HOA Won't Pay Repair Bill

HOA Won’t Pay Repair Bill

Here’s why the homeowners association won’t agree to foot the entire bill for water damage to an owner’s unit.

Q: We own a condo in Atlanta as a secondary residence. About a year ago we discovered a portion of our floor was saturated with water. We discovered, and the property manager confirmed, that the leak was caused by a crack in the concrete breezeway floor and the water was the result of pressure washing completed by an homeowner association (HOA) employed contractor.

When notified of the issue, our property manager sought bids to correct the issue. It has been a year and the water has slowly spread. We opted not to repair the floor until they completed repairs. The property manager recently informed us that they have scheduled repairs with a date still to be determined.

Getting Rid of an HOA

The cost to replace the affected area in our condo is $1,200. We received two estimates from different sources and both arrived at that figure.

The property manager brought the issue to the HOA board which agreed to pay for 50 percent of the repairs. Since the issue was caused by the HOA, shouldn’t they be liable for the entire amount? I understand the premise that anything inside the walls is our responsibility, but this seems to be an exception. Thanks in advance for your insights.

A: Thanks for your question. We’ve had similar questions in the past and we’ve generally stated that you have to see what your HOA organizational documents provide. In our experience, most association documents provide that the HOA will only be responsible for repairs to the common areas of the building.

Why Do HOAs Have So Much Power?

This would mean that if you live in a high rise condominium building, you would be responsible for the airspace inside your unit — from the exterior windows to the exterior walls of your unit. Should you have a fire in your unit, you’d be responsible for the repairs to everything within the unit, including the interior walls, flooring, cabinetry, interior doors, electrical and plumbing fixtures and systems, air conditioning and heating distribution and units, appliances, and all of your personal belongings.

For example, if there is a fire in your building, the association would be responsible for the structural walls holding up the building, the corridors, the electrical and plumbing distribution systems within the building. In essence, each unit owner takes care of their own space and the building takes care of what is common to everybody.

We’ve simplified it quite a bit, but given these general facts, in your case, you would fix the damage within your unit and the association would have to repair any damage to the exterior walls or other areas of the building impacted by the water problem.

Common HOA Problems

There may be circumstances where an association has so violated its duty to repair and maintain the building, that a court would say that the general terms of the organizational documents shouldn’t apply and the association should be responsible for any damage caused by the association. We don’t know what your governing documents provide or any specific laws in the state in which you are located.

Practically speaking, you have $1,200 worth of damage. The association offered to pay half. That feels fair. You could hire an attorney who concentrates their practice on common interest homeowner associations but you might end up paying more to get their assistance than the $600 they are offering.

Separately, if the contractor that caused the damage was so careless that you can claim they were incompetent, that the association didn’t do their required due diligence in hiring that company or can prove that the contractor’s actions go well beyond a reasonable mistake, you might have a better chance at getting the association to foot the entire bill.

HOAs carry insurance to cover common areas of the building – not your unit

The bottom line is that your association has insurance to cover the common areas of the building. The association does not have insurance to cover the interior repairs of your unit unless you can prove that the contractor that caused the damage should be responsible for that damage. In that case, the contractor’s insurance might cover your loss or the association’s liability policy might kick in.

But all of this gets quite complicated. First you’d need to figure out what insurance coverage every party carries. Then, you’d need to figure out whether the deductibles in those policies are higher than the $1,200 worth of damage to your unit.

You can plead your case to the association. We suspect they understand that the contractor screwed up and caused the damage. Thus they are willing to have all of the unit owners reimburse you for half of your loss. We phrase it this way because when the association pays you, every owner is really pitching in to pay out the $600.

We’re just glad your loss wasn’t $50,000.