12/14/2020 – The tap water insurance for an apartment house stipulated that all pipes should be turned off if the house is left for more than 72 hours. After a water damage, the homeowners requested an insurance benefit. The Supreme Court made it clear: If the damage occurred within the first 72 hours, the exclusion of benefits only applies to that part of the damage that happened afterwards. Because there were no findings on this, the first court has to deal with the case again.
There was tap water insurance for an apartment building between the plaintiffs and the defendant insurer. The contract included duties of care in order to avert any damage. The intervener who handles the entire rental did not know them.
She was not involved in the conclusion of the insurance contract and was never asked to handle it. She was never informed of the contract or instructed to comply with the duties of care.
One of these would have been to shut off all water pipes if everyone left the house for more than 72 hours. A breach of these obligations due to damage caused by intent or gross negligence would release the insurer from the obligation to cover.
Ignorance leads to harm
The plaintiffs themselves stay in Israel most of the time. Meanwhile, the intervener and her husband take care of the house. In addition to the tourist rental, they are also responsible for preparation and follow-up.
Cleaning was planned for December 9, 2017. Two days before the intervener went to the house and turned on the central water connection and boiler, among other things. The cleaning was not carried out. On December 10th, a neighbor noticed water damage and reported it.
The cause was an incorrectly laid pipe that had not been noticed before. A leakage of tap water caused massive moisture damage to the building and inventory. When he was noticed, no one had been in the house for about 75 hours.
Complainant’s jurisdiction
The homeowners demand around 50,000 euros from the insurance company. The damage occurred within the first 72 hours, which means that the breach of obligation is not causal. The behavior of the intervener cannot be attributed to them either.
The insurer requested that the action be dismissed. In any case, the intention was that the building would not be entered for more than 72 hours. The plaintiffs must ensure that due diligence is followed in their absence, so the violation is attributable to them.
This is precisely why the first court dismissed the petition for action: the plaintiffs would not have ensured that the water pipes are shut off if the house is empty for more than 72 hours. The court of appeal ruled that the claim was basically justified.
The behavior of the intervener is in any case attributable to the plaintiffs, because the opening and closing of the water valves falls within their area of responsibility. The cleaning would have taken place on December 11th, which meant that the house was only empty for one day, which was only slight negligence.
Gross negligence not proven
The defendant insurer filed an ordinary appeal against this judgment highest court a.
The obligation to shut off all water supply lines for 72 hours when leaving the house is a preventive obligation, according to the Supreme Court. When the contract was concluded, it was already clear that the house would not be inhabited continuously, but would be rented out to tourists.
Since ambiguities in the execution of the contract are generally at the expense of the party from whom the contract documents originate, it is up to the insurer to prove that the obligation has been breached. According to findings, the property was actually vacant for more than 72 hours.
However, the insurer is unable to prove the plaintiffs’ gross negligence. They would not have hired a third party to fulfill the obligation, but the findings would not be sufficient to assess whether there was gross negligence.
The question of causality
Even in the case of gross negligence, the causality should still be checked. The obligation to perform remains in place if the breach of the obligation has no influence on the occurrence of the damage event or if it has no influence on the extent of the compensation.
If a breach of obligation is not causal for the occurrence of the insured event, but only for the scope of the insurance benefit, the insurer will only be exempt from payment to that extent; the principle of causal reduction in benefits applies.
Basically, it was not the wrongly laid pipe, but the failure to shut off the water pipe, which was the causal factor for the damage, according to the Supreme Court. However, the insurer accepts in its conditions that the house will not be inhabited for up to 72 hours and that there is no supervision.
There are no findings
If the insured event occurred within the first 72 hours, the breach of obligation would not be causal for the occurrence of the insured event, but only for the scope of the insurance benefit to the extent of the damage that occurred afterwards.
If, however, the water ingress did not occur until after 72 hours had elapsed, the breach of obligation would actually be causal for the occurrence of the insured event and the insurer would be completely exempt from payment.
The insurer’s revision thus proved permissible and justified. Since the necessary findings on gross negligence and causality were missing, the Supreme Court overturned the judgment and referred the case back to the first instance.
The decision in full text
The Supreme Court decision 7Ob104 / 20z dated October 21, 2020 is available in full in the federal legal information system.
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