“Dealing with A Water Leak” – FCAP Managers Report

When a water leak occurs, many condominium associations prioritize figuring out who is responsible for the water leak and the resulting damages. However, in most cases, that is the wrong approach when dealing with a water leak.

Instead, if a water leak occurs, your condominium association should focus on engaging professionals to stop the leak, such as a plumber, as well as placing its insurance carriers and counsel on notice of the leak. That is because, regardless of who caused the water leak, the condominium association has a duty to protect the condominium, as well as carry adequate property insurance as to same.

To that end, Section 718.111(5)(a) of Florida Statutes expressly provides condominium associations the powerful right to access units “as necessary to prevent damage to the common elements or to a unit”:

(a) The association has the irrevocable right of access to each unit during reasonable hours, when necessary for the maintenance, repair, or replacement of any common elements or of any portion of a unit to be maintained by the association pursuant to the declaration or as necessary to prevent damage to the common elements or to a unit.

Furthermore, Section 718.111(11) of Florida Statutes effectively provides that, regardless of what your condominium association’s declaration might say on the matter, condominium associations are required to provide “adequate” property insurance as to the condominium property:

(11) INSURANCE.—In order to protect the safety, health, and welfare of the people of this state and to ensure consistency in the provision of insurance coverage to condominiums and their unit owners, this subsection applies to every residential condominium in this state, regardless of the date of its declaration of condominium. It is the intent of the Legislature to encourage lower or stable insurance premiums for associations described in this subsection.

(a) Every condominium association shall have adequate property insurance as determined under this paragraph, regardless of any requirement in the declaration of condominium for certain coverage by the association.

[….]

(f) Every property insurance policy issued or renewed on or after January 1, 2009, for the purpose of protecting the condominium must provide primary coverage for:

1. All portions of the condominium property as originally installed or replacement of like kind and quality, in accordance with the original plans and specifications.

2. All alterations or additions made to the condominium property or association property pursuant to s. 718.113(2).

3. The coverage must exclude all personal property within the unit or limited common elements, and floor, wall, and ceiling coverings, electrical fixtures, appliances, water heaters, water filters, built-in cabinets and countertops, and window treatments, including curtains, drapes, blinds, hardware, and similar window treatment components, or replacements of any of the foregoing which are located within the boundaries of the unit and serve only such unit. Such property and any insurance thereupon is the responsibility of the unit owner.

Additionally, Section 718.111(11) of Florida Statutes makes clear that if an insurable event, such as a water leak, damages insured condominium property, the condominium association is obligated, in most circumstances, to reconstruct, repair, or replace what was damaged as a common expense:

(j) Any portion of the condominium property that must be insured by the association against property loss pursuant to paragraph (f) which is damaged by an insurable event shall be reconstructed, repaired, or replaced as necessary by the association as a common expense. In the absence of an insurable event, the association or the unit owners shall be responsible for the reconstruction, repair, or replacement as determined by the maintenance provisions of the declaration or bylaws. All property insurance deductibles and other damages in excess of property insurance coverage under the property insurance policies maintained by the association are a common expense of the condominium, except that:

1. A unit owner is responsible for the costs of repair or replacement of any portion of the condominium property not paid by insurance proceeds if such damage is caused by intentional conduct, negligence, or failure to comply with the terms of the declaration or the rules of the association by a unit owner, the members of his or her family, unit occupants, tenants, guests, or invitees, without compromise of the subrogation rights of the insurer.

2. The provisions of subparagraph 1. regarding the financial responsibility of a unit owner for the costs of repairing or replacing other portions of the condominium property also apply to the costs of repair or replacement of personal property of other unit owners or the association, as well as other property, whether real or personal, which the unit owners are required to insure.

3. To the extent the cost of repair or reconstruction for which the unit owner is responsible under this paragraph is reimbursed to the association by insurance proceeds, and the association has collected the cost of such repair or reconstruction from the unit owner, the association shall reimburse the unit owner without the waiver of any rights of subrogation.

4. The association is not obligated to pay for reconstruction or repairs of property losses as a common expense if the property losses were known or should have been known to a unit owner and were not reported to the association until after the insurance claim of the association for that property was settled or resolved with finality, or denied because it was untimely filed.

In other words, more often than not, a condominium association is responsible for taking the first steps in addressing a water leak and the resulting damages, regardless of who caused it or may ultimately be responsible.

With that said, this article is not intended to be an exhaustive list of issues and concerns that a condominium association may need to deal with as a result of water leak. Rather, this article is intended to emphasize that your condominium association should always consult legal counsel early and often when it comes to water leaks, as the matter can be nuanced to navigate and costly to address if done so without proper planning and analysis.

To read the original FCAP article, please click here.