Help! Burst pipe and tenant DEMAND reimbursement

34 Replies

Hi BP members, We had 2nd floor tenants went on vacation and they turned off their heat for one month, so this Monday the water pipe busted. The water gushed in into the hallway and basement. 30min later, another water pipe bursted on 2nd fl bathroom, the water was then streaming from the ceiling going down to the 1st floor another tenant’s bedroom( we caught right away and used the bucket to catch the water) which affected 1st floor tenant. We got emergency plumber came in within 2 hours and fixed the problem. Now the 1st floor tenant DEMANDED the reimbursement on her mattress topper, tempurpedic bed, bedsheets, and rug to be professionally cleaned ( her rug didn’t get wet but she said it was). She also demanded rent compensation since she couldn’t sleep in her bedroom. She then slept on the futon in the living room for a few days. We were sorry about what happened and disappointed and we, the landlord, are the victims as well. It all started from the 2nd floor tenants’s neglects. How do we respond to this? Do we just pay any amount she asked for? Can any experienced landlords help? Thank you all very much!

Regretfully, I've been involved in an overhead, multi-tenanted burst pipe & flood situation as well.   You have my sympathy.  If your situation is like mine, someone soon will be calling MOLD! whether or not that cry is founded.  I would recommend getting a disaster/remediation specialist in there as quickly as you can to put ALL of your tenants at ease.  

As far as the demand goes, you can see this one of two ways: 1) If you like this tenant, generally, then I would do everything in my power to keep her and keep her happy. Your future reputation will thank you.   If on the other hand, she's an imp, then this is your chance to get rid of her.  Hold out, say "no" and offer her a one-time-only chance to vacate her lease and the premises.   Don't be surprised if she asks for relocation fees.  if you have enough problems with her... well, let's put it this way: is it better to pay her to get out-- C4K style,  or to repeatedly hire mold specialists for the next 18 months every time she gets a common cold?   Your call.  

As far as Liability on your upstairs tenant is concerned, I'd refer to your Lease itself, and area attorneys to help you.  There are WAY too many variables, up to and including what you "Should have known"; area rental/heat law, etc.  I would honestly recommend consulting an attorney-- NOT to sue/recover, but first to see if you even have a case.  

Again, sorry you're going through this.  Good Luck. 

@Steve McGovern thank you for your advise. She and her friend only moved in for 5 weeks so far and their lease will end this 5/31. Since they moved in, we already spent 3-time money on fixing the toilets/shower drain because the drainage issue (found lots of toilets, flushable wipes, hair, feminine products, tree roots etc) at this point, we are happy if she can just move out. This is only 2 unit family, 1st and 2nd floor. How much should we reimburse her mattress, should we set the limit; otherwise she can ask for $2000 or whatever...

This is why tenants should have renter's insurance. It's not your fault, therefore you have no liability. If they want reimbursement, tell them to talk to the tenant upstairs that caused the problem through neglect.

FYI: my lease includes a clause that tenants are responsible for damages caused by abuse or neglect. You should consider adding that to your lease.

@Nathan G. Thanks for your advise. You are right. It is really not our fault. We will have to deal with the 2nd floor tenant when the return from their vacation. We have that clause clearly written on our lease. However, we took upon ourselves and told the 1st floor tenant we will reimburse her mattress and carpet to be professionally cleaned etc so that she can order ASAP. Otherwise she was crying that she was sleeping in the living room. Note. I was there when that happened. The old mattress was only wet for a few minutes before we caught it. Such a big headache with this tenant!!!

Do NOT pay them anything. You know the old saying, If You Give a Mouse a Cookie he'll ask for a glass of milk .  Don't give them anything because they'll just keep asking for more and it's totally not your fault and you are not liable this is what renters insurance is for !

@Russ Draper thanks for your advice! I know but it will become a battle everyday... we should offer her the compensation of the mattress and carpet cleaned( hopefully not partial rent that she was demanding for) then we will get some recoup back from the 2nd floor tenants (they all have renter’s insurance.) We were also thinking to offer her to move out if we mutually agree to terminate the contract.

