree of care and protection to which they were entitled as paying guests, and in failing to warn plaintiffs of the series of thefts and burglaries which had occurred at the Scottsdale Hilton prior to December 28, 1977.

Appellees served interrogatories on appellants asking them to state each act or omission which appellants alleged constituted negligence on appellees' part. Appellants answered as follows:

Failure to provide adequate security including the use of security guards, interior hall security personnel and adequate locking and securing devices on the doors.

Failure to increase effective security measures with full knowledge of the high incident rate of theft in the Scottsdale Hilton.

Failure to warn the plaintiffs of the number of thefts and burglaries committed in the Scottsdale Hilton prior to December 28, 1977.

A.R.S. § 33-302 reads in part as follows:

A. An innkeeper who maintains a fireproof safe and gives notice by posting in a conspicuous place in the office or in the room of each guest that money, jewelry, documents and other articles of small size and unusual value may be deposited in the safe, is not liable for loss of or injury to any such article not deposited in the safe, which is not the result of his own act.

B. An innkeeper may refuse to receive for deposit from a guest articles exceeding a total value of five hundred dollars, and unless otherwise agreed to in writing shall not be liable in an amount in excess of five hundred dollars for loss of or damage to property deposited by a guest in such safe unless the loss or damage is the result of the fault or negligence of the innkeeper.

C. The innkeeper shall not be liable for loss of or damage to merchandise samples or merchandise for sale displayed by a guest unless the guest gives prior written notice to the innkeeper of having and displaying the merchandise or merchandise samples, and the innkeeper acknowledges receipt of such notice, but in no event shall liability for such loss or damage exceed five hundred dollars unless it results from the fault or negligence of the innkeeper. (emphasis added)

The notice placed in appellants' rooms reads as follows in large size print:

PLEASE

Safety Deposit Boxes for your valuables are available at the Reception Desk. We recommend that you deposit all valuables.

We also suggest you double bolt your door when using the patio door to the swimming pool.

Arizona Statutes do not hold hotels liable for missing valuables, nor do we have insurance coverage.

So ...

please deposit your valuables.

There is no dispute that the hotel maintained a fireproof safe as required by A.R.S. § 33-302(A).

On appeal, appellants argue that partial summary judgment for appellees was improper for two reasons. First, they argue that A.R.S. § 33-302(A) was intended to relieve an innkeeper of his common law strict liability for the guest's property, but not from the effects of his own negligence. Second, appellants contend that the trial court erred in holding as a matter of law that the notice placed in appellants' rooms complied with the statute.

INNKEEPER LIABILITY

The common law rule imposed a strict rule of liability upon an innkeeper and was founded upon the public policy of an earlier day. We quote from the case of Minneapolis Fire & Marine Insurance Co. v. Matson Navigation Co., 44 Hawaii 59, 61, 352 P.2d 335, 337 (1960):

The imposition of strict liability on the innkeeper found its origin in the conditions existing in England in the fourteenth and fifteenth centuries. Inadequate means of travel, the sparsely settled country and the constant exposure to robbers left the traveler with the inn practically his only hope for protection. Innkeepers themselves, and their servants, were often as dishonest as the highwaymen roaming the countryside and were not beyond joining forces with the outlaws to relieve travelers and guests, by connivance or force, of their valuables and goods. Under such conditions it was purely a matter of necessity and policy for the law to require the innkeeper to exert his utmost efforts to protect his guests' property and to assure results by imposing legal liability for loss without regard to fault.

Statutes such as A.R.S. § 33-302 were enacted as law enforcement improved and travel was less hazardous. The need to limit an innkeeper's potential liability became apparent. As is stated in an annotation at 37 A.L.R.3d 1276, 1279-80 (1971):

The statutes defining the limits of an innkeeper's liability for loss of or injury to his guest's property represent a legislative intent to soften what has been termed an unduly harsh common-law rule.

In former times, there were a number of sound reasons to justify the public policy of imposing a strict rule of liability on innkeepers. And so, at common law, the innkeeper was practically an insurer of property brought by a guest to his inn and he was relieved of liability for the loss of such property only where the loss occurred through an act of God, through an act of a public enemy, or through the fault of the guest himself.

Since the passing of years has erased much of the need for such absolute liability, the modern innkeeper is often permitted by statute to lessen his responsibility to certain limits, if he provides suitable locks on his guests' rooms, provides a safe for the protection of their valuables, and provides adequate notice of the presence of that safe and, in some cases, of his limited liability. (footnotes omitted)

A.R.S. § 33-302(A) provides that an innkeeper who maintains a fireproof safe and posts the required notice is not liable for loss of jewelry or articles of unusual value "which is not the result of his own act." Subsection B provides that the innkeeper is not liable for more than $500.00 for the loss of jewelry or valuable items placed in the innkeeper's fireproof safe unless otherwise agreed to in writing, or unless the loss is "the result of the fault or negligence of the innkeeper." Subsection C has a separate provision limiting liability of the innkeeper for loss or damage to merchandise samples unless it "results from the fault or negligence of the innkeeper."

Appellant argues that the phrase in subsection A, "which is not the result of his own act," preserves a cause of action against the innkeeper for his negligent inaction in failing to provide adequate security and in failing to warn appellant of the number of thefts within the hotel.

There are cases from some jurisdictions holding that innkeeper's liability statutes were intended to relieve only the innkeeper's liability as an insurer, but not to preclude recovery for loss caused by the innkeeper's negligence. See, e. g., Shiman Bros. & Co. v. Nebraska Nat. Hotel Co., 143 Neb. 404, 9 N.W.2d 807 (1943); Hoffman v. Louis D. Miller & Co., 83 R.I. 284, 115 A.2d 689 (1955); Shifflette v. Lilly, 130 W.Va. 297, 43 S.E.2d 289 (1947). Other jurisdictions have interpreted the provisions of particular statutes as limiting the amount of recovery for loss of a guest's property even when caused by the innkeeper's negligence. See, e. g., Ricketts v. Morehead Co., 122 Cal.App.2d 948, 265 P.2d 963 (1954); Pfennig v. Roosevelt Hotel, 31 So.2d 31 (La.1947); Levesque v. Columbia Hotel, 141 Me. 393, 44 A.2d 728 (1945); Goodwin v. Georgian Hotel Co., 197 Wash. 173, 84 P.2d 681 (1938).

We are guided in our analysis of the statute in question by the customary principles of statutory construction. Statutes are not to be construed as effecting any change in the common law beyond that which is clearly indicated. Farnsworth v. Hubbard, 78 Ariz. 160, 277 P.2d 252 (1954); Kilmer v. Hicks, 22 Ariz.App. 552, 529 P.2d 706 (1974). Where a statute is in derogation of the common law, and is also remedial in nature, the remedial application should be construed so as to give effect to its purpose. This concept is expressed by the New Mexico Supreme Court in a case interpreting the innkeeper's liability statutes in that state, as...