News
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Property and Building Management Law Alert - March 2017
Submitted by // K Bowers, Partner / Solicitor Advocate
16 March 2017


BLAME GAME

Introduction

This case concerned a water leakage dispute. The Plaintiffs were the registered owners of a property on the top floor of a residential building ("Property"). The Defendant was the IO of the building. The Plaintiffs commenced an action against the Defendant on the basis that the water leakage into the Property was caused by the disrepair of the external wall outside the Property ("External Wall").

Background

It was common ground that there were eaves built upon a supporting structure above the Property. In 2015, the Buildings Department sent a demand to the Plaintiffs and the IO ordering the removal of the eaves on the basis that the eaves were an 'unauthorised structure'. Although the eaves had deteriorated to quite an extent, neither the Plaintiffs nor the IO took any action to remove the supporting structure or the eaves. There were also cracks found in the External Wall.

The Plaintiffs' case was that the water leakage constituted nuisance, and that this nuisance was caused by the disrepair of the External Wall, which was a common part of the building and was consequently the responsibility of the IO to repair.

The IO disagreed and argued that the water leakage was caused by the eaves which had been built by the Plaintiffs. The Plaintiffs denied that the eaves had caused the water leakage.

Issues

The Court had to consider the following issues:-

1. whether the water leakage was caused by the disrepair of the External Wall, the supporting structure, or by the eaves; and

2. if the water leakage was caused by the supporting structure or the eaves, who was responsible for the damage?

Supporting structure

Having reviewed the expert evidence and the approved building plans, the Court found that the supporting structure already existed before the Plaintiffs bought the Property. The Court held that seeing as the supporting structure was not built by the Plaintiffs, and as the supporting structure was on the exterior of the building, the supporting structure fell within the responsibility of the IO, which was responsible for the upkeep of the common parts of the Property and had a duty to take action in respect of any structure added onto common parts..

What caused the water damage?

Upon considering the evidence given by the Plaintiffs and IO's respective expert witnesses, the Court held that although there were cracks in the External Wall, the water did not seep through these cracks into the Property. Instead, the water leakage was caused by water seepage through the cracks in the supporting structure.

However, the real question was how did the water seep through the supporting structure into the External Wall and then into the Property in the first place. On this point, the Court held that the water leakage was caused by rusting on the eaves, which caused and expanded the cracks in the supporting structure and that water seeped through these cracks and into the External Wall.

Although the IO was responsible for the supporting structure, seeing as the eaves had been built upon the Plaintiffs’ instructions, and as it was the rusty eaves built by the Plaintiffs which ultimately caused and expanded the cracks in the supporting structure leading to the water leakage, the IO was not held to be liable for the water leakage.

Chain of causation

The Plaintiffs argued that even on a finding that the rusty eaves had damaged the supporting structure to allow water to seep through, the cause of the water leakage was broken by the IO’s failure to discharge its statutory duty under section 18 of the Building Management Ordinance (Cap. 344) to maintain the exterior of the building, which included the supporting structure.

The Court rejected this argument, and held that 'but for' the rusty eaves, there would not have been any water seepage into the Property. The Plaintiffs must have 'reasonably foreseen' that there would be water leakage if they added the eaves which were bound to cause damage to the supporting structure with the passage of time without proper maintenance. The Plaintiffs must also have reasonably foreseen that the IO would not promptly maintain and repair the supporting structure, especially when the eaves were still there, despite the maintenance and repair of the supporting structure being the IO's duty. Consequently, the IO's failure to maintain the common parts did not break the chain of causation.

The Court highlighted that in this case, it was important that the water leakage occurred inside the Property, and that the cause of the water leakage was not clearly known. Insofar as it was thought that the roof was the cause, the IO did repair the Roof in 2003. In 2007, the Plaintiffs complained to the IO about water leakage inside the Property, but the cause was unknown, and the Plaintiffs did not chase the IO for a response, and whilst the IO had a duty to maintain the exterior of the building, it did not have any duty to investigate the cause of water leakage in the Property.

Judgment

Consequently, the Court ordered the Plaintiffs to remove the eaves. The Court also ordered that the supporting structure had to be repaired (or removed), but since the supporting structure was part of the exterior, the IO was responsible for this work. The Court held that it was the IO's decision whether or not to remove the supporting structure. However, if after the Plaintiffs had removed the eaves, the water leakage problem persisted, it would appear that the IO would be liable.

Take-away

In many building management cases, it is difficult to ascertain the ultimate cause of water damage. Although in this case, the owners were ultimately liable for the water damage (the Court rejecting the Plaintiffs' argument that the IO's breach of its statutory duty broke the chain of causation), building managers should nonetheless be acutely aware of the duty to maintain and repair the common parts of the building. This judgment helpfully clarifies that the IO should be responsible for taking action in respect of any structure added onto common parts (even if it may be unclear when and who added the structure). When in doubt about liability to maintain and repair common parts, building managers should review the Deed of Mutual Covenant for the building and check the contractual terms of its appointment by the incorporated owners (and seek legal advice)!

 

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