Ask Atty Pat: How To Get The Association To Pay And Repair Ice Damming

My farmer uncle, when stubborn people frustrated him, would say “Sometimes you have to hit a mule with a 2 x 4 to get his attention.” Unfortunately, the expression applies to some condominium boards and management companies.

I have been approached by groups of unit owners who have dealt with ice damming, resultant unit damage and the failure of the Association to repair the damaged roofs and units.

After insurance companies were pummeled with ice damming claims within recent years, the insurance companies decided that the damage to each unit constituted a separate claim and applied the policy deductible to each unit. Many condominiums have deductibles of $5000 or $10,000. If the deductible were applied to each unit, one hundred damaged units would mean the deductible application of $500,000 to $1,000,000.

When ice damming returned with a vengeance last winter, a significant number of Associations were faced with numerous damaged units and multiple damaged roofs. The Associations turned to their insurance companies and found that the policy deductibles resulted in no coverage or limited coverage for each unit.

A few Associations girded their loins, lit their lamps and addressed the damage immediately. Repairs were made promptly to the roofs and the units through special assessments, expenditure of reserves or bank loans.

Unfortunately, some Associations have still not made repairs to roofs and units. The more stubborn Associations, some guided by their management, have attempted to force the unit owners to swallow the Association’s deductible or to make the repairs themselves. When the unit owners approached their individual unit insurers, many found that the unit owner insurers refused to pay the deductible stating accurately that the Association’s insurer was the primary carrier.

The Associations that are trying to foist or have successfully foisted the Association deductible back on the unit owners are violating the Common Interest Ownership Act. Section 47-255 of the Act, which also applies to condominiums that pre-existed the Act, mandates that condominiums having units with horizontal boundaries must insure those portions of the units that would normally be insured by a home owner’s policy. The insured areas would include the floors, walls, ceilings, some fixtures, plumbing, electrical wiring, and items affixed to the wall or floor, like cabinets. The Association’s insurer is named as the primary insurer for these unit areas.

Section 47-255 continues that if areas of the unit for which insurance was required are damaged because of a casualty, the Association is required to fix the damage to the unit. It is important to note that the provision only applies to damage that would be an insured casualty loss, like fire or weather damage, not to day to day wear and tear. Section 47-255 further states that any cost for the repairs that is not covered by the Association’s insurance proceeds is a common expense assessed against all unit owners. Even the deductible is a common expense that must be assessed against all unit owners. Section 47-255 clearly states that the Association must promptly make the repairs.

The Associations that are trying to blackmail or bluff the unit owners into making their own repairs are violating the law. The Associations trying to foist the responsibility for the Association deductible onto the units are violating the law. The Associations delaying repairs are violating the law.

Despite the clear provisions in the Common Interest Ownership Act, some stubborn boards shirk their repair responsibility. Some managers, who should know the law, ignore the legal repair requirements to gratify the Board. Other management companies actively advise the Boards to act in violation of the law. To quote Ben Franklin: “Nothing ventured, nothing gained!”

Which brings me to a group of ten unit owners from an Association that has failed to repair roof damage, forced unit owners to make their own repairs, and demanded that individual unit owners cover the Association deductibles. They sought my advice.

The unit owners can sue the Association to force the Association to obey the law and to make the repairs and cover the costs. Litigation is expensive and the cost of litigation may be more than the cost of repairs. In addition, the unit owners may have already paid for unit repairs and are cash poor. Other unit owners can’t wait for litigation to wend its way through the courts. Unit damage may be significant. Mold may have materialized. Another winter is coming and without repairs, the units will be damaged again.

So, what shall I use as my 2 x 4 to get the Association’s attention without requiring a large retainer, incurring significant bills and waiting for years for the case to be resolved? I decided to have each unit owner bring an individual claim in small claims court against the Association, the management company, and, if there is sufficient evidence, the individual board members. Ten unit owners equals ten small claims actions. I agreed to assist the unit owners in drafting their complaints, completing the forms, arranging for service, filing and presenting their evidence at hearing.

The small claims process is relatively speedy, but the jurisdiction of the small claims court is limited to $7500 in damages. The small claims court cannot issue performance orders, only award damages.

The successful claimant will recover the $90 court entry fee and the marshal’s service fee, usually less than $200. Some of the unit owners protested that $7500 was insufficient for repairs. I reminded them of the 2 x 4 theory. I then explained that depending upon how the small claims case is brought, the unit owner may still be able to bring another action for unrecovered damages in the regular Superior Court. For example, a unit owner’s small claims action is based on breach of contract. There are some interesting cases that imply that the unit owner could bring a second action in regular court for unpaid damages based on another legal theory, like violation of the Act or negligence.

So, how do these small claims actions act as my 2 x 4?
1. The Association will be defending ten different actions and will have to hire counsel. There is some precedent that corporations, like the Association, can not appear in court on their own behalf and must have counsel.
2. If the cases are filed at intervals, there will be ten different hearings on ten different days. Somebody will have to attend each hearing. I recommended that cases be filed at least a week apart.
3. The Association will have to notify their insurer that the Association is now the defendant in ten cases, with a total exposure of $75,000. The insurance company will investigate and perhaps drop the Association’s coverage. Because some policies exclude breach of contract or violation of law, the insurer may deny coverage. In that event, the Association will have to pay for its own defense and the ultimate judgment in favor of a unit owner.
4. If there are flaws in the initial cases, these flaws can be corrected in later cases.
5. The total recovery against the Association in small claims will be $75,000, plus costs and ten percent interest, if everyone prevails.
6. Unit owners that have made repairs can seek reimbursement using their receipts. Unit owners that have not yet made repairs can get estimates and claim the amount of the estimate.
7. The management company will probably win the claim against them saying the Board made the decision. Based on the management contract, the Association will have to indemnify the management company against loss. The Association will indemnify the management company for legal defense and pay any judgment. The management contract may also provide that the manager is paid extra for each hour spent in litigation.. The management company will definitely hire an attorney, at the Association’s expense, and cheerfully attend the hearings.

