What A Homeowner Should Do And Consider When Water Gets Into Their Condo
The issues that a condominium owner faces when water enters their home can be more challenging than when that same problem happens in a detached single-family home. These include the following:
· What is the source and cause of the water intrusion?
· Who owns the property/space that is the source of the water intrusion?
· Who is responsible for maintaining that property/space?
· What rules and/or procedures need to be followed in order to resolve the problem?
· Where will the money needed to pay for that resolution come from?
The following are some things to do and consider when addressing these issues.
The first step to take is an obvious one: stop the water intrusion and the spread of any damage to the condo. These are often two different issues. The first involves identifying the source of the leak and its cause and at least temporarily repairing it. The second involves identifying and minimizing the damage that has occurred to the unit.
The challenge in taking this first step is to coordinate it in a way that protects the homeowner’s interests but puts all potential parties and their insurance companies on notice of the problem and preserves the evidence that may be important in the event that there are disputes over the source and cause of the water intrusion and the nature and extent of any damage.
Most homeowners start this process by contacting a plumber, general contractor, or a company specializing in leak detection and mitigating the consequences of water intrusion. Where there is potential for a mold problem, the services of a qualified environmental engineer may also be needed.
Whoever the homeowner retains to temporarily repair the water intrusion is likely to be the primary person the homeowner will rely on in the event there is a dispute over who is responsible for that water intrusion. Retaining a qualified professional (engineer, and/or contractor) to evaluate the source and cause of the water intrusion is important in the event such a dispute arises. There are qualified professionals experienced in not only evaluating conditions that are present but also documenting and preserving those conditions (via photographs, videos, moisture readings, retaining all physical evidence, etc.). If the homeowner cannot retain such a qualified professional at the outset, they should make sure that the plumber, contractor, and/or leak detection company they retain is aware of the importance of photographing, documenting, and preserving the evidence. The homeowner should keep in mind that this individual may need to be a spokesperson on their behalf in any dispute. Their knowledge, training, skill, and experience handling these types of problems and their ability to express their opinions may impact the outcome of any dispute.
The individual the homeowner retains should also have an understanding of the issues that determine who is the owner of the property/space that is the source and/or cause of the water intrusion and who is responsible for maintaining that property/space. The answer is in the governing documents of the condominium complex. The primary document is normally the Covenants, Conditions, & Restrictions (CC&Rs), but there may be other governing documents such as California bylaws, rules and regulations, and rules of any architectural control committee or similar entity that address these issues.
The current version of the governing documents needs to be carefully reviewed before commencing any work. Too often, a homeowner will assume they have the most current version and fail to confirm that with the HOA/management company. OS sThe CC&Rs (1) will define what property/space (e.g., interior air space, common area, exclusive common area) is owned by the homeowner and any adjacent property owner and the HOA; (2) will identify who has the responsibility to maintain these areas; and (3) will identify any standards that maintenance must meet.
The CC&Rs may also contain restrictions or limitations on the maintenance obligations or the resulting impact for water intrusion. They may also contain procedures that need to be followed in the event of a water intrusion claim (e.g., notifying the management company, onsite maintenance company, etc.). The CC&Rs may also define what types of claims can be brought and against which parties and whether mediation and/or binding arbitration are the appropriate procedures for resolving any disputes.
The homeowner should consider notifying any potentially involved parties before making temporary repairs in order to give those parties the opportunity to be present with their retained professional(s) to evaluate the source and cause of the leak. For example, if it appears that the source of the water is in an area that is owned or maintained by the HOA or is coming from an adjoining owner’s unit, or a combination thereof, then consider contacting the HOA/management company and/or the adjoining unit owner.
In some instances, it will be necessary to contact a neighbor because the water intrusion appears to be coming from an upstairs or adjacent unit, even though that unit may not be the source of the water. In that case, the neighbor’s unit needs to be inspected by the qualified professional that the homeowner has retained in order to determine whether the unit is the source and cause of the water intrusion or is actually only a channel through which the water is passing. In this situation, there may be a dispute between that unit’s owner and the HOA on these issues. If that unit owner does not have the financial resources to fight this battle, it may fall on the homeowner to do so, especially if their unit is the one that has suffered the most damage.
