I live in a 2-story condo building (renting), with units on both the first and second floor. The neighbor's 2nd story vacant condo had a pipe burst, and water gushed into the first floor as well as into neighboring first floor units. The water department was called to turn off water to the vacant unit. At this point, it isn't entirely clear the extent of the entire damage. But since it involves multiple units/parties, it is going to be a messy situation. Who is responsible/which insurance covers this situation for damage to my personal belongings, damage to my unit (structure), and the costs for the cleanup?

ANSWER

The BIDaWIZ Team's Answer:

The situation required us to review the Michigan Condominium Act of 1978 Section 559.212 as well as guide to Tenants and Landlords in Michigan. In terms of your personal belongings, your renter's insurance policy should cover the damage and filing a claim is likely the quickest way to be paid. Most policies will not increase the rate due to the nature of this event, but please confirm that with your policy provider. In terms of who is liable, most rental agreements in the state of Michigan include language that states the landlord and/or condo association are not responsible for damage to tenant's personal property, unless there is negligence or intentional actions. It may be argued that the flood would not have occurred had the condo not been vacant or proactive measures were taken. Again, filing a claim through your renter's insurance policy will likely be the fastest remedy for the loss of your personal belongings. With regards to your unit, you are not responsible for damage. As a renter your liabilities and responsibilities are limited given the pipe burst wasn't the result of negligent actions. You and the owner of the unit are not responsible for the damage since the pipe burst originated within the boundaries of the 2nd floor unit. The 2nd floor unit owners are responsible for the damage per the circumstances you provided. Had the flooding originated in the common areas, the condo association is responsible for repairing the damage. Lastly, you are also not responsible for the above mentioned reasons. Please also note that casualty losses may be deductible as a Schedule A itemized deduction.