United States: New Jersey Supreme Court Narrows The Application Of The Mode Of Operation Rule

The Mode of Operation Rule

For nearly sixty years, businesses that were self-service in nature, whereby customers could help themselves to goods, were forced to rebut the presumption that they were negligent for slip and fall accidents on self-service items.¹ However, the New Jersey Supreme Court recently limited the application of that rule—providing an important reprieve for certain businesses.

The Mode of Operation Rule (the "Rule") relieves a plaintiff from proving that a business knew or should have known of a dangerous condition, and in turn holds that the dangerous condition is foreseeable as the result of the self-service nature of the business. The foreseeable risks associated with self-service businesses—i.e. permitting customers to carry food and beverage items without lids, tops, or trays from the cafeteria counter to their tables, or allowing customers in a supermarket to pick and package their own produce—gives rise to a rebuttable inference that the business is negligent.² Thus, the business must show that it exercised due care to prevent accidents.

Recent Case Law

Recently, in Jeter v. Sam's Club, the New Jersey Supreme Court limited the Rule and held that it does not apply to the sale of grapes in closed "clamshell containers"—sealed packages.³ In Jeter, a customer sued Sam's Club after she slipped on one or more grapes "halfway past" the fruit and vegetable aisle at the Linden, New Jersey store. Sam's Club argued that the Rule did not apply because the store sold grapes only in closed, sealed packages to avoid the unsafe conditions typically caused by loose grapes. Therefore, any unsafe condition of grapes on the floor was a result of customers negligently opening the sealed packages. The customer argued that the Rule was created specifically to guard against such instances of customer negligence.

The Court considered three elements to determine if the Rule applied: (1) the self-service nature of the business, i.e., whether customers are independently handing merchandise without the assistance of employees; (2) the geographic proximity between a plaintiff's injury and a business's self-service operations; and (3) whether there is a reasonable factual nexus between the self-service activity and the dangerous condition leading to the plaintiff's injury.

The first and second elements were not at issue since Sam's Club acknowledged that it sells products in a self-service manner, and because the customer fell near the fruit and vegetable aisle. In analyzing the third element, the Court considered whether the packaging of grapes in closed "clamshell containers" made it reasonably foreseeable that grapes will drop on the floor. The

customer argued that this was a foreseeable risk, especially since Sam's Club admitted to knowing that, on occasion, its customers opened the grape containers. The Court, however, reasoned that unlike cases where customers handled grapes packaged in open-top, vented plastic bags that permit spillage⁴, customers at Sam's Club were only intended to handle the closed grape containers secured with tape. Sam's Club sold grapes in packages that posed virtually no chance of spilling during ordinary, permissible customer handling. And because Sam's Club frowned upon customers tampering with the containers by opening them, the Court found this case distinguishable from those where each business required customers to handle products in a manner that led to unsafe conditions. Because there was no clear connection between the way Sam's Club sold grapes and the customer's accident, the Court refused to apply the Rule, and the burden of proving that Sam's Club knew, or should have known, of the dangerous condition remained with the customer.

Practical Takeaways

• Since sealed containers can limit the applicability of the Rule, businesses with self-service items can reduce their risk by packaging goods in secure packages which are not intended to be opened by customers in the store.
• The mode of operation analysis includes the customer's necessary handling of goods, the employee's handling of goods, and the characteristics of the goods themselves and the way in which they are packaged. Businesses can reduce risk by limiting opportunities for their customers to handle goods.

The customer in Jeter argued that Sam's Club knew its customers opened the sealed grape containers from time to time. However, since the store frowned upon customers tampering with the containers by opening them, the Court differentiated this case from those where customers handle products leading to unsafe conditions. To limit the applicability of the Rule, businesses could provide more notice to customers advising that—for sanitary reasons—closed or sealed items are not to be opened.

Footnotes

1 Bozza v. Vornado, Inc., 42 N.J. 355 (1964).

2 Wollerman v. Grand Union Stores, Inc., 47 N.J. 426 (1966), Nisivoccia v. Glass Gardens, Inc., 175 N.J. 559 (2003).

3 Jeter v. Sam's Club, 250 N.J. 240 (2022).

4 Nisivoccia, 175 N.J. at 317-18.

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