Methamphetamine Contamination Update: Avoiding Nightmare Landlord Scenarios.
Sudden vs. Gradual Damage:
You may have seen a recent episode on Fair Go, referring to a property contaminated with methamphetamine at use levels. The landlords did everything required of them under the contract, including regular checks and sufficient vetting of the tenant.
Regardless, the property was indeed contaminated and required detailed testing and methamphetamine decontamination. Unfortunately this comes at a cost, a cost that a landlord would expect to be covered for if they are paying premium landlord’s insurance or something similar. There is a directive within some realms of the insurance industry that a constant level of contamination spread throughout the house means that the damage is gradual rather than sudden. This is an unfortunate scenario where the landlord is left to pick up the tab if they are only covered for sudden (and not gradual) damage.
Some insurers are choosing to waive their right to deny cover and others are being more hard-nosed so it is a moving target for a landlord trying to avoid meth contamination. As a prudent landlord you should have your broker or lawyer check your insurance policy to check what scenario you are covered for (i.e. if someone you know causes the contamination are you covered? If it is just use levels are you covered? If you cannot prove that the damage was sudden are you covered?). This may especially be the case if you have a policy that is old or dated or has not been renewed in a while. You may end up in a scenario where regardless if you uphold your side of the insurance obligation and have the highest cover possible, you have to pick up the tab for the meth decontamination or meth clean.
Meth Cleaning Companies are not cheap because in most scenarios they need to guarantee that the levels will be decreased below the standards (most Meth Decontamination Companies should do this). Otherwise the Meth Cleaning Company will be at liberty to charge the landlord without a clawback in the event that the contaminant is not eradicated below the levels. An alternative if insurance will not cover you is approaching your bank (some will allow 90% leverage) in order to fund the decontamination so that the property will get itself to insurable levels. It is important for a prudent landlord to decontaminate the property so that the property will be insurable, and also so that you will have a solid paper trail in the event of sale for scrutiny.
Painting your house between tenancies
We are finding that people who paint their property in between tenancies prior to checking for meth contamination are opening themselves up to further pain. In the hypothetical scenario where your tenant has created meth contamination through use or manufacture, a coat of paint may make the property look far more appealing, however it will partially encapsulate the contamination, which is unfortunate for two reasons. Firstly, the meth cleaning process will require a degradation of the paint in order to be affective. Secondly, the encapsulation makes it unclear what the levels actually are, so both the meth tester and the meth cleaning company are in the dark prior to undertaking sub-surface testing.