Common sense is not common.  Spell out tenant responsibilities in the lease..... as an example, here are some important clauses from ours which would serve you well in this type of situation.

DAMAGES. Tenant agrees to pay for repairs of all damages that they or their guests have caused. Landlord agrees to initiate repairs in a timely manner following discovery of the damage or can choose to defer repair until Tenant has vacated the premises. Repairs done by a professional will be billed at the professional rate. Repairs done by Landlord will be billed by the job or as labor plus materials.

LIABILITY FOR PERSONAL PROPERTY.Tenant assumes risk for all personal property kept on the premises. Tenant further agrees not to hold Landlord liable in any manner for or on account of any loss or damage sustained by action of any third party, fire, water, theft, or the elements.If a Tenant decides to store personal belongings in a storage shed provided by Landlord, he/she does so at their own risk.

INSURANCE. Landlord maintains insurance that covers Landlord’s building, possessions, and liability, but does not cover Tenant’s liability and possessions against loss, theft or damage. Tenant agrees to obtain and maintain Renters Insurance to cover their belongings and liability in the event Tenant or their invitees cause damage to the property of others.Tenant agrees to provide Landlord with proof that such policy is in force and to list Landlord as an additional interest for notification purposes on the Renters Insurance policy.

WINTERIZING. Tenant agrees to maintain the indoor temperature at no less than 50 degrees fahrenheit. Tenant agrees to take due precaution against freezing water or waste pipes and stoppage of same in and about said premises.This includes, but is not limited to disconnecting all garden hoses from outdoor faucets prior to freezing weather and opening cabinets under fixtures that are adjacent to outside walls to allow warm air circulation near water and waste pipes.If water or waste pipes are frozen Tenant will notify Landlord immediately and in writing.If Tenant did not take due precaution to prevent the freezing and/or fails to notify Landlord of a problem in a timely manner, Tenant will be held liable for all damage caused thereby.

Is this a situation where insurance companies would subrogate?  That is, @Peace Lily you file a claim with your land lord insurance and then they turn around and go after the upper tenants renters insurance company.  Same for the first floor tenant.  They file a claim with their renters insurance company and they go after the upstairs tenants.  Or, if the upstairs tenants don't have renters insurance, would the insurance companies sue them?

@Peace Lily  

Don't listen to anyone of the comments above. We are all landlords and this is the cost of doing business. These are items you need to prepare for. To the person who said make the 2nd floor tenant pay for it, I respectively say they have no idea what they are talking about. You cannot blame a tenant for turning off their heat, especially if they pay the utilities. If tenants are paying their own utilities, they will turn off the AC if they won't be there. Period. You should require all your tenants to carry insurance and you should have insurance to cover this. Go to your insurance first. You need to provide enough compensation to make the tenant on the first floor whole and not a penny more. The insurance for both parties is supposed to handle these type of claims. The adjuster would come out and make and estimate and submit the claim. Neither you nor the tenant determines the cost of the damage. The insurance adjuster does.

Assuming they have insurance you pay nothing in compensation. If they do not have insurance too bad for them since it is definatly not your fault or responsibility. You need to be going after the tenant responsible to pay for all damage repairs due to their negligence in turning off their heat.

Not sure about others but I sure as hell don't turn off the heat in my home when I go away and I also pay for all my own utilities. Hold them responsible for all damage including the down stairs tenant.

Rescind your offer to pay the down stairs tenant and tell them you are working toward having the upstairs tenant held responsible.

In the future never make promises to tenants to pay anything until you have exhausted all other options. Always use insurance as a stall tactic and make them wait.

@Marcia Maynard Thank you very much for your advice.  We have those clauses in a simple phrase eg. It is required to maintain the temperature at 50 degrees Fahrenheit at all times.  I like yours which describes very through and in detail.  We will definitely add those on our lease next time.  Now we just have to get through the 1st floor tenants' complaints. We do feel that we we will compensate them for the mattress and rug cleaned and just get this over with it. Then, we will have 2nd floor tenants to pay for this damage when they return from their vacation.          

