Client selling the report

General Inspection Topics
1

Ok, is it legal for a client to sell the report to the next buyer if he doesn’t buy the house?

Cheers

Denis

PS: I’ve been reading a lot of these posts. Thanks to all of you that keep helping everyone.

2

Denis, many inspectors insist that they own the report themselves and spend time trying to quell a sale like you describe.

I never worried about it and never hd a problem in over 40 years.

I guess contacting your attorney or InterNACHI’s attorney (free, I believe) at fastreply@InterNACHI.org is