California Business and Professions Code CHAPTER 9.3. Home Inspectors

Various posts on this board imply California has no inspector licensing, implying that means inspectors have no standards of practice to go by. Not quite true

California Business and Professions Code CHAPTER 9.3. Home Inspectors [7195 - 7199]

§ 7195. For purposes of this chapter, the following definitions apply:
(a) (1) “Home inspection” is a noninvasive, physical examination, performed for a fee in connection with a transfer, as defined in subdivision (e), of real property, of the mechanical, electrical, or plumbing systems or the structural and essential components of a residential dwelling of one to four units designed to identify material defects in those systems, structures, and components. “Home inspection” includes any consultation regarding the property that is represented to be a home inspection or any confusingly similar term.

And it gets quite specific, if briefly:

§ 7196.2. (a) If a home inspector observes any shade of yellow corrugated stainless steel tubing during a home inspection, the home inspector shall include that observation, and the following notification, in the home inspection report:

“Manufacturers of yellow corrugated stainless steel tubing believe that yellow corrugated stainless steel tubing is safer if properly bonded and grounded as required by the manufacturer’s installation instructions. Proper bonding and grounding of this product can only be determined by a licensed electrical contractor.”

And it prohibits any clause purporting to limit liability to the amount of the inspection fee.
See also AB-1024 Home Inspector Licensure Act from 2020.

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Yes, California has several specific laws about home inspections.


Well hold onto your pants, car has a rep at capital and they are pushing for inspector responsibility to 7 years and reducing Realtor responsibility to 1 year in California. I see all sorts of inspector agreements saying only responsible for inspection fee , but the buyers are ignorant of this. I did an expert witness case two months ago and the judge new his stuff, held the inspector for 60k responsibility and suggested the inspector stop using existing contract and use California friendly contract.

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The InterNACHI® California Home Inspection Agreement
still reflects the “our liability is limited to liquidated damages in an amount not greater than 1.5 times the fee you paid us.”


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In courts that will not be acceptable. If a Lawyer suing a home inspector
Will refer to the state professional code and nothing there says 1.5 times the amount. Just not acceptable in California courts.

We have a California inspection agreement template that can be customized. Visit InterNACHI® - International Association of Certified Home Inspectors.

And we have a webinar coming related to California home inspections:

Right or not, the Nachi agreement attempts to split hairs:

  1. LIMITATION ON LIABILITY AND DAMAGES. You waive any claim for consequential, exemplary, special or incidental damages or for the loss of
    the use of the home/building. California law provides that we may not include any limitation on the amount of damages in this agreement for any alleged failure to comply with Section 7196 of the California Business and Professional Code. As to other claims, we assume no liability for the cost of repair or replacement of unreported defects, either current or arising in the future. In those other cases, our liability is limited to liquidated damages in an amount not greater than 1.5 times the fee you paid us.

Yep thats right, its may work in other states but so far, not in California.

Do U have proof or experience with that in detail? I assume Nachi is trying to put a shot over the bow of the homeowner’s ship, more than taking a serious position in court.

Bryce are you California, if so go to a lawyer familiar with Real Estate transactions, show him / her the inspection Agreement then go over the professional code. I have been at this since 1989. Been using the same inspection Agreement since 1997 learned in 96 that the wording for responsible for only inspection fee would not fly in California. Creia was very instrumental in establishing that back in 1992 when the Realtors really started throwing the Inspectors under the Bus.

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Just read this state professional code. Explains it all