Liability for Water Damage in Leasehold Flat

Nihil5320

Afternoon,

I have an issue in which a leak from my flat caused water damage to neighbouring (downstairs) flat, the leak was resolved within an hour of being notified as the water was switched off. The source was identified and fixed the following day.

Shortly thereafter I was contacted by the management company regarding payment for damages to the downstairs flat, I presume they also provided my contact information to the landlady of the downstairs property (which is a buy-to-let) as she has since contacted me. The amount being claimed is just shy of the buildings insurance excess, so in this instance an insurance claim is unlikely to be made.

I initially queried whether I was liable under the terms of the lease with the management company, who were quite argumentative. Thankfully I checked before simply admitting liability and it would appear that, excluding cases of negligence, I would not be liable unless otherwise specified by the lease.

The problem is that the management company seem to have stuck (somewhat) with their position, and, despite my asking on numerous occasions, are yet to provide an explanation as to why they believe me to be liable or their interpretation of the lease.

Eventually I advised I would speak with the leasehold advisory service (LEASE), they were extraordinarily busy so unfortunately the advice was rather brief but they explained that the excess should be paid:

• by the party at fault, in cases of a fault-based claim;
• by the party making the claim (i.e. the landlady of the downstairs flat); or
• as specified by the lease.

The terms of the lease seems to be silent as to liability between leaseholders, so far as I can tell at least. There is a clause relating to keeping the property, including sewers, drains etc., in 'tenantable repair and condition' however the particular clause ends in an agreement to yield up the property on expiration of the lease so I would presume that this relates more to ensuring the property is not devalued prior to surrender.

Since speaking with LEASE the management company have advised that, as an alternative, I could submit an insurance claim via the building insurance company and let an insurance assessor make an interpretation of the lease. However me making an insurance claim to repair damage to a downstairs property, which has already been repaired, seems extremely odd.

It just seems somewhat unusual, I get the impression that the staff at the management company had a kneejerk reaction of 'the water is from flat x so flat x is responsible' and they don't actually appear to have any proper processes or policies in place. I am particularly concerned that they aren't able to provide an interpretation of the lease, and advising me to make an insurance claim as described above also seems rather strange.

I could just make the payment, but I'm currently studying whilst working full time, making a payment for repairs to a buy-to-let property if there is no strict liability is obviously a rather unattractive proposition.

TL;DR:
• Amount of damages is less than the excess.
• Management company are unable to provide an interpretation of the lease, despite initially advising the downstairs lessee that I am liable.
• Their suggested next step is that I make a claim for repairs already conducted to a downstairs property, for an assessment by an insurance assessor.

If anybody has been in a similar situation before, or if you have any legal training and know what to look for in the lease, any advice you could provide would be greatly appreciated.

The process laid out by the management company, and their advice thus far, just seems to be a complete mess and I'm not sure what my options are, short of having the terms of the lease professionally assessed.

Thanks

jonnygee2

I have an issue in which a leak from my flat caused water damage to neighbouring (downstairs) flat, the leak was resolved within an hour of being notified as the water was switched off. The source was identified and fixed the following day.

What caused the leak? I imagine this is the crux of the issue.

Is there any way your actions (or lack of action / maintenance) could have caused this leak?

G_M

If you were negligent, you are liable.

If there was simply a leak, through no fault of your own, you are not liable.

'Negligence' would be, for example:
* you knew of a problem (eg a slow drip) and ignored it till it became more serious
* you banged/knocked a pipe, eg while doing some other DIY, and failed to check if a leak had been caused
* You had heard water running/dripping, but failed to investigate.

Normal wear and tear over time that resulted in the leak would not be negligence.

Assuming you were not 'negligent', I would write a short (very short) letter to the Manco and/or Freeholder cc to the flat below, stating you were not negligent and therefore deny liability. Then ignore any further correspondance.

Of course, long term, this will impact on your neighbourly relations, as well as relations with the Manco, so an alternative might be to invite the downstairs flat owner to tea, bake a cake, have a chat, and offer to go halves on the cost........

Nihil5320

jonnygee2 wrote: »

What caused the leak? I imagine this is the crux of the issue.

Is there any way your actions (or lack of action / maintenance) could have caused this leak?

Oddly this doesn't seem to be disputed at all, it was a slow leak from a toilet cistern. The cisterns in these flats are all enclosed, with the flooring tiled, so the leak was not apparent until I was notified.

The issue of negligence hasn't even been raised, I did mention Rylands v Fletcher to the management company and was advised that they "do not consider that [the case] would be relevant in a leasehold landlord and tenant situation such as yours."

I didn't press the point but I'm fairly certain that is incorrect. Regardless their position seems to be that an insurance claim should be made, by myself, in respect of repairs to the downstairs property which have already been conducted, in order for an insurance assessor to interpret liability under the terms of the lease.

My experience with insurance is somewhat limited, but that just doesn't quite seem right. They have altered their position a few times and I have a feeling that they are just making it up as they go along.

Nihil5320

G_M wrote: »

Assuming you were not 'negligent', I would write a short (very short) letter to the Manco and/or Freeholder cc to the flat below, stating you were not negligent and therefore deny liability. Then ignore any further correspondance.

Of course, long term, this will impact on your neighbourly relations, as well as relations with the Manco, so an alternative might be to invite the downstairs flat owner to tea, bake a cake, have a chat, and offer to go halves on the cost........

I think that is probably the best course, it's a BTL property so I'm not dealing with the occupants in this case. I would probably be a little more amenable otherwise.

I'm just slightly bemused by the management company suggesting that I make a claim under the insurance for damage to a neighbouring flat, or their reliance on an insurance assessor to interpret the lease.

eddddy

Nihil5320 wrote: »

Regardless their position seems to be that an insurance claim should be made, by myself, in respect of repairs to the downstairs property which have already been conducted, in order for an insurance assessor to interpret liability under the terms of the lease.
.

I can't imagine that an insurance assessor would get involved in reading a lease to determine liability.

All the insurance assessor would do is decide whether there was a valid insurance claim.


I would agree with your initial assessment. Unless you were negligent (or the lease says otherwise), it's for the downstairs leaseholder to pay for repairs and/or make a insurance claim and pay the excess.

You should probably do nothing now, until either:

- your neighbour makes a court claim against you for the repair costs (which you would challenge).

- the freeholder sends you a service charge demand for the repair costs (which you would challenge).

bouicca21

If you make an insurance claim then the insurance company will either pay out or or payout whilst pursuing a claim for recovery. If it is your fault then they will pursue you for recovery. If it is a faulty installation they may decide to go after the contractor but if the installation was many years ago then they will probably let it go.

Tom99

I assume the damage, if insured at all, would be claimed from the freeholder's building insurance policy or, if contents, the downstairs flat's contents policy.

If it's the building policy are leaseholders recorded as interested parties or whatever on that policy? If not would it even be possible for a leaseholder to make a claim direct to the insurance co?

If the building insurance co admit it as a claim then will they not pay out to the insured party ie the freeholder?

What does the lease say about insurance, no doubt that the freeholder is to insure the building, but does it go on to say that the freeholder will make a claim and use the claimed amount to repair the property?

If this was tiles blowing off the roof the freeholder would pay the excess and presumable recover it in proportion from the leaseholders so maybe this claim should follow that route?