Margaret and Peter are building managers in an apartment block. They live in one of the apartments and own several others which are rented out. One of the rented apartments suffered water damage during the tenant’s temporary absence. When Peter noticed water outside the apartment door and accessed the apartment, he discovered the kitchen tap was leaking. Water had damaged the bench top and cabinets and the tiled floor was wet. Peter immediately turned off the water and decided to replace the damaged tap which he did within 24 hours. Peter then arranged for removal of excess water from the carpets and dried out the apartment with dehumidifiers.
Margaret and Peter made a claim to the property’s insurance company, Make It Right, for the cost of replacing the tap and the bench top and cabinet that had suffered water damage. The insurance assessor’s report confirmed the damage to the bench top and cabinet was consistent with water damage but suggested the damage was caused by a combination of the kitchen tap leaking over a period of time and the sudden flood when the tap failed. Because the faulty tap had been replaced there was no way to establish why or how it had failed but there was no mould, mildew or rot to suggest there was ongoing gradual water damage. Make It Right declined Margaret and Peter’s claim.
Margaret and Peter did not accept Make It Right’s decision, and pointed out that they had made a full inspection of the apartment only a month earlier when the previous tenant had left shortly before that. A week into a new tenancy, Peter had replaced a light bulb in the range hood and there was no sign of a leak then. Peter managed to retrieve the old tap and gave it to the insurance assessor who arranged for a plumber to inspect it. The plumber’s report said tests showed that the cold water braided flexi hose within the cabinet had sprung a leak due to the way it had been installed – there was nothing to suggest the tap itself was the cause of the water leak. The assessor submitted a second report to Make It Right. The report concluded that the leaking flexi hose could not have caused the damage to the bench top, although water from the hose could have sprayed onto the base of the bench top. The bench top damage was more consistent with normal wear and tear. The claim was again declined.
Make It Right’s position
Make It Right said that the actual damage claimed for was in conflict with the type of damage that would have been caused by the tap fitting failure that occurred. The damage was more consistent with water splashing or leaking around the tap and trickling down the cabinet over time. Gradual wear and tear was excluded under the terms of the policy and for this reason the claim was declined.
FSCL’S view and resolution
This was a difficult complaint to assess. There was no dispute that the failure of the flexi hose would have flooded the cabinet. Water could have sprayed up under the bench top but it would have required considerable pressure for water to have penetrated to the top bench surface. However Margaret and Peter confirmed that water was spraying upwards and all over the kitchen bench. Because Peter had removed the original tap fitting it was impossible to confirm how the water was spraying. The damage to the bench top was in a specific area and we would have expected to see significant damage to the area of particle board directly beneath the affected area. However the damage to the cabinet was at floor level. Without the tap fitting in place, we could not determine how the damage was caused. Taking into account the age of the tap and bench top, approximately 10 years, it was simply not possible to conclude that the damage was caused by the failure of the braided flexi hose rather than the result of gradual wear and tear.
We approached Make It Right and explained the difficulty we faced in making a decision based on the available facts. We suggested that an equitable way to resolve matters would be for the cost of repairs to be split equally between the parties. Make It Right agreed to meet half the cost of the claim and Margaret and Peter agreed to pay the other half. The complaint was resolved.