Question: Should I be held responsible for repairs to the damaged ceiling below my unit when the BC initially accepted responsibility and delayed repairs?
A damaged ceiling in my Queensland investment unit triggered an insurance claim by the unit below. The initial repair quote was $2,000, allegedly due to membrane failure in my bathroom. The body corporate accepted responsibility but took six months to initiate repairs. When I asked about the delay, they said rectification was my responsibility. An independent inspection could not confirm membrane failure or moisture in the subfloor.
The insurer’s final cost was $4,000, significantly higher than the initial quote. The lot owner below and the body corporate accepted a cash settlement of $1,500. I received an invoice for $3,000, covering the shortfall and excess, even though the body corporate caused the majority of the delay.
Is it fair that I bear the financial burden given the body corporate’s initial acceptance of responsibility and the significant delay? Could obtaining a second quote have helped prevent this situation? Why was the repair cost exorbitant for a minor issue?
Answer: Request a formal letter of demand from the body corporate or the owner below.
There seems to be some complexities involving the body corporate’s expectations and your responsibilities under the BCCM Act. The act does require property owners to keep their properties in good condition, and it seems the body corporate is applying this to the damage caused by what was initially thought to be a membrane failure.
Given the circumstances and the financial discrepancies involved, it would be prudent to request a formal letter of demand from the body corporate or the owner below. This letter should clearly explain why they believe you are responsible for the costs. Once you have this, you could submit a claim under the Public Liability section of your landlord’s/contents insurance, which generally covers legal liabilities for property damage. If you firmly believe the responsibility for these costs does not fall to you, you have the right to contest this. You can deny the responsibility, refuse to pay the excess, and potentially take the matter to the Body Corporate and Community Management (BCCM) commissioner for dispute resolution. Here is the link for more information on the dispute process: Disputes in a body corporate.
Lastly, regarding obtaining a second quote, while it is generally a sensible idea to secure multiple quotes to ensure repair costs are reasonable, neither the lot owner nor the body corporate are specifically required to do so. This means you could still be liable for the costs incurred. I recommend asking the body corporate for an explanation regarding the shortfall in payment. It’s possible that the insurer initially agreed to cover the repairs at a certain cost, but due to delays, they may have reduced their liability to the amount it would have cost initially had the repairs been completed within a reasonable timeframe.
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.
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