On Monday, August 1, 2016, the Centers for Disease Control and Prevention (“CDC”) issued a travel warning to pregnant women to avoid the Wynwood, Midtown and Edgewater areas in Miami, Florida, due to the increasing number of people contracting the Zika virus directly from infected mosquitos within this one-square-mile region.
This recent travel advisory, along with the increased presence of Zika-infected mosquitos, will certainly impact and possibly interrupt businesses in the affected areas. Goldman Properties – a real estate firm credited with the redevelopment of Wynwood – issued a joint statement with Wynwood Business Improvement District to announce that “Wynwood’s restaurants, galleries, retailers and art-filled streets remain open for business” and the Wynwood community “will do whatever is necessary to be vigilant in our prevention and will follow the guidelines outlined by the Florida Department of Health.”
According to local news outlets, however, some businesses have temporarily closed due to the CDC advisory. For businesses that remain open, owners should review their respective property insurance policy’s provisions regarding business interruption coverage. Generally, an insurance policy does not provide coverage for a loss indirectly caused by “insects” – the classification for mosquitos. Coverage for a business loss caused by insects may be offered by commercial insurers, but it would likely result in an increased premium. With the outbreak of Zika rumored to have started earlier than initially reported, it may be too late to retroactively obtain the proper coverage for Zika-related losses already sustained. Business owners in the affected areas, and surrounding communities, should nevertheless discuss with their insurance agent the possibility of obtaining these coverages in case of future losses.
Likewise, property owners in the affected areas would benefit from reviewing their respective insurance policy’s provisions regarding liability coverage and indemnification. As more cases of Zika-related infection are reported, the likelihood that contraction of the virus occurs within the premises of a commercial property or condominium residence located in the affected areas increases. If this is the case, property owners may be held liable for a mosquito borne illness or disease contracted on their property.
This legal issue was recently addressed by the Texas Supreme Court in Union Pacific Railroad Company v. William Nami, No. 14-0901, June 24, 2016. In sum, the Texas Supreme Court ruled that an employer was not liable for a mosquito borne disease contracted by an employee even after the employee complained of a condition allowing mosquitos to enter the workspace. The court held that, under the doctrine of ferae naturae, a property owner is not liable to an invitee for harm caused by wild animals on the owner’s property.
Notwithstanding this opinion, there may be some liability if the property owner knows of an unreasonable risk and neither mitigates nor warns of the risk. Property and/or business owners in the affected areas should consider taking mitigation efforts to limit the risk to patrons and invitees from contracting the Zika virus. The CDC has recommended that air conditioning be used and any holes in screens be immediately repaired. Additionally, once a week, property owners should empty and scrub, and then turn over, cover, or throw out items that hold water such as tries, buckets, planters and trash containers. Additional suggestions include: spraying or fumigating the premises; placing citronella candles in outdoor dining or shopping areas; providing insect repellant spray and/or bracelets to patrons; and/or placing warning signs in a visible location on the property.