Inspection Responsibility of Property mgt Co?

I live in a small - 3 story/17 unit condo building in California. All our units have balconies visible from the outside. Our property mgt company conducts physical inspections of the property on a quarterly basis as part of their duties. Their reports include minor observations that I have often questioned as worth while (e.g., are we getting our moneys worth with these inspections that turn out such trivial observations) as light bulbs out in the stairwell, people not picking up after their dog in the back yard, an extra storage locker in the garage. We have recently encountered a significant problem with water leaks from our new roof, onto the balconies and then not draining properly because several several of our balconies have material (outdoor carpet, tiling etc.) on top of the cement that is trapping the water and creating accumulated moisture, lack of drainage, mold, rotted balconies etc. In sum, we are now facing a huge assessment of over $150,000 (twice our annual operating budget0 to remedy the situation. Much of this problem could have been prevented had the owners known that it is prohibited to have any kind of material on top of the balcony.

Should our property mgt company have been aware of this issue (now that we are learning about it, we have realized how common this issue is and how people in the business are all aware that you can not put material on top of cement on balconies) and/or either inspected for this or simply noted this in their property inspection reports? Thanks!

Thanks Paul - appreciate the response. The HOA is responsible for architectural standards and tiling your patio is not allowed. For the unit that has a patio that is fully tiled, would the owners (prior owners) be liable for that portion of the expense? The current owner of the unit that has the tiled patio is not the owner that installed the tile. Would the HOA have a legal right to go after the prior owners who installed the tile (assuming the HOA did not give permission). This is a huge expense and I don't feel it should be equally divided among the owners if a few owners contributed to the majority of expense.

Our balconies are exclusive use common areas and our CC&Rs prohibit installing indoor-outdoor carpeting or any other materials over the original tile.

It does sound like your docs forbid that too?? Ours also state that nothing may interfere with proper drainage. If damage occurs, the owner is responsible not only for their own damage but also any damage they cause to the common areas or other units. In our case, the tiled balcony (over cement) unit owner would be responsible. If they haven't owned it too long, they may have recourse against the prior owner. But the current owner should have read your governing docs and should have learned that the tile wasn't permitted.

Now, are Owners who have not created any problems going to have to share in footing the bill for repairs? It's time your board hire an HOA attorney for this situation.

With Paul, I don't think the PM is responsible, but that may depend on what's in the contract with the PM/MC.

Finally, are you certain that the new roof is OK and its own structure hasn't created or exacerbated these problems?

After all the smoke and gunfire settles it might be a good idea to write up and implement a pro-active "private area" or "deck inspection" procedure. Unfortunately, I think many of these kinds of problems only surface "after the fact". I think trying to go after the previous owner would be like trying to get the new owner of a used car sale to be responsible for the old owner's unpaid speeding tickets.

I think the title companies are supposed to include copies of all the governing documents in the signature package, acknowledging that the new owner has read and understands everything? Dream on. :-)

Paul T

Thanks Larry. Here is the part of the inspection report regarding the balcony. "The balcony deck is not original. Ceramic tile was installed prior to the current owner. It is not visually apparent if this tile was installed over the original water proofing finish (possibly a Dex-O-Tex material which was commonly used when the building was
constructed) or if the waterproof finish was removed and then the ceramic tile installed on the wood floor sheathing. Ceramic tile base was installed under the stucco screed at the base of the stucco walls (photos 2 – C, D). If these are weep screeds, then this would not allow water and moisture to drain out of the stucco as was originally designed and
constructed."

Sam,

Thanks for the reply. It's a bit more clear now. It sounds like your balconies are wood-frame construction with stucco-covered walls. The owner(s) altered the original drainage and who knows how much water has seeped into the wood structure under the stucco.

About twenty years ago stucco problems began to emerge in the Phoenix area when some new products hit the market that required new installation techniques. Contractors kept using the old methods to install the new stuff and the result was tons of water flowing between the stucco and the wall sheathing. I hope you are not having similar problems.

Your original question was whether the management company should be held liable for failing to detect the drainage problem on the balconies. My opinion is probably no. I doubt that your management company ever claimed to be qualified to conduct home inspections and/or structural analysis. In my state, a person must be licensed to conduct a home (residential) inspection. I do not know if a home inspector's license would allow the person to inspect a multi-story condo building; a structural engineer would be more likely to do an inspection of such a building.

If covering the balconies with carpet or tile was an obvious violation, it seems the other residents, officers, and board members should have noticed the problem. If these problems were not visible from common areas then I do not see how the management company could be faulted for failing to detect the problems.

Thanks Steve. To answer your questions... yes, putting material (tile or outside carpet) on top of our original balconies is prohibited in our CC&Rs. And yes - these same balconies are visible to the outside... i.e., when the property mgt company does their external inspection of the building, they should be able to see the balconies on the first 2 floors (the top floor may be harder to see). Thanks.