Q. The people who were buying our home canceled the deal on the advice of their home inspector. During the inspection, he found a crack in the foundation, which he blew entirely out of proportion. After taking some measurements, he concluded that the foundation was compromised and settling, and he advised the buyers not to purchase our property. They backed out of the deal on the spot. The fact is, our foundation underwent major repairs several years ago and at great expense. If anyone would have asked, we could have shown receipts from the structural engineer and the general contractor who made the repairs. Now the property is back on the market and we just accepted a lower purchase price than we had with the previous buyers. Is it right for home inspectors to make these kinds of recommendations, and is the home inspector liable for our financial loss?
A. Your situation raises three separate issues: Should home inspectors make structural evaluations? Should home inspectors advise buyers regarding whether to buy a property? And are home inspectors financially liable when they cause a deal to fall out of escrow? Let's take these in order.
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A home inspector who is not a licensed structural engineer is not qualified to determine the severity of structure defects. If an inspector finds a foundation crack large enough to be of concern, "further evaluation by a licensed structural engineer" is the only justifiable recommendation. That is what should have been stated in the inspection report on your home. If that had been the inspector's conclusion, the history of your foundation repairs would have been brought to light, and the decision to buy the home or to cancel the deal would have been based on factual information, rather than the impulse-based conclusions of an overreaching home inspector.
Home inspectors who do what you have described are totally out of bounds for their profession and have a lot to learn about the scope and limitations of the home-inspection process.
A home inspector who is not a professional real estate investment adviser has no business advising someone whether or not to buy a property. The inspector's job is to disclose observable conditions that would be of concern to homebuyers and to make recommendations for further evaluation or repair of those defects. Buyers should decide for themselves whether or not to buy a property, based on factual and reliable information, not on the investment advice of a home inspector.
Whether you can hold the inspector liable for damages is a question for an attorney. However, the cost of litigation makes this kind of claim a risky gamble. On the other hand, if you want to educate the inspector about the established, ethical boundaries of his profession and possibly recover a few thousand dollars, you can take a shot at small claims court. If you decide to take that approach, get some advice from an attorney on how to present your case.
• To write to Barry Stone, visit him on the web at www.housedetective.com, or write AMG, 1776 Jami Lee Court, Suite 218, San Luis Obispo, CA 94301.
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