The Association may heed the unit owners’ complaints. That is the hope. The Association may realize that it is cheaper to make and pay for the repairs, then to defend a series of law suits. Huge litigation expenses will make the Board very unpopular with all of the unit owners. If the management company gave bad advice, the Board may consider terminating the company.

Let’s hope that I get an opportunity to swing my 2 x 4.

Pat Ayars is a Glastonbury attorney who specializes in condo issues. She is a member of the Connecticut Condo Association Advisory Committee.

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8 Responses to Ask Atty Pat: How To Get The Association To Pay And Repair Ice Damming

  1. Jim says:

    I know that many years ago the association was responsibnle for up to the exterior of the drywall in the units. I know some laws have changed and new laws have come into effect in regards to what is covered by the association. But, my question is if the roof is covered by the association and the gutters are maintained and cleaned by the association then why would an ice dam belong to the unit owner. I am not sure what the associations bilaws state as far as the gutters and roof being covered. It would be interesting to see how this play out. My money is on the unit owners

  2. jackie mcbee says:

    my goodness. how timely this was. I had this happen to me. water POURED into my unit during the winter. It was extremely bad. both the management company and board ignored my complaints. I almost called the fire department. eventually the snow melted, water stopped. my rug was damaged. they “cleaned” it but by then it was too late and stains could not be repaired. after a very strong letter the board voted to pay for a new rug (albeit not for a good rug) good for them because I was prepared for small claims court. and the humor now is that they want a receipt from me that I got the new rug…NEVER…eventually I will tell them the cancelled check is their receipt…

    • Pat Ayars says:

      A cancelled check can function as a receipt. You can also get a receipt from the seller of your rug.

      By the way, unless the Association provides a list of standard items that were installed in the original unit, the Association is also responsible for damages to improvements and betterments installed by the unit owner in the event of casualty.

      I am glad you were persistent.

  3. Tom Villano says:

    Several years ago, our board asked the owners to agree to amend our declarations to look to each units insurance coverage for the deductible (the association’s is $5,000). Even though I was in favor of this amendment, since my HOA policy covers this and I pay for this coverage, the owners never supported the amendment even after many meetings to explain the risk and after a year or so the board dropped the subject. This always confused me, because at the end of the day the members pay for it anyway. As with most associations, owners seem to be distrustful of condo boards. Let me get to my question. Of the insurance companies that decided to treat each damaged unit as a separate claim, was this a surprise to the association’s that Attorney Ayars mentioned, or was this stated in their insurance contract?

    • Pat Ayars says:

      Tom:

      If your condominium has more than 12 units and the units have horizontal boundaries, the Association must insure those parts of the unit that would normally be covered under a home owners policy. If the portions of the units for which insurance is mandated is damaged in a casualty, the Association must repair the damage to the unit promptly. Any shortfall after insurance payments, including the deductible, is a common expense. The proposed amendment is now clearly illegal.

      And on to your question:
      The language is in the insurance contract. Insurance agents should have informed the board of the change. In 2011, there were many articles published on the subject. It should not have been a surprise, but many boards were surprised because no one told them. I, myself, hate reading insurance policies and most board members don’t read the policy and are confused if they do.
      If the language is not in the insurance policy or an amendment thereto, the insurance company, by refusing to pay a claim, could be engaged in unfair insurance practices.

  4. Pat Ayars says:

    Gail Egan has pointed out that many HO-6 policies, that is the individual unit owner policies, offer loss assessment coverage. This coverage protects the individual owner from a special assessments and can be purchased in amounts up to $100,000. I recall that the premium was very cheap, less than a regular trips to the barista for lattes.

    As Gail notes, many unit owners only purchase the policy minimum, which generally is only $1000. Gail warns that the coverage only applies to liability claims and covered losses and not regular maintenance or latent construction defects.

    I hope that Gail will provide more information for our readers.

  5. Judith Harlow says:

    Dear Attorney Ayars,

    I read your article regarding payment for ice damages. You did not address subsection 47247(c)(2) of the CIOA “to the extend required by the declaration any expense or portion thereof benefitting fewer than all of the units or their owners may be assessed exclusively against the units benefitted.” This is being given as a reason for individual owners at my condominium association to pay for ice damages. Could you please address this?

  6. andrea cruz says:

    2 of my units had ice damage the management company started fixing my units removing wall ,ceiling floor and never finished the repair i lost rental income section 8 stop paying rent after they inspect it the units the association gave me the run around for almost 2 years that they steel waiting for insurance money to finish with the repair the insurance company told me that they send the money already to my association to make it long history short the treasurer who run the association by himself bicouse the board has no voice he tome that the only way he will pay is if the court order him i was a bird member for a year and he never presented the to the board financial report or gave us invoice of his salary we don’t know exactly how much he is paying himself now i have my case pending in court for breach of contract andrea cruz vs bradley garden in waterbury now i need help to suit him for violating the law for running the association by himself and hiding the amount of his salary and financial record from the board his mother is the president so the mother and son run are money and we have no voice he remove me from the board bicouse I’m suing the association i will appreciate if you can write an article of how we can make him show financial report and respect the board we need to remove him no attorney want to get involve please help

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