Thank you for your patience;
a landlord is responsible for any activities that the LL knew or should have known (via the exercise of due diligence) about. So a LL can be held liable for squatters' illegal actions (versus illegal activity in general i.e. "bad neighborhood")
So basically in every lease is an implied warranty of quiet use and enjoyment-this allows the tenant to use and enjoy their home without undue disturbance from third parties. If the LL fails to maintain the premises in a safe manner, then the LL can be held liable for any damages resulting from this. Of course, such damages need to be proximately caused and reasonably foreseeable, and I believe most judges would find that burglary rates increase with the presence of squatters.
If the items had been identified and tied to the squatters then that would suffice to prove proximate cause.
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Information provided is for educational purposes only. Consultation with a personal attorney is always recommended so your particular facts may be considered. Thank you and take care.