Many of you have probably read or heard about the tragic accident in Berkeley, California, where a residential balcony collapsed killing six students. http://www.cnn.com/2015/06/23/us/berkeley-balcony-collapse-dry-rot/. According to reports, the balcony collapsed due to beams that were "extensively rotted" and balconies that exhibited "significant rot and decay." We have encountered many clients and potential clients whose decks and buildings exhibit similar rot. Fortunately, accidents such as the one in Berkley are not frequent, but they do present a significant risk to homeowners and homeowners associations. It is often the case that associations are responsible to maintain decks and balconies as limited common elements. If they are not properly maintained, a maintenance obligation can quickly become a significant liability concern for the association. If an association discovers rot in its buildings, it has several options. If the association is within the applicable statute of limitations, it may have a claim against the builder and/or its subcontractors. For older projects outside of the statute of limitations, the options are more limited. Homeowners associations can assess the owners or possibly secure a bank loan. Neither of these options are particularly popular. Another possibility is to pursue the first-part property insurance procured to cover the association's property. Many of these policies provide coverage for "collapse." Fortunately, associations may not have to wait until an actual collapse such as the one in Berkley to secure coverage. In Queen Anne Park Homeowners Association v. State Farm Fire and Casualty Company, the Washington Supreme Court recently confirmed that when insurers do not specifically define collapse, the term is interpreted to mean "substantial impairment of structural integrity." Translating that into English, the court ruled that a building (or parts of a building) do not actually have to fall down in order to be covered as a "collapse." Associations should be mindful of their maintenance obligations. If rot or damage is discovered, associations should act quickly to protect the safety of its residents and to avoid a significant liability risk to the association. If an association discovers rot or decay, Barker Martin is happy to provide a free consultation to ensure the association knows all of its options. read more