Apartment water leak

Question from Eileen updated on 8th February 2015:

Water is leaking into the apartment downstairs from mine caused by an open and uncapped pipe under my apartment's floor in the kitchen area. There is no leaking in my apartment. This pipe was installed for no particular purpose and is not attached to any fixture. The builder went broke two years ago. I am the first owner of this new apartment. I had arranged for a plumber to cut a big hole in the downstairs ceiling in order to cap the useless pipe. The leaking was fixed after the pipe was blocked/capped. Who should pay for plumbing repair (block/cap the pipe) and ceiling repair? Many thanks in advance for your advice.


Our expert Leanne MacKenzie responded:

In an apartment complex, the walls and ceilings between floors are generally classed as “shared property”, and therefore there would be a joint responsibility between neighbours for any issues in this area. However in this particular instance the damage appears to have been caused by a lack of workmanship on the part of the builder and therefore any liability should rest with him. Due to the builder’s financial situation it seems there is little or no recourse available to you in approaching him to cover the cost of the pipe and ceiling repairs. As the damage was not caused by any negligence on your part, technically there is no reason for you to pay for the plumbing (block/cap the pipe) and ceiling repair, although this will also depend on what arrangement you and your neighbour agreed to before to the work was carried out. Another option may be to approach the body corporate or seek legal advice on the best course of action to proceed from here. Unfortunately this is not really an insurance issue as it would be classed as an error in workmanship and design which is an exclusion under most  (if not all) property insurance policies.

Leanne MacKenzie has over 25 years experience in the New Zealand personal property insurance industry. As personal lines manager for Crombie Lockwood she has been instrumental in introducing the important changes that have been made in the sector over the last 12 months. “Every property owner owes it to themselves, as a landlord and a homeowner, to understand the new regime.” Leanne is based in the company’s national office in Auckland.

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