How to Successfully Subrogate Building Envelope Failure Losses
February 3, 2015
Most Common Failures
In Canada, insurance records clearly show that Canadian claims and associated payouts due to building envelope failures far exceed those associated with structural failures. The most commonly reported building envelope losses can be classified as induced by moisture, wind, or movement. While these failures often originate as a result of natural forces, the root cause is most likely attributed to incorrect detailing, inferior products used in construction, poor workmanship, or a combination thereof.
Rainfall or melted snow may penetrate a building envelope when the building is not appropriately detailed to prevent water infiltration. Another form of moisture-induced failure is the condensation of warm air, which cools as it moves from the heated indoors to the cold outdoor environment through the building envelope system. I once investigated a large loss that sustained extensive water damage by one of the American Airlines buildings in the Kansas City airport. The flat concrete roof of this building was protected against water by a closed-cell foam membrane. Unfortunately, the improper application of the foam resulted in the development of small air pockets between the membrane and the roof. Due to repeated hot and cold temperature cycles, what began as small pockets mushroomed into large balloons of air which eventually burst, allowing rain water to accumulate on top of the roof and seep below into the exterior walls. The resulting damage to the building was extensive and extremely costly to repair. Fortunately, we were able to assist the insurer in documenting the cause of the loss so that they could have the necessary tools to effectively pursue subrogation.
Poorly constructed buildings can be compromised by wind damage. Once the building envelope loses structural integrity, rain and other natural elements can open the structure to further damage. A famous example of serious building envelope failures due to wind pressure is the curtain walls falling off the façade of many high rise buildings in downtown Toronto. Although strong wind pressures (suction), assisted by internal gusts from HVAC systems start up were the forces at play in this case, the underlying cause of failure was the structural sealant used to secure the curtain walls. As it aged and underwent repeated thermal cycles, the structural sealant hardened and, in the absence of mechanical ties, inevitably provoked failure of the curtain walls. In this case, the supplier of the structural sealant is most likely liable.
We may not realize it, but structures move all the time. Well-designed buildings accommodate movement and sustain no damage. However, a poorly designed structure or an inappropriate type of foundation can result in excessive movements of the building, which causes extensive damage to its envelope. For instance, if the shortening of columns and deflection of slabs and/or beams are not properly accounted for in the design and construction of horizontal movement joints, one should not be surprised to see bulged out or even partially collapsed masonry veneers or cracked windows. In cases like these, the responsibility may lie with either the designer or the contractor, or both.
The Onset Of Deterioration
Once any of the failures discussed above have occurred, deterioration of the building envelope is almost immediate. Three types of deterioration mechanisms can be directly tied to any of the types of failure described above: chemical, biological, and mechanical mechanisms.
Chemical Deterioration Mechanisms
Chemical deterioration is the degradation of the building envelope due to chemical interactions. Familiar examples of chemical deterioration include corrosion of the steel framing and white staining on the surface of masonry veneers (efflorescence).
Biological Deterioration Mechanisms
While most forms of biological degradation are caused by moisture, insects such as termites, beetles, carpenter ants and others can also penetrate the building envelope and create their own brand of destruction, including rot, mildew, mould, and fungus.
Mechanical Deterioration Mechanisms
Building envelopes can be damaged through weatherrelated mechanical forces. Examples of such mechanisms include freeze-thaw, shrinkage-expansion, fatigue, and impact; all of which create higher stresses than the material strength. While these particular forms of deterioration are not always caused by the causes outlined above, they are almost always aggravated by them. Moisture in particular can be a significant contributory cause.
Overall, poor workmanship is often the root cause of construction defects, including those which have an impact upon the building envelope. Using inferior materials is clearly one factor, but even high quality products will not perform in the intended manner if they are not properly installed. Well-designed details cannot perform as expected if they are not built well.
The blame for building envelope failures often originates with the designer, supplier, or installer: the designer for improper detailing, the supplier for unsuitable or defective products, and the installer for faulty implementation. And, of course, there are also times when more than one party is at fault. Determining what went wrong and who might be responsible requires strong engineering sense, a high level of technical expertise and years of experience.
Insurance firms, once armed with an expert report that goes well beyond surface claims to find the root causes, can recoup losses through subrogation. Often the actual party at fault might then be held accountable for the repair costs. Without expert assistance, however, often these root causes can go undetected, which will have an adverse impact on an insurer’s balance sheet. It makes clear economic sense to dig deeper and discover exactly where the fault originated, and who might be held accountable for the loss. Your chances of successfully subrogating relies on the quality of the opinion of the expert you have retained. An opinion derived from concrete technical facts is one that will withstand the test of technical opposition. An opinion derived from assumptions or limited technical knowledge is easily discredited and dismissed by opposing technical experts. So always remember: a high quality investigation and building envelope assessment conducted on your behalf ensures a higher potential for subrogation. Using advanced assessment techniques and analytical tools, Origin and Cause forensic experts investigate deteriorated and distressed building envelopes to determine the factors that have most likely caused or contributed to the failure. Origin and Cause also offers construction litigation support for legal and insurance purposes, including providing expert witness testimony in court where needed.