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Dubai Marina Torch Fire - What Next? Who Pays?

Dubai Marina Torch Fire – What Next? Who Pays?

March, 2015
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Non-fire retardant cladding poses an enormous risk for high-rises in the UAE, write Barry Greenberg and Michael Kortbawi from Bin Shabib & Associates.

The recent fire at the Torch tower located in Dubai Marina raises several important concerns as to the safety of many of Dubai’s buildings, whether any measures can be taken to improve these structures’ safety, the costs thereof, and who would be responsible for bearing these costs. While there are immediate concerns, such as relocating those whose homes have been damaged, there are longer term wider considerations that should now be addressed.

The Torch is a “super-tall” structure; an 86 story, 352 meter high tower. When it opened in 2011, it was the tallest residential building in the world, but soon lost that title to, among other buildings, the Princess Tower directly opposite the street. Located in an area of the Marina known as “the tallest block in the world” due to its tightly clustered group of super-tall skyscrapers, the Torch and its neighboring towers are considered to be engineering marvels and are in many ways symbolic of Dubai’s rapid rise in international status.

In the very early morning hours of February 21, the Torch caught fire. While the exact cause is as yet unknown, speculation is that the conflagration was started by a barbeque or shisha coal left out on one of the building’s balconies. It reportedly started somewhere around the 50th floor on one of the building’s corners and raced up that corner, ultimately reaching the top of the building. Fanned by unusually strong winds, the fire spread rapidly and pieces of flaming debris fell from the building, causing another fire on the adjacent corner of the building, which likewise raced upwards approximately 20 stories.

Despite the horrific scene wherein two sides of the building burned high above the street, firefighters through their heroic efforts were able to extinguish the blaze, no lives were lost, and there were only a handful of minor injuries. And despite the visually disturbing images – dramatic video resembling scenes from the 1970’s disaster film The Towering Inferno was quickly transmitted around the world – the actual interior damage was minimal, with most residents able to reoccupy their apartments within days.

Not the first time

The Torch was not the first Dubai skyscraper to burn. In November 2012, Tamweel Tower located in Jumeirah Lakes Towers ignited due to a lit cigarette tossed into a pile of rubbish. The fire spread through the aluminum cladding affixed to the tower’s sides, ultimately reaching and consuming a large portion of the structure’s roof. Fortunately though, as with the Torch, no lives were lost.

Currently, over two years after this blaze, Tamweel remains unoccupied, the interior damage being much more significant than that sustained by the Torch and its repairs delayed, pending resolution of a dispute between the building’s Homeowners Association and its insurer.

Safety Issues – Aluminum Composite Cladding

A contributing hazard at Tamweel was identified as the non fire-resistant aluminum composite panels utilised to clad the exterior of the building. These cladding panels contain a potentially dangerous mix of aluminum and polyurethane. The flammable material is sandwiched between layers of aluminum, and when exposed to flame or even extreme heat, will ignite.

In some cases, this situation is exacerbated by the affixing of these panels to grid-work with air pockets beneath, allowing flames and heat to travel up both sides of the panels, thus resulting in a quicker ignition time. One engineer has compared the amount of flammable material contained in the cladding of a large building fitted with this type of composite, to that of a tanker delivering petrol to a filling station.

As a result of the Tamweel fire, and several other high rise conflagrations elsewhere in the UAE, regulations were enacted banning the use of non fire resistant composite panels of the type that contributed to Tamweel’s immolation.

The UAE updated its Fire and Life Safety Code in 2013 to require that exterior cladding is fire-resistant on all new buildings over 15 meters tall. Some of the individual emirates, including Abu Dhabi and Dubai, had been working towards amending their building codes even prior to the Tamweel fire, to prohibit the use of non fire resistant cladding.

These requirements, however, do not apply to already existing buildings. It has been estimated that there may be hundreds of high-rise buildings in the UAE that are clad with flammable composite material panels, placing each of those buildings at a higher risk of fire.

It is unclear at this time whether the exterior cladding tiles contributed to the Torch fire, as a forensics report has not been issued. However, if one observed the fire as it occurred, watched the video, observed the crumpled shards of aluminum littering the street outside the Torch immediately after the fire, or took a look at the burn pattern, the question that immediately comes to mind is how this fire was able to so quickly climb 30 stories up the side of the building, ignite on the opposite side, and climb up 20 or so floors from that location.

The answer that seems obvious is that the exterior building material was flammable.

It must be noted that the Torch management has recently stated that the building was constructed in full conformity with the building code. However, whether the building was up to code when completed in 2011 does not preclude that flammable cladding was utilised, as such may have been legal at the time.

