Condo water leak in Ontario: who is responsible?

This is general information, not legal advice. Each condominium’s declaration and by-laws are different, and they decide the details.

Why condo leaks are complicated

In a house, one owner and one insurer deal with the whole loss. In a condominium, a single leak can involve:

• The unit where it started
• The units below and beside it
• Common elements such as risers, corridors and ceilings
• The corporation’s insurer
• Several unit owners’ insurers
• Tenants and their insurers

Sorting out who repairs and who pays takes longer than drying the building, which is why the emergency work should start at once and the paperwork follow.

First steps for any resident

1. Stop the water if it is in your unit. Know where your unit’s shut-off valves are.
2. Call the property manager or the building’s emergency line. Do this even if the water is coming from elsewhere.
3. Tell the unit above or below.
4. Photograph and video the water, its source if visible, and the damage.
5. Move belongings out of the way.
6. Call your own insurer or broker.
7. Let the corporation’s contractor in. Corporations generally have a right of entry in an emergency.

Who repairs what

As a general pattern under Ontario’s Condominium Act:

• The corporation insures the common elements and the units themselves, but only to the level of a “standard unit” defined in its by-law or declaration. It normally arranges the emergency response and the repair of the building.
• Each owner is responsible for improvements beyond the standard unit, such as upgraded flooring, cabinets or fixtures, and for their own belongings.
• A tenant is responsible for their own belongings.

What counts as an improvement depends on the standard unit definition. Ask management for a copy.

Who pays

Responsibility for repair and responsibility for cost are separate questions.

• The corporation’s policy usually has a large deductible. Many declarations or by-laws allow the corporation to charge that deductible, or the cost of repairs up to it, back to the owner of the unit where the leak originated, in some cases regardless of fault.
• Your own condo unit policy can cover that chargeback, your improvements, your contents, and living expenses if you have to move out.
• If the leak came from a common element, such as a riser, the corporation is generally responsible.

Because of deductible chargebacks, a leak from your washing machine hose can produce a large bill even though the corporation’s insurer handles the building repair. This is the main reason unit owner insurance matters.

What your unit owner policy should include

• Contents
• Improvements and betterments
• Coverage for the corporation’s deductible
• Additional living expenses
• Loss assessment coverage
• Personal liability
• Sewer backup and water coverages where relevant to your floor

Check the limit for the deductible coverage against the corporation’s actual deductible, which management can tell you.

If you rent the unit out

The owner still needs a policy covering the unit, the deductible exposure and liability. The tenant needs their own policy for belongings and liability. A tenant’s negligence can lead to a claim against them.

What the restoration work looks like

• Water is extracted and the source confirmed
• Each affected unit and common area is assessed and documented separately
• Wet drywall, insulation and flooring are removed as needed
• Drying equipment runs in several units at once
• Rebuild is scoped per unit so that each insurer sees its own part

Access to every affected unit is essential. One unit that cannot be entered can hold up drying for the whole stack.

Preventing it in your own unit

• Replace washing machine, dishwasher and toilet supply hoses on a schedule
• Know where the shut-offs are and test them
• Never leave a running appliance unattended when you go out
• Fit leak sensors, and an automatic shut-off if the corporation allows
• Report slow drips and running toilets promptly

Common sources of condo leaks

• Washing machine, dishwasher and fridge supply hoses
• Toilet supply lines and overflowing toilets and tubs
• Failed shower pans and tub surrounds
• Hot water tanks and fan coil units inside the unit, including blocked condensate drains
• Kitchen stack backups, where a blocked shared drain sends water up through sinks on lower floors
• Risers and other shared pipes inside the walls
• Sprinkler heads and lines
• Windows, balcony doors and the roof

Whether the source is part of the unit or a common element is often the deciding fact, and it is not always obvious. Fan coil units are a frequent point of dispute. The declaration says who owns and maintains what.

Keep your own record

• Dated photographs and video of the damage and the source
• The time you reported it, and to whom
• Names of the contractors who attended and what they did
• Copies of emails with management
• A list of damaged belongings and improvements
• Receipts for anything you paid for

If you disagree with a chargeback

Ask the corporation, in writing, for the provision in the declaration or by-law it relies on, and for the invoices and the insurance deductible amount. Pass these to your own insurer, which may deal with the corporation directly. Disagreements between owners and corporations over the declaration and by-laws, which is where chargebacks usually fall, are generally dealt with by mediation and arbitration under the Condominium Act. A lawyer who handles condominium matters can tell you which route applies.

More: water damage restoration.