New rules that came into effect at the beginning of the year mean Alberta condo owners could be on the hook for upwards of $50,000 if damage is caused within their unit.
Effective Jan. 1, 2020, condominium corporations will be able to seek recovery of the deductible portion of the corporation’s insurance claim — up to a maximum of $50,000 — from a condo owner for any damage that originates in their suite or private area.
“That means that if something happens in the unit and it’s not your fault — the toilet explodes, there’s water loss, water damage goes through to the floors below — and there’s a $50,000 deductible or a $25,000 deductible, the owners are now responsible for the deductible,” Todd Shipley, of Reynolds Mirth Richards & Farmer LLP, explained at a recent Canadian Condominium Institute educational event.
This means the owner may be responsible to pay the corporation’s deductible amount regardless of whether there was any proven negligence, according to the CCI.
“The typical example, and we’ve seen this in Edmonton in the past few years, is when someone is smoking on their balcony and they put out their cigarette in a flower pot and then within minutes or hours, the entire balcony is engulfed in flames and perhaps the entire building within an hour is engulfed in flames,” explained lawyer Robert Noce, who specializes in real estate and condominium law.