Cloosing gate on uninsured claims

QUESTION: An owner’s car was recently damaged by the automatic garage door as it closed on the car’s bumper. Apparently the sensors did not detect that the car was still in range of the door as most of the car had passed through.

The owner submitted a claim to the owners corporation’s insurance company to repay the excess he had to pay after claiming through his own insurer. The insurance company declined the claim, stating there was no negligence.

The executive committee has now been asked to vote on whether we should reimburse the owner. One executive committee member (who is a lawyer) says it’s up to the insurers to decide.  The Owners Corporation can only pay for damage caused by negligence and as this is not a case of negligence it would have to be an “ex gratia” payment, which the executive committee is not allowed to make.

I feel that as the damage was caused by common property at no fault of the owner, we should pay. Who’s right? – Jen, via Forum.

ANSWER: First of all, the insurer is not judge and jury on who’s to blame.  They have decided it’s not covered by them, which justifies them not paying out.  However, that’s a decision that could be challenged in court, and probably would be if there were much larger sums involved.

But unless the driver of the car was at fault, you have to assume there’s a problem with the garage gate. It’s common property, therefore you probably do have to pay.  Unfortunately your insurer has chosen not to cover you so this has to come out of your admin fund.

But the lawyer on your EC (I bet they’re not a strata lawyer) shouldn’t make the common mistake that lack of cover means no liability – it just means that if you are liable then you have to find the funds somewhere else.

It’s a bill that probably has to be paid, simple as that. Ex gratia payments to committee members are a whole different issue.

Read the whole issue HERE.