Condo water damage: A case in point
Let’s say you own a nice condo and the toilet overflows in the unit above you overnight causing damage to your ceiling and floor – who pays?
There are a few things about water damage in condos that can muddy the waters, and there are some basics you need to know.
Your homeowner’s association, which you belong to with your fellow condo dwellers, carries a master insurance that covers threats to your building and its common areas. What that means is if water damages things such as lobbies, parking garages, elevators or other shared spaces it’s often something you won’t have to worry about.
Water damage in your individual unit is typically the responsibility of the owner. Whether or not you're covered under your personal condo insurance depends on the source of the water damage and covers the contents of the unit, any additional improvements made (such as custom flooring) and liability for accidental damage to neighbouring units.
Originates in other unit
If your water damage actually originates in another condo owner's unit, sorting out the claim isn't always easy. Consider this example, from a B.C. Civil Resolution Tribunal:
Clayton Zale and Eileen Kelly lived in a condo unit below Mark Hodgins. Overnight on Sept. 2-3, 2017, Hodgins toilet leaked, causing damage to the ceiling and floor in their unit. Hodgins reported the leak the next day. A plumber determined the toilet’s fill valve and tube needed to be replaced and it was fixed.
Zale and Kelly made an insurance claim, which the insurer paid. The policy included a $1,000 deductible, which Zale and Kelly paid and sought to recover from Hodgins in small claims court.
In April of 2018, Hodgins’ adjuster told him he could expect Zale and Kelly’s insurer to claim the cost of repairs. However, Hodgins adjuster felt he was not legally responsible for damage because he was not negligent. Zale and Kelly’s insurer abandoned the claim for reimbursement, presumably agreeing there was no negligence.
“It can be surprising and upsetting for owners to learn that they are responsible for the cost of repairs to their strata lot even though the source of the damage originated in someone else’s strata lot,” the B.C. Civil Resolution Tribunal ruled in Zale et al v. Hodgins. “However, in the absence of negligence, nuisance or a specific bylaw making owners liable for damage that originates in their strata lots, the applicants and their insurer are responsible for the cost of the damage even though they did nothing to cause it.”
No negligence claim
Zale and Kelly did not claim Hodgins was negligent. Instead, they relied instead on the condo building’s bylaws, which state an owner must not use their strata lot in a way that:
- causes a nuisance or hazard to another person.
- unreasonably interferes with the rights of other persons to use and enjoy another strata lot.
They further relied on a bulletin written by a lawyer for the Condominium Home Owners Association, which said determination of who pays for repairs is governed solely by a strata’s bylaws.
In the end, the tribunal ruled the bulletin does not refer to the responsibility of one unit owner to another when it comes to determining who pays for repair costs and disagreed Hodgins owed the claimants the deductible because he caused a nuisance or hazard.
“A nuisance occurs when a person unreasonably interferes with the use or enjoyment of another person’s property,” the tribunal found. “However, if the person is not aware of the problem that causes the interference, and has no reason to know about the problem, they will not be liable because they did not act unreasonably.”
In this case, there was no evidence that Hodgins knew or should have known the fill valve in his toilet would fail and cause a leak. Hodgins was not liable for the leak, the tribunal ruled.
The bottom line? Know what your condominium bylaws are when it comes to water damage and talk to an insurance broker about the best options for your condo owner insurance.
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