HOTEL LAW NEWSLETTER – JUNE 2022
Seidman Law Group represents various clients in the hotel sector. Our extensive work in this field requires us to stay current with the everchanging federal, state, and legal landscapes that affect our clients. It is our pleasure to share insight into issues we recently encountered while advising our clients.
Legislative Update: Mandatory Combustible Gas Detection
As of January 1, 2022 all hotels and motels in Maine are required to have combustible gas detectors with alarms in every room where a propane, natural gas (typically methane), or liquified petroleum gas powered appliance is used. The fine for non-compliance is “$500 for each violation”, which presumably means $500 per room per day to generate the maximum amount of revenue and deterrence. Owners may be able to avoid these fines by a Court if the owner installs the missing devices within ten days of the State issuing a complaint to the owner.
Other states and municipalities are considering similar changes by statute or administrative regulation. States we believe are most likely to adopt similar rules during the remainder of 2022 include Massachusetts, Illinois, Tennessee, and New Jersey.
Seidman Law Group recommends hotel owners and managers considering whether to procure these devices before their states or localities mandate their use. In Maine this requirement is not limited to hotels and inns; presumably, this will be the case in other states and municipalities. Residential properties– multifamily, mixed use, and college dormitories, for example–are covered.
A detailed list of all buildings covered by the Maine statute can be found at: https://www.maine.gov/dps/fmo/sites/maine.gov.dps.fmo/files/inline-files/Gasdetection.pdf
Case Update: Remember the Difference between “Shall” and “May”
A federal case in Michigan analyzing the venue provision in a guaranty securing a hotel loan did not require a lender to file its lawsuit in a particular venue. The guarantor incorrectly argued the “forum selection clause” required any lawsuit to be filed in New York state after he was sued in California.
The Court’s ruling focused on the provision in the contract that stated a lawsuit “may at lender’s option be instituted in any federal or state court in the city of New York….” The use of “may” gave the lender the option of filing suit in New York.
This case serves as a reminder to borrowers and guarantors–and their attorneys–to pay close attention to when actions are permissive or mandatory. The failure to appreciate the difference could have severe adverse consequences.
RSS WFCM2020-C55 – MI RHM, LLC v. RKJ Hotel Management, LLC, (E.D. Mich. February 28, 2022)(Report and Recommendation by Magistrate Judge Tatti)
Case Filing: Alleged Negligent Failure to Cancel Hotel Key
A twenty-one year old woman filed a lawsuit against the management and owners of a DoubleTree by Hilton alleging the front desk’s failure to cancel her lost room key resulted in her being sexually assaulted.
The facts alleged in the complaint amount to a classic failure to follow a simple standard operating procedure. In this case, the plaintiff reported losing her room key after she had been drinking with friends and other guests to celebrate her twenty-first birthday. The staff issued the woman a duplicate replacement key versus canceling the original key and issuing a new key.
One of the men drinking and celebrating with the woman’s group allegedly used the lost key card to enter her room later in the night and sexually assault her.
This case serves as a reminder to owners, management companies, and staff even the slightest mistakes can have significant safety and liability implications.
M.W. v. Aimbridge Hospitality, LLC, Case #:D-1-GN-22-002218 (Travis County, Texas)
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David Seidman is the principal and founder of Seidman Law Group, LLC. He serves as outside general counsel for companies, which requires him to consider a diverse range of corporate, dispute resolution and avoidance, contract drafting and negotiation, real estate, and other issues. He can be reached at david@seidmanlawgroup.com or 312-399-7390.
This newsletter is not legal advice. Please consult an experienced attorney to assist with your legal issues.
