Clause 26 of the Articles of Agreement issued by the Royal Institute of the Architects of Ireland deals with responsibility for insuring existing structures where construction works involve alteration or extension of existing facilities. This clause provides that the employer bears the risk of loss or damage to existing structures and contents (owned by the Employer) caused by perils such as fire, storm, tempest or flood.
Given the rise in weather-related insurance claims at this time of year, it seems timely to consider what might constitute a “storm” or a “flood” for the purposes of Clause 26, as most insurance policies do not define such events. There is no Irish case on this point and as such, when seeking to define these risks for insurance purposes, we must look to UK case law for guidance.
According to UK case law, a storm involves violent wind and is usually accompanied by rain, hail or snow. A storm does not mean persistent bad weather, nor does it mean heavy rain or persistent rain by itself.
With respect to what constitutes a flood, there have been some contradictory judgments in the UK. In one UK decision, a flood was stated to be caused by a rapid accumulation or sudden release of water from an external source, which is not necessarily confined to the result of a natural phenomenon. However, in contrast to this, another UK decision determined that a flood is a natural phenomenon which has some element of violence, suddenness or largeness about it.
The leading authority in the UK on this topic states that it is a question of degree as to the size and character of the premises and while the ingress of water must be more than slow seepage or percolation, it can be a slow build up which eventually damages the property. There is no requirement for a flood to be violent or abnormal under this decision.
Employers should be aware of their insurance responsibilities when carrying out alterations or extensions to existing facilities. They should ensure that they are adequately covered against such risks as they have no right to recover any consequential loss from the Contractor.
Contributed by Fionnualla Cleary