I agree with Jimmy Klein. as a landlord I haven't had this issue. but as a commercial hvac contractor I have had issues with pipes bursting etc. you don't offer the tenant anything. immediately file a claim with your insurance company. hire a remediation crew to clean. up any if the water/ damage that occurred. Let the insurance company handle the rest. they will assess damage and might even sue the 2nd floor tenant.
Originally posted by @Jimmy Klein :

@Peace Lily  

Don't listen to anyone of the comments above. We are all landlords and this is the cost of doing business. These are items you need to prepare for. To the person who said make the 2nd floor tenant pay for it, I respectively say they have no idea what they are talking about. You cannot blame a tenant for turning off their heat, especially if they pay the utilities. If tenants are paying their own utilities, they will turn off the AC if they won't be there. Period. You should require all your tenants to carry insurance and you should have insurance to cover this. Go to your insurance first. You need to provide enough compensation to make the tenant on the first floor whole and not a penny more. The insurance for both parties is supposed to handle these type of claims. The adjuster would come out and make and estimate and submit the claim. Neither you nor the tenant determines the cost of the damage. The insurance adjuster does.

 Any lease worth its weight will have a clause stating that safe temperatures must be maintained at all times to avoid freezing pipes. What planet do you live on that its common practice to completely turn off heat in the winter? This is clearly a display of neglect and a violation of lease terms by the 2nd floor tenant, assuming this is in your lease. Even if it is not in the lease, there is probably a halfway decent argument for negligence, as most people know not to turn off heat in winter.

@Thomas S. Thanks for your advice. Both floor tenants have rental insurances.  As much as I agreed with your point about not offering the compensation to downstairs tenants, we already did which we just wanted this to go back to normal.  We can hopefully recoup some expenses from upstairs tenants. That will be another fight after then return from their vacation.  We cannot make the downstairs tenants wait because she is sleeping on the futon in the living room. The longer we wait, the longer she will blame us. We just have to end this...    

@Peace Lily my lease has a minimum heat temperature and maximum AC temperature specifically listed during occupancy. My lease also states when leaving the property vacant that heat and cooling must be left on at that same temperature. Additionally vacating for more than 3 days, that they must have someone checking on the property. I even offer to check for them, so they have no excuse. My lease also states tenant is responsible for any damage caused by their negligence and specifically stating it includes burst pipes due to low temperature. It also covers feminine products, paper towels, etc in the drains.

If I was the first floor tenant, I would expect you to make this right too. It is not an act of God, it is an act of negligence that you should mitigate by having responsible tenants and proper lease protections in place. 

You selected the tenants. You set the rules in your lease. Trying to pretend like you are just a victim here isn't how it works. You reimburse floor one. Then you collect the money from floor two for their negligence. 

The businessperson in me sympathizes with the desire to negotiate with the tenant and shift blame to upstairs tenant.

The lawyer in me reminds everyone here that landlords have certain statutory and common law duties to provide habitable premises. NY law is not my thing, but a NY real estate lawyer would be able to run these down for you no problem.

You did the right thing by acting immediately, of course, and in the end you probably have a claim against the upstairs tenant (for breaking lease terms), for most if not all of what you would owe the downstairs tenant. But your responsibility to downstairs tenant doesn’t go away just because the pipes burst in another unit. You should be making sure you are dealing with both issues in tandem, or you might risk losing the rights to pursue remedies.

@Andrew Syrios  Thanks for your advice.  I agree. We have the clause on our lease: It is required to maintain the temperature at 50 degrees Fahrenheit at all times.

@Jimmy Klein  Thanks for your advice.  We will provide some compensation for downstairs tenants and hope to get some recoup from upstairs tenants. But I have to agree with some other landlords about following the temperature requirements clearly written on the lease. Upstairs tenants clearly neglected this point.  

@Moshe Aharoni Thanks for your advice. I agree with some of your points, but we don't like to have any law suit going on... We just want to keep the matter as simple as possible. What we are looking at is it seems that only upstairs tenants need to go through their Renter's Insurance if they decide to since they have to pay for some damages they caused (they may choose not to depending on their deductible etc.)  As to downstairs tenants, they don't seem to go through their Renter's Insurance since their are not the ones who caused this incident.     

