Yulia Pesin Deo Condominium Lawyers
Insurance
Leaking Toilets, Fires, and Kai Zachary and Clara Rose from unit Everything inget Between 5819 decided to away for the weekend, leaving their condominium unit unattended for two days. Unbeknownst to them, the toilet valve Rose in their ensuite Kai Zachary and Clara from unit bathroom wastodeteriorating for weeksome 5819 decided get away for the time. As the laws of the universe will have end, leaving their condominium unit it, the toiletfor valve down during unattended two broke days. Unbeknownst Kaithem, and Clara’s weekend Water to the toilet valve getaway. in their ensuite quickly filled thedeteriorating ensuite toilet and overbathroom was for some flowed the of unit’s bathroom time. Asonto the laws the universe willfloor. have Four later, Kaibroke and Clara’s was it, thehours toilet valve downunit during flooded water, as were sevenWater other Kai and with Clara’s weekend getaway. units below four units adjacent to quickly filledand the ensuite toilet and overtheirs. The emergency flowed onto condominium’s the unit’s bathroom floor. remediation and Kai repair forunit the was waFour hours later, andcosts Clara’s ter damage flooded withtotalled water, asover were$100,000.00. seven other Thankfully, had water units below the andcondominium four units adjacent to escape insurance coverage, albeit it cartheirs. The condominium’s emergency ries a $25,000.00 deductible. As the is comremediation and repair costs for wamondamage in thesetotalled circumstances, a dispute ter over $100,000.00. arose between and Clara had andwater their Thankfully, theKai condominium condominium, as to who wasalbeit responsible escape insurance coverage, it carfor the cost to repair the flood ries a $25,000.00 deductible. Asdamage is comand toinwhat extent. mon these circumstances, a dispute arose between Kai and Clara and their The condominium Ms. Sophia condominium, as tomanager, who was responsible Aubree, at the the Board of for the cost to direction repair theofflood damage Directors, a chargeback letter to and to whatissued extent. Kai and Clara, seeking reimbursement of the $25,000.00 manager, deductible. and The condominium Ms.Kai Sophia Clara, however, were adamant they Aubree, at the direction of the that Board of cannot be held liable for the deductible Directors, issued a chargeback letter to amount. they were not at fault! Kai and After Clara,all, seeking reimbursement
n o i t a r t s g: u l l I din n Pen ome o to c nday Mo
of the $25,000.00 deductible. Kai and Clara, however, were adamant that they How were cannot be held theyliable to know for the thatdeductible their toilet valveAfter amount. was deteriorating all, they were not andatwould fault! breakdown How were they on their to know weekend thataway? their The toidispute let valvebetween was deteriorating Kai and Clara and andwould their condominium breakdown on their quickly weekend escalated, away?with The both parties dispute between retaining Kai and counsel. Clara and their condominium quickly escalated, with Manyparties both of us inretaining the condominium counsel. industry know the above scenario to be a “condo classic”. Many ofNeither us in thethe condominium factual circumstancindustry es northe know theabove legal scenario framework to be of acharge“condo backs are classic”. Neither new. the Yet,factual the interpretation circumstancandnor es application the legal offramework chargebacks of chargecontinues to are backs cause new. much Yet, confusion the interpretation for condominium and application managers, of chargebacks board members, continand unittoowners ues cause much alike. confusion Much of this for condohas to do with managers, minium the intricate board and members, technical and nuancesowners unit of chargeback alike. Much provisions of this andhas their to broad do with interpretations the intricate and depending technical on nuthe preciseofwording ances chargeback of the provisions provisions andintheir the Condominium broad interpretations Act, 1998 depending (the “Act”), on the
precise wording of the provisions in the Condominium Act, 1998 (the “Act”), the declaration and by-laws of the corporation. Below, we breakdown some of these technical nuances and dispel much of the confusion surrounding chargebacks. Section 105 of the Act governs insurance deductibles. Subsection 105(1) of the Act provides that if a condominium’s insurance policy carries a deductible, the amount of the deductible shall be a common expense. This subsection applies to scenarios where the damage is either caused to a condominium’s common elements and/or originates from the common elements (e.g. hallways, stairways, lobby, recreational facilities, parking garage etc.). In this circumstance, the condominium’s insurance company will pay for the repair costs to the common elements and/or any affected units, however, the condominium will be responsible CONDOVOICE SUMMER 2022
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ILLUSTRATION BY CLAYTON HANMER
Navigating the Chargeback Matrix Leaking Toilets, Fires, and Everything in Between Matrix
