This article discusses how a body corporate ceiling damage claim is assessed when further ceiling damage is reported months after roof replacement, including insurance coverage, responsibility, and whether it forms part of the original event.
Question: While we were replacing the roof, the top floor tenant reported damage to their ceiling. The damage was repaired by the BC after the roof replacement, however, months later, the tenant is claiming further damage has occurred from the same incident. Who covers the repairs?
While our Body Corporate was in process of replacing the roof, the tenant on the top floor advised their real estate that there was “small patch and cracks damage” because roofing contractors were on the roof above.
After the full roof was finished and certified, the roofing supervisor inspected the damage in the unit. They found paint peeling in a corner and on the ceiling which they advised were definitely not recent but pre-existing. There were also some minor surface cracks around the cornice and, as such, were not defective workmanship as a direct result/not covered under their warranty.
The Body Corporate arranged for a painter to quote based on those initial damages reported by tenant. This was submitted to the Body Corporate insurance and approved. Around three months after the initial report of damage, the painter completed the scope of works. The painter finished and the tenant signed off on the day. Nothing further was reported.
Two months later, the tenant submitted pictures to their real estate/Owner claiming there are a few more minor cracks and paint peeling in a new spot in lounge/halfway down wall, and a small paint bubble on a different wall/near window in the same room as initial damage. None of this damage was identified by the tenant previously nor part of the scope of works or the insurance claim.
We’ve contacted the painter and he states the new issues are not the damages shown to him as part of the scope of works he was engaged to do.
The owner claims that the new damage reported by the tenant is still Body Corporate responsibility as the damage must be due to the roof issues and subsequent replacement.
Who is responsible to fix the new damage reported by the tenant? Can the new issues be claimed against insurance as part of the original damage claim?
Answer: This will depend on whether the lot owner can demonstrate the water damage was part of the same event in the claim, or a separate event.
There appear to be a few questions to unpack here.
Can the new issues be claimed against insurance as part of the original damage claim?
This will depend on whether the lot owner can demonstrate the water damage was part of the same event in the claim, or a separate event.
The tenant would be the best person to provide guidance on this issue and if they believe it is part of the same event. My recommendation would be for the owner to re-engage the original painter to provide a quote, and if they believe the damage is part of the original (from the same water ingress event) claim, provide written advice stating this.
If the water was from a separate event, it would be a separate claim and a separate excess.
Who is now responsible to fix the new damage advised by the tenant?
A lot owner is responsible for maintaining their lot and should take responsibility for repairing the damaged ceiling.
Notwithstanding, if the body corporate is responsible for maintaining the roof (i.e. it is a shared roof) the owner may have a valid claim against the body corporate if they can demonstrate the body corporate were negligent in the maintenance of the roof or that the body corporate is otherwise legally responsible.
There is no “stock-standard” response for legal responsibility, but the owner would need to submit their reasoning as to why they believe the body corporate is responsible. Not all leaks from common property are the body corporate responsibility particularly if the leaks are unforeseen and could not have been prevented with any form of maintenance.
If it is a new claim and a new excess applies, generally it is between the body corporate and lot owner to determine who is responsible to pay the excess – for claims affecting 1 lot and common property, it is usually paid for by the body corporate unless the body corporate decides it is fair for one lot owner to bear the cost.
Given the time passed already – Is this Owner’s responsibility; or is it the Body Corporate’s responsibility?
Time does not impact who is or is not responsible. However, if the owner’s delay in reporting the incident has increased the cost of repairs, this may be considered.
Can the Owner just continue to claim any future damage?
Generally speaking, a lot owner who has contributed to insurance premiums for a policy covering property they own, can demonstrate an insurable interest in the policy. This means in instances where there is a disagreement between the owner and committee over whether a claim should or can be lodged, an insurer may give precedence to insurable interest over committee expectation.
Notwithstanding, the insurer will assess the validity of the claim based on the circumstances presented.
This post appears in Strata News #607.
Tyrone Shandiman Strata Insurance Solutions E: tshandiman@iaa.net.au P: 1300 554 165
This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisenent Australia AFSL No 240549, ABN 15 003 886 687.