This is a prime example where your insurance would come in to play.  Like a few comments above, do not pay anything to anyone, let the claims adjusters handle the damages.  Obviously this is why the tenants should have their own tenant insurance.  First floor tenant should put a claim through her own tenant policy for the damage to contents... which is the reason she would have purchased the tenant insurance in the first place.  To protect against any sudden or accidental damage caused by the perils outlined in the policy wording (including water escape).   Generally the tenant would have a deductible to pay but if their insurance company is successful in subrogating against the 2nd floor tenant (or their insurance company) they will have the deductible returned.  Paying out to the first floor tenant could be seen as an admission of guilt which your insurance company would not want you to do.    

Call your insurance company to obtain their professional advice on how to move forward. 

Originally posted by @Jon Holdman :

Is this a situation where insurance companies would subrogate?  That is, @Peace Lily you file a claim with your land lord insurance and then they turn around and go after the upper tenants renters insurance company.  Same for the first floor tenant.  They file a claim with their renters insurance company and they go after the upstairs tenants.  Or, if the upstairs tenants don't have renters insurance, would the insurance companies sue them?

Yes, that seems correct. I believe the insurance companies would sort this out. Fortunately for the landlord, both tenants do carry renters insurance. However, the damage to the premises affects all three parties.... building/fixtures of the landlord and belongings of the tenants. First thing is to mitigate the damages, file a claim and start clean up and repair of the premises. Emergency entry into the apartment of the upstairs tenant would be warranted in this situation and that tenant should be notified, even though they are out of town. Also, it would be good to take a photo of the thermostat setting of the upstairs tenant. You will need to find the root cause for this damage and date of occurrence. Is it possible it was a malfunction of the thermostat/heating system or did the upstairs tenant really turn the temperature down so low that the pipes froze? Did a plumber confirm that it was frozen pipes (when thawing) that burst, or could it have been a plumbing failure? Before I started a conversation with the tenants about liability, I would make sure I knew for a fact that my own building systems weren't part of the problem. That's why inspections by qualified professionals are important in matters such as these.

Everyone sends to the insurance-and deal with it that way. @Jimmy Klein I disagree you can and should blame a tenant who turns off the heat in winter in the northeast. Any landlord in an area with freezing temperatures should have a heat clause in thier lease. Lack of habitability due to tenant negligence is not a landlords fault, it is on the tenant who turned off the heat. The landlord is possibly going to have to absorb the cost yes, but to say it is not just the cost of doing business implies he should just pay and move on. There are 3 insurance companies and a tenant who should pay first.

@Marcia Maynard It was not a malfunction of the thermostat/heating system. When we were called about this incident, I called our handyman management right away then he arrived then shut off the main vault so water stopped gushing into the basement and the hall way. Then we walked around the upstairs and downstairs and immediately checked the thermostat. Upstairs There are 2 thermostats (one to control back of the apartment -- it showed 53F; one to control the front of the apartment - bedroom and bathroom - it showed OFF!!! That is how we identified the problem. We bought this well maintained house 6 months ago and had inspector check everything and it was all good. Yes, the plumber confirmed it was frozen pipes... 

@Tim Joyce Thanks for your advice.  The property is in CT.  That is what we will be doing. We will compensate downstairs tenants for her mattress although she was asking a few more items to be replaced (we don't know the price she had in mind yet). We wanted to see the number first before agreeing.  We will then address this incident caused by upstairs tenants and prepare a list of cost involved in this incident and let them know due to their negligence.     

Never considered a "min/max temp" clause in a lease. Now I will. What idiots (the tenants). I had some tenants that would leave the windows open all summer, never turning the A/C on, and let it rain inside. Ridiculous.

I agree with @Joe Splitrock .  This is 100% your responsibility to make this right with the tenant. You are a landlord, you are a business owner.  You are providing a product to a customer, and that customer has had a very negative experience with your product. As the business owner it is your job to provide a good product, and good customer service when that product doesnt live up to expectations, or that product damages their property.  

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