Question: If our building requires hot water pipe maintenance that results in no hot water for some time, is the body corporate responsible for resident’s temporary accommodation?
Our building may require significant and urgent hot water pipe maintenance, resulting in no hot water access for a period of time. Is the body corporate required to pay for resident’s temporary accommodation during the work? In QLD, the rental minimum standards to be considered habitable require hot running water.
Answer: All owners may be in the same position, so they would be funding their own loss and damage via the body corporate.
Todd Garsden, Mahoneys:
A body corporate’s strict maintenance obligation means that any time an element falls out of good condition, the obligation is breached. Breach of a statutory obligation can give rise to liability if an owner or occupier suffers loss.
Accordingly, there is not necessarily an entitlement to “alternative accommodation”, but if there is quantifiable loss, the owner or occupier may be able to recover that from the body corporate.
In some circumstances this is academic, as all owners may be in the same position so they would be funding their own loss and damage via the body corporate. The quantum of loss also regularly pales in comparison to the cost burden of evidence and proceedings to make any such claim against the body corporate.
Tyrone Shandiman, Strata Insurance Solutions:
From an insurance perspective, claims for loss of rent or accommodation costs are generally only considered where insured damage renders the property uninhabitable. In this instance, the issue appears to relate to piping works. It’s unclear whether the cause is due to insured damage or a non-insurable matter such as defects, wear and tear, gradual deterioration, or general maintenance. If the latter applies, insurance is unlikely to respond to either the event or any resulting loss of rent.
If a legal claim is made against the body corporate—for example, alleging a breach of statutory duty—there may be scope for cover under the legal defence costs section of the policy subject to the terms, conditions, and exclusions.
Todd Garsden
Mahoneys
E: tgarsden@mahoneys.com.au
P: 07 3007 3753
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.
This post appears in Strata News #745.
Question, when a body corporate is authorizing remedial works and maintenance and requires additional funds from owners due to not enough funds in the sinking fund. Is the amount required divided equally between the number of units OR should the amount be divided by the size of the units [1 bedroom and 2 bedroom etc]?
Hi,
The total should be divided by the unit entitlements ascribed to each lot. Effectively this is the second method you are suggesting. You can check the entitlements on your CMS and if you have any questions on the split you should check with your body corporate manager.