The lower Court had decided that a Strata lot owner was responsible for damage falling within the deductible on the corporation’s policy even in the absence of negligence. [See Condo Cases Across Canada – Part 16 – November, 2006].

 On appeal, the decision was upheld.

Water damage was caused to the defendant’s strata unit by the failure of a coupling within the wall of the unit.  There was no negligence and there was no common property damage.  The damage was determined to relate to a loss insured under the strata corporation’s insurance policy.  However, the loss fell below the $10,000 deductible on the policy.   

Although the by-laws of the strata corporation require that the corporation arrange insurance covering this type of loss, the by-laws do not impose any maximum deductible.  The Court said: “presumably the council has decided on the amount of $10,000 or the insurers have imposed it”.  The Court accordingly held that it was proper for the corporation to negotiate such a deductible. 

Since this was damage to the strata unit, the strata lot owner was responsible for the damage not covered by the corporation’s insurance (i.e., falling within the deductible).  The Court found, however, that the owner’s insurance policy provided coverage for this loss.  Therefore, the Court held that the owner’s insurer should cover all of the loss apart from the $500 deductible on the owner’s insurance policy.  The owner was required to pay that $500 deductible.