Question: Our tenant had to move out for the duration of common property works. Shouldn’t the OC cover any reasonable costs such as alternative accommodation for the tenant?
Bathroom repairs had to be undertaken in a tenanted one bathroom apartment due to water membrane failure. This was deemed common property.
The tenant had to move out for the duration of bathroom works. The Owners Corporation has refused requests to cover the tenant’s relocation costs.
As the bathroom repair has been deemed common property, shouldn’t the OC cover any reasonable costs such as alternative accommodation for the tenant?
Answer: We would recommend first seeking to make a claim for damage along with any loss of rent with your strata insurer and get a formal response.
In this instance, the insurer will not cover maintenance costs associated with finding and fixing the damaged membrane due to exclusions applying (such as lack of maintenance, rust, oxidation, wear & tear, corrosion, gradual deterioration, developing flaws, building defects, rectification of faulty workmanship etc.)
However, water damage resulting from the leak can be considered provided the damage is sudden and accidental. If the property becomes uninhabitable due to the insured damage, the policy can also consider loss of rent cover.
We would recommend first seeking to make a claim for damage along with any loss of rent with your strata insurer and get a formal response.
Should the insurance claim not be successful, it would fall on the lot owner demonstrating the owner’s corporation are legally liable for the loss.
If you are seeking the owners corporation to make payment for your loss because you believe they are legally responsible, to start with you will need to send a letter of demand which outlines the circumstances, why you feel the owners corporation are responsible and the amount you are seeking compensation for. Alternatively, you can visit the fair trading website for further information on resolving disputes.
This post appears in the October 2022 edition of The NSW Strata Magazine.
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.