Landlords lose dispute after trying to claim for tenant's 'strong curries'

Landlords who said their property was damaged by a foul smell due to their tenants cooking “strong curries” will not be compensated for their losses after losing a claims dispute.

The complainants lodged a claim after they “noticed a smell” in the house after their tenants vacated it.

An IAG assessor who visited the property on February 11 last year noted a “strong curry smell” throughout the home and interior decorations but said it was caused accidentally.

The policyholders say they had to complete restoration works costing more than $12,000 before they could move back into the property, due to the “uninhabitable” smell. They also said the odour exacerbated one of the complainant’s allergies.

The insurer declined the claim, saying it did not fit into the policy criteria of accidental loss or damage caused by “an unintentional act, or an unforeseen and uncontrollable incident”.

It also said the damage could not be defined as a “malicious act,” which is also covered by the policy, because the tenants had permission to cook in the home.

The Australian Financial Complaints Authority (AFCA) backed the insurer’s decision, saying the alleged damage did not fall under cover of the policy.

“There is no dispute that the alleged damage claimed was due to the tenants cooking food. I do not consider that cooking is an unintentional act or an unforeseen and uncontrollable incident,” AFCA said.

“The tenants had permission to cook food at the property so the act of cooking does not meet the definition of a deliberate or intentional act under the definition in the malicious acts section of the policy.”

The ruling also shot down the complainant’s argument that the policy covered losses caused by tenant neglect, carelessness, poor housekeeping or unhygienic living habit, which it said was not evident.

“As part of the investigation of the claim, the complainants provided a routine inspection report from the real estate agent managing the property.

“In that report the real estate agent raised no issues with the cleanliness of the property. It also made no mention of any smell at the property.”

AFCA said it would be unfair to require IAG to pay for the claim when it was not covered by the policy.

“While I understand the complainants will be disappointed with the outcome, the insurer complied with the terms and conditions of the policy in declining the claim,” AFCA said.

Click here for the ruling.