Water damage in Sectional Title Schemes – whose responsibility is it?

Jul 9, 2021 | Project Loans

One of the most common headaches in Sectional Title Schemes comes in the form of water leaks. These can be anything from leaky pipes inside buildings, to showers or washing machines leaking water into other units. The damage caused by water leaks can be major and disputes often arise around who is liable for the cost of repairing the water damage, particularly when individual units are affected. Let’s do a quick rundown of where the responsibility lies for repairing water damage in Sectional Title Schemes and how these mishaps can be avoided. 

Who is responsible? 

Water leaks commonly originate from roofs, walls or building foundations. These areas are classified as common property, so the body corporate is liable to repair them. If the leak has caused damage to the inside of properties within the scheme, the body corporate is responsible for these repairs as well. Community scheme property owners all contribute to the maintenance of the scheme by paying levies.  Whilst a ground floor owner may not be impacted by a leaking roof, for example, it’s important that they pay their levies so that the roof can be maintained. 

On the other hand, water leaks that come from inside a unit are a different story. The origin of the leak needs to be determined, and if the leak is coming from a pipe inside the unit, that unit’s owner will then be responsible for repairing the pipe. This includes any excess on their insurance as well. If the leak has extended into another unit and caused water damage, the owner of the property where the leak originated is liable for repairs in the other unit as well. 

Maintenance is key

Water leaks can easily occur from a lack of maintenance. Things like roofs, pipes and gutters tend to deteriorate over the years and if they aren’t maintained properly, problems are sure to arise. If this happens, the insurance company will determine where the responsibility lies for this. So, who is responsible for maintenance?

Property owners are responsible for the maintenance of their section or unit, and for any cables or pipes that are situated in their section, provided that they service that section. Body corporates are responsible for the maintenance and repairs of common property in a Sectional Title Scheme. So, it’s a good idea for body corporates to hold regular meetings to make sure that properties in the scheme are maintained correctly and well ahead of time. Common property refers to any part of land and/or building that doesn’t belong to a specific unit or section. This also includes other areas such as swimming pools, boundary walls, shared parking facilities and so on. 

Body corporates now need to make provision for a 10-year reserve fund for maintenance, according to the Sectional Title Schemes Management Act (STSMA). This is a specific fund that should be managed alongside the Administrative Fund and levies are to be allocated into each fund separately. The idea of the reserve fund is to cover any unexpected repairs or maintenance costs that may occur but haven’t been budgeted for. This reserve fund should be accompanied by a 10-year maintenance plan which should show how the fund will be spent on maintaining the scheme over the next 10 years. This plan should include things like waterproofing, exterior painting, servicing lifts, repairs to carports and so on. Trustees should also report back to the owners every year, to keep them up to date on what is being done. This is one of the best, most thorough ways to stay on top of the maintenance tasks required in a Sectional Title Scheme and avoid major mishaps like leaking pipes. 

How can we help?   

We’re in the business of helping community schemes and should you have water damage, we’ve got just the solution for your Sectional Title Scheme. It’s called Project Loans and it could be the answer to many unexpected issues that happen in your scheme. Our Project Loans financing option is ideal for maintenance, upgrades, repairs, and much more. Your body corporate can get funds immediately from the Project Loans solution, after choosing the amount that is needed, and then enjoy flexible repayment terms of up to 5 years. You’ll only pay interest on what you use and when you use it. If your body corporate simply doesn’t have the funds to deal with water damage or any other mishap, our Project Loans solution is just the financing option for you. Click here to take a look at all the benefits that our Project Loans can offer your Sectional Title Scheme.