Retrofitting of Existing Structures

The question that many building owners may now ask is if their buildings are constructed with this potentially dangerous cladding, and if so whether they may want to replace this material with a fire-resistant substitute.

However, the cost of this replacement in both material and labour will be prohibitive. Consider the largest buildings; scaffolding will need to be erected over 300 meters high and along the entirety of the building perimeter – or rope removal and replacement teams deployed – and thousands of square meters of panels will need replacing. The costs could easily run into the tens of millions of dirhams.

The owners should consider, however, before rejecting the idea of retrofitting due to cost factors, the potential cost of not retrofitting; the cost of doing nothing might be incurred not only in dirhams, but in human lives.

When considering what happened at Tamweel and the Torch, the lack of any fatalities can be viewed as fortunate, as no matter how efficient the evacuation and fire fighters efforts were, loss of life in a high rise fire is a great risk. And given how rapidly the flames spread in these very tall structures, a mass casualty event cannot be ruled out in the future. This is a nightmare scenario that no one wants to see.

The monetary cost of these events cannot be understated either.

Total loss of a supertall building – requiring demolition and replacement – is a distinct possibility in the event of a fire. Extensive refitting and need to obtain alternate residences for the occupants, as has occurred with Tamweel, is a probability. Owners now need to carefully consider these factors if they determine that their buildings have been fitted with these materials.

Who Pays?

Most of the residential buildings constructed prior to the enactment of more stringent building requirements have been fully turned over by their developers to their individual unit owners – and are now run by the building homeowners’ associations (HOA). It is these HOAs that will bear at least the initial cost of the retrofitting.

The issue then arises if this loss can be shifted back to the developer, general contractor, responsible subcontractor, supplier, or architect/engineer who specified this type of composite paneling.

This cost shift will depend less on whether the developer warranted the structure beyond the turnover date, but rather an analysis of whether prevailing law permits a claim of negligence for which recovery may be had under these circumstances. One of the issues here is that there is no actual “loss” in the cases of voluntary retrofitting. No damage has occurred and the cladding is performing as advertised. The retrofitting is only undertaken to prevent a future danger, albeit in light of recent events, a very foreseeable one.

However, UAE Civil Code Articles 880 – 883 imposes joint liability upon contractors and architects for a period of 10 years, “for any defect which threatens the stability or safety of the building”. There is a three year statute of limitations running from the time the defect is discovered. When the nature of the defects in these cladding tiles is “discovered” will be one of the major issues subject of dispute.

If the owners seek recovery from the developers, general contractor, designers, or other trades, this will trigger insurance claims by these parties. Their insurers will in turn need to determine if cover applies. Their first inquiry will be if there is an occurrence that would trigger coverage. An “occurrence” or an “accident”, depending on the policy wording, is normally required to trigger the duty to defend and indemnify, and the insurer will likely argue that the mere replacement of these composite panels is definitionally not an occurrence.

Additional issues will be whether the policy provides cover for completed operations, impaired products, the insured’s work, whether sufficient notice of claim was provided, application of aggregate limits, and what policy period is implicated in any claim. Insurers will resist these claims on many of these grounds and the insured will likely have to initiate litigation in order to have any chance to recover from its insurers.

Insurers, however, need to look at the long term view before reflexively denying these claims. Should a tall building burn in the future, the insurer will certainly bear the risk. Had they instead agreed to honour a replacement claim earlier – allowing the retrofit to take place – perhaps on a proportional share basis, the loss could have been significantly mitigated, if not averted in its entirety.

The underwriters also need to take notice; a retrofitted structure carries a far lesser risk than one clad in flammable material. Perhaps there can be a mutually beneficial market oriented solution arrived at between building owners, contractors, and insurers where retrofitting costs are equitably distributed, rather than resorting to litigation or a dismissal of the idea of retrofitting due to the aforementioned difficulties.

Given the stakes and uncertainly that these issues collectively represent, the fallout from the recent Torch fire may have only begun. While those directly affected residents will need to find new homes until repairs are made, the ripples from this event may spread out throughout the UAE.

The enormous risk posed by non fire retardant building cladding has once again been pushed into the forefront of the news, raising longer term considerations as to how best prevent reoccurrence of potentially worse tragedies.

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Published: March 2015
Publication: Gulf Business  
Title: Dubai Marina Torch Fire – What Next? Who Pays?
Practice: Insurance & Reinsurance, Construction
Authors: Michael Kortbawi, Barry Greenberg

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