The homeowner should consider contacting their insurance broker prior to commencing any work to find out(1) is there any coverage for the incident and/or the damages; (2) what are the ramifications if the homeowner potentially caused some or all of the water intrusion and (3) what can the insurance company do in helping to resolve coverage disputes with other parties. it. The homeowner should also request insurance information from any adjacent property owner and/or the HOA/management company. The timing of this notice can be a challenge because the homeowner is initially focused on trying to stop the entry of water and the damage it is causing.
The reason for giving notice is to give all parties and their insurance companies the opportunity to inspect and evaluate the conditions before repairs are made and those conditions are altered. This eliminates the potential for any party to claim that evidence has been altered or lost.
As noted above, the homeowner needs to consider the importance of evaluating and preserving the evidence in the event of a future dispute. Many homeowners do not expect there to be a dispute over these issues. Unfortunately, disputes do arise and may include the homeowner’s insurance company. Once notice is given and a date specified for the temporary repairs, the homeowner can then proceed with the repairs because notice has been given or all parties and their professionals can be present at the time the conditions and issues are evaluated.
If the homeowner makes a claim with their insurance company, the insurance company will usually retain a professional to evaluate all pertinent facts. A homeowner needs to realize, however, that the evaluation made by their insurance company will occur in the context of determining whether the damage is covered under the policy. That determination may not be consistent with the objectives and expectations of the homeowner. The homeowner should consider retaining their own qualified professional even though their insurance company may be doing so as well. Where disputes exist between the homeowner and their insurance company, the homeowner may need to retain a local attorney with experience in handling condominium repair disputes.
In order to avoid potential disputes about what people said and what was agreed to, a good practice is for the homeowner to confirm in writing all notices they provide and discussions they have with any party regarding the water intrusion issue. Many of us hear what we want to hear when we talk to another party who may be involved in the dispute. In order to avoid potential disagreements about what people said and what was agreed to, a good practice is to document such statements in writing. For instance, if someone makes a promise in a conversation, a follow-up email or text confirming what was promised is a good idea. This confirming communication should indicate when the discussion occurred, what was discussed, what was agreed to, the timeline for any performance, etc. If a homeowner receives a communication allegedly confirming such a discussion, they should review that communication to make sure that it accurately addresses all of the issues discussed and agreements reached. If it does not do so, then the homeowner needs to promptly reply with a communication correcting any omissions or inaccuracies.
The source of any money necessary to pay for the repairs of the damage caused by water intrusion will turn on who is responsible for the damage. Depending on the source and cause of the water intrusion, the age of the condominium unit, whether the California Right To Repair Act applies, and other factors, the potential responsible parties include the developer, the builder, the HOA, the management company (if there is one), adjoining property owners, and the homeowner.
An evaluation should be made as to what insurance coverage is available, if any, for any of these parties. Making a claim against some of these parties may require that procedures set forth in California law, the CC&Rs, and/or insurance policies are followed. The financial condition of the HOA should also be evaluated, including whether there are adequate reserves to cover any replacement, repairs, and/or maintenance. The CC&Rs and bylaws should be reviewed to determine if there is a basis for a special assessment to be imposed to address the necessary renovations and/or repairs. If the source and cause of the water intrusion turns out to be the homeowner’s responsibility, prior notice to that insurance company may provide financial protection for any claim.
On the other hand, if the homeowner has sustained damages that are the responsibility of other parties, they should start collecting quotes and documentation/information regarding the damages. This would include costs to repair the source and cause of the water intrusion, damage to cabinetry, flooring, fixtures, furniture, and/or personal property. The homeowner should locate all documents regarding the original purchase of these items; this paperwork will assist them in any disputes regarding their value. Having accurate and complete paperwork may also assist the homeowner in any disputes with the insurance company over the replacement value of any such item in the event that is what the policy provides for.
Any questions that a homeowner has regarding their ability to receive compensation from any party for the water-related issues should be directed to their attorney because there may be limitations on what the homeowner can legally recover.
There is a challenge whenever water enters a condominium unit because of all the legal, procedural, and practical issues that can arise. This article has highlighted only some of those issues. Understanding these issues and the impact that controlling the process and exchange of information has on the outcome will put a homeowner in a better position to protect their interests.