Who pays in­sur­ance de­ductible?

Penticton Herald - - HOME & GARDEN - TONY GIOVENTU

Dear Tony: Our high-rise build­ing has had a num­ber of wa­ters leaks over the past year re­lat­ing to toi­lets, show­ers, shower en­clo­sures and fridge wa­ter lines.

Our strata coun­cil have is­sued no­tice to own­ers that a plumber will be on site in two weeks to in­spect our strata lots and will be mak­ing rec­om­men­da­tions that for main­te­nance to strata lots to en­sure we don’t have any fu­ture prob­lems.

As a re­sult of the leaks our in­sur­ance de­ductible has in­creased to $50,000 and sev­eral own­ers are dis­put­ing the strata claims to pay the in­sur­ance de­ductible. We have a by­law that re­quires an owner to pay for the de­ductible if they have been neg­li­gent or contributed in any way to the claim.

I am con­cerned about our by­law after the plumb­ing in­spec­tions. Will the strata be able to hold us to a higher level of li­a­bil­ity be­cause of the re­port? — Kyle D. Burn­aby

Dear Kyle: The Strata Prop­erty Act sets a rea­son­able con­di­tion of li­a­bil­ity as re­spon­si­bil­ity. If the owner is re­spon­si­ble for the claim, the strata cor­po­ra­tion may com­mence a claim in the courts, arbitration or through the Civil Res­o­lu­tion Tri­bunal to ob­tain a de­ci­sion for the amount of the claim.

The term “re­spon­si­bil­ity” has been in­ter­preted by the courts as a ba­sic test of those con­di­tions within the strata lot that are the obli­ga­tion of the strata lot owner to main­tain, re­pair or within their di­rect con­trol.

If my dish­washer fails and the pump causes a flood, or my shower en­clo­sure is not main­tained caus­ing a leak into other units, or I plugged my toi­let and ne­glected to re­spond and left the unit while it was run­ning, or my newly in­stalled fridge with wa­ter lines and an ice maker fails and floods, you can rely on the gen­eral rule of thumb that I am re­spon­si­ble and the strata has a rea­son­able like­li­hood of re­cov­er­ing de­ductible cost.

The real com­pli­ca­tion arises when a strata cor­po­ra­tion adopts a stan­dard of neg­li­gence. If your strata has adopted this by­law it will re­quire the strata cor­po­ra­tion prove the owner was neg­li­gent, not sim­ply re­spon­si­ble.

While the in­spec­tions may iden­tify risks or de­fi­cien­cies, what hap­pens to those risks that are not iden­ti­fied? Neg­li­gence is a much higher test that im­poses a much higher stan­dard of fail­ure or ac­tion by the owner.

Your email is per­fect tim­ing as a de­ci­sion from the Civil Res­o­lu­tion Tri­bunal posted last week goes di­rectly to the is­sue of neg­li­gence.

In the de­ci­sion the Own­ers, Strata Plan BCS 1589 v. Nacht et al, 2017 BCCRT 88, the ad­ju­di­ca­tor found as a re­sult of the strata by­laws, that “proof of neg­li­gence on the part of the own­ers is re­quired for the strata to re­cover its in­sur­ance de­ductible from the own­ers”.

If an owner does not act with a rea­son­able stan­dard of care for the main­te­nance and re­pair of their strata lot and the com­po­nents within their strata lot, the stan­dard set by the Act is more than suf­fi­cient for the strata cor­po­ra­tion to re­cover a de­ductible.

A by­law that im­poses a higher stan­dard will only re­sult in all of the own­ers in­cur­ring the cost of the de­ductible amount for claims.

Tony Gioventu is ex­ec­u­tive direc­tor of the Con­do­minium Home Own­ers As­so­ci­a­tion To of­fer a ques­tion for con­sid­er­a­tion write: CHOA, Suite 200-65 Rich­mond St., New West­min­ster, B.C., V3L 595 or email: tony@choa.bc.ca.

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