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  1. #1
    Join Date
    Oct 2007
    Posts
    3

    Default Owner's Liability Where a Climate-Controlled Storage Building Flooded

    I have filed suit in Small Claims Court to recover damages for property lost in the flooding of a climate-controlled storage building. The owner has retained the services of a lawyer, but I will be representing myself. I expect that the case will center on the rental agreement I originally signed and I would appreciate any opinions you might have on the merits of my case.

    The facts briefly stated involve a newly opened climate-controlled storage business and the slow-moving approach (600 miles inland) of the remnants of a Gulf hurricane. Residents and businesses in my area were warned in news reports 4-5 days in advance of the storm's arrival that there was a risk of flooding to low-lying areas should the storm stay on track. However the land elevation in my area varies greatly and the storage building was at least 150 yards from the nearest waterway and not in obvious danger.

    Unknown to me at the time I rented the unit and still unknown at the time of the storm’s approach was the fact that the building was indeed located within a FEMA identified 100-year flood plain. Also unknown was the fact that 4 days prior to the storm’s arrival, local firemen had distributed leaflets to businesses and residents in the area where the storage building was located reminding them that they were within the flood plain and that their property was at risk.

    There was no attempt made by the management of the storage business to pass along the warning that had been issued nor was any notice given at this time that the building was in a flood plain. Neither were there any measures taken by the owner to attempt to avoid potential damage by placing sandbags in front of doorways. In short, nothing was done and when the storm arrived the nearest waterway left its banks and four feet of water flooded the storage building.

    Occupants received their first phone call from management the morning after the flooding had taken place. It is my contention that the owner should have notified renters of the risk posed by the building's location in a flood plain before the storm arrived, or better yet at the time the rental agreement was originally signed.

    The owner was quoted in the newspaper as saying “they never expected the water to get so high”. I should have had the opportunity to make my own decision as to what was an acceptable risk, based on all of the facts available to the owner.

    The rental agreement consists of two pages detailing what the owner isn’t responsible for doing or providing. In particular it states:

    Occupant shall keep his property fully insured against casualty loss. Operator provides NO insurance of Occupant’s property stored in the leased space….Operator shall not be responsible for the theft or disappearance of Occupant’s property, nor in any manner for the safekeeping or the condition of the goods stored, nor for damages thereto caused by fire, water, freezing, heat, changes in temperature, humidity, dampness, leakage, rodents, insects, lightning, windstorm, hail, snow, flood, explosion, riot or civil disturbance, collapse of buildings, actions of other occupants, loss or failure of electricity, malicious destruction of third parties, or from any cause whatsoever of Operator or its agents. Occupant accepts the space in “as is “ condition. Occupant acknowledges that no heating cooling or moisture-control facilities are provided for non-climate controlled units.
    It is the last sentence on which I am hanging my hopes. I was indeed paying for a climate-controlled unit and he did have an obligation to provide “heating, cooling and moisture control”. Given that the owner had sufficient warning that he might not be able to provide these conditions in the event of the storm’s arrival, he had a duty as well as the opportunity to inform the renters of the risk to our property.

    After the flood I learned from long-time residents that this particular building had flooded before in the 1970s. Not being from the area, this wasn’t known by me or any of the other occupants with whom I spoke. It would have been known to the owner however, since he is a long established real estate broker and investor. The location of the building in a flood zone would have certainly come up in his purchase and financing of the building. Since the time of this flood, the owner has built an earthen levee around the perimeter of his building. Whether this would stop flood waters is doubtful but it does put renters on notice as to the risk.

    The owner chose to place a climate-controlled storage business in a 100-year flood plain and expects the renters to assume all of the risk for that decision. Does that paragraph in the rental agreement quoted above allow him to get away with it, or is he liable for the payment of damages for the destruction of my property?

  2. #2
    Join Date
    Oct 2007
    Posts
    3

    Default Re: Climate-Controlled Storage Building Flooded...Owner Liabilty

    If the location is required for a response, I am in North Carolina. If I have posted this to the wrong subforum, or if my question is entirely beyond the purpose of the forum, please move it or delete it entirely. Thanks.

  3. #3
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Climate-Controlled Storage Building Flooded...Owner Liabilty

    I can't find any controlling authority, and I don't subscribe to a N.C. research service, so I can't give you a definitive answer. I suspect that you're going to find that you're out of luck. The flooding was caused by an "Act of God", you were on clear notice of that you were responsible to insure yourself against flood damage, and there is no obvious public policy reason why a storage facility shouldn't be able to pass that responsibility on to a tenant.

    Within the context of the lease I would expect a court to conclude that "moisture control" doesn't relate to flooding, but relates to the appropriate use of a humidifier and/or dehumidifier to maintain an appropriate humidity level in the climate controlled unit.

  4. #4
    Join Date
    Oct 2007
    Posts
    3

    Default Re: Owner's Liability Where a Climate-Controlled Storage Building Flooded

    Thank you for the reply.

    My property actually was insured under my homeowner's policy, although I subsequently learned that I would have needed a specific flood insurance rider on my homeowner's policy for this damage to be covered.

    But can flood insurance be readily obtained on property lying in a “Special Flood Hazard Area” such as where this building is located? If I had purchased a flood insurance rider for my homeowner’s policy, would they have paid my claim upon learning that the storage building was in a FEMA "Special Flood Hazard Area", since I had not disclosed that fact before the damages occurred? How could I disclose the FEMA flood hazard designation if it hadn’t been disclosed to me?

    I don’t know the answers to these questions, but I think they support the contention that disclosure of the property’s flood history was required for me to willfully consent to entering a rental agreement with this business or even to obtain the proper insurance for my property.

    And it’s not the responsibility for insurance being passed on to the tenant with which I take issue. It’s the responsibility for the owner’s bad business decision being passed on that is the problem.

    Climate-controlled storage facilities cost the most per square foot to rent and attract peoples’ most valuable belongings. It’s reasonable to expect that the owner of such a business wouldn’t choose a location where that property is at greater risk statistically for being lost or damaged.

    I suspect that this owner bought the property at a discount because of its flood history, and then rolled the dice that it wouldn’t flood again while he owned it. He didn’t disclose the flood history in the rental agreement because that might cost him tenants. He didn’t call to warn tenants in the 4 days it took this “Act of God” to arrive, because once again it might cost him tenants. He risked the property of others for his own personal gain and surely there is a duty that was violated somewhere in all of that.

    I saw people lose generations worth of belongings in this flooded building for want of this business owner simply picking up the telephone and alerting his tenants to the danger. I’m fully prepared for the law not working in my favor, but some things are just worth doing on principle.

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