Insurance companies can be allies in the fight for life/safety compliance. They have considerable power over property. If persons insured by the companies don’t live up to the standards of the policy, they may lose their insurance benefits. A judge in Massachusetts has ruled that an insurance company does not have to pay for a fire that occurred at a restaurant because the owner did not properly maintain a fire suppression system. The Insurance Journal reports:
At issue is an exclusion in a commercial lines policy issued to the French King restaurant in Erving, which required the restaurant owner to maintain a fire suppression system. The insurer — Interstate Fire & Casualty Co., a subsidiary of Fireman’s Fund — claimed that the fire-suppression system installed at the restaurant was obsolete, and therefore triggered the exclusion and did not require them to indemnify the restaurant.
The court agreed and ordered the restaurant to pay back the $15,000 advance given to the owner before the investigation was completed. I’ve always wished there was a separate registry of properties and their insurance companies so inspectors could alert the insurance company about dangerous conditions. (I make no comment as to whether this might violate privacy laws in some states). Most owners will act so they don’t lose their insurance unlike the owner in this case. The article said that the owner could have upgraded his system for $3,250. Unfortunately, fire inspectors have to repeatedly try and obtain compliance because of the real threat of fire while some owners only see the extra cost to themselves when asked to comply.
I recently completed a 2 month period of travel all over the Midwest doing trainings for building officials, fire inspectors, property maintenance and housing inspectors and law enforcement officers in Columbus, Ohio, East Liberty, Iowa, South Bend, Indiana, Troy, Michigan, East Peoria, IL and Sheboygan, Wisconsin. All of them are facing challenges because of the foreclosure crisis and are trying to respond with reduced resources. I want to say how much I appreciate the hospitality I received wherever I went and the enthusiasm of the participants. It gives me great hope when I see the number of inspectors who take the time to come to the classes I teach so they can enhance their skills and keep trying to improve their communities. At a time when so many public employees are feeling unappreciated and under attack, I just wanted to extend my thanks to everyone who made my trainings a rewarding experience.
It’s not unusual for one agency to stumble upon evidence that would interest another department in the local jurisdiction. Firefighters in Columbia, Pennsylvania recently found a marijuana growing operation when they responded to a fire. Police investigated and found plants growing and bags of weed. The police have to be careful before they enter a building though. Unless it’s an emergency (and the destruction of drugs is not usually considered to be one), the police cannot enter a building without consent from the owner or occupant or without a search warrant. Just because an inspector has a right to be on the premises, doesn’t mean personnel from another agency can join him or her. The information uncovered by an inspector can be communicated to the police and used as the basis for a criminal search warrant.
One of the most difficult situations I deal with as a prosecutor is trying to find someone to take responsibility for a property where it is in foreclosure, the owners have abandoned the building and the lender fails or refuses to complete the foreclosure process. Some nonprofit organizations are stepping in under those circumstances and using state laws on abandoned properties to take them over, fix them up and then sell them. One such organization is featured in an article in the Huffington Post. Unfortunately, in some states, the waiting period for action is lengthy. While the clock is running, the property continues to deteriorate. It is shocking to me that legislatures fail to address the problems these derelict properties create for communities and local government. Far too often state law protects lenders from having to take possession of these properties and maintain them prior to the foreclosure judgment even though the owners are no longer around and the mortgage document gives the lender the right to ask for possession. These nonprofits that take on this difficult task should be applauded for their efforts but there aren’t enough of them to make a dent in this horrendous problem.
I was recently contacted by someone who is gathering data on the housing market with a special interest in the health of condominium associations. He was concerned that many of them, especially those that are recent conversions, are struggling financially as more and more units are subject to foreclosure. This raises problems for inspectors. If an association falls apart. who is responsible for common area problems? I’ve had this situation happen a number of times, especially with fire code problems and building code violations. The first question that needs to be answered is how is title held regarding the common area in a condominium development? In some developments the title is held by the condo association but in others, each unit owner owns an undivided share of the common area. After that question is answered, the next one is: what does the declaration of condominium say about who or what is responsible for the upkeep and repair of the common area? Typically the association is responsible. If the association owns the common area and is responsible for its upkeep, the answer is easy. I tell the inspector to notify and cite the association if necessary. I’ve known some jurisdictions that have even helped associations get reinstated that had lapsed. However, if the common area is owned by the individual unit owners, it gets trickier. If the association is responsible for the upkeep under the declaration, then it is in control of the property and is considered an “owner” under the IPMC. However, if the association doesn’t exist, who does the inspector pursue? In that case, all of the owners are responsible and should be notified and cited if necessary. This can be a huge undertaking in a large condo complex. Sometimes following this procedure stirs up the unit owners enough to form a working condo association. It’s far easier dealing with one entity than multiple owners and the local jurisdiction should encourage the owners to follow the condominium declaration and form a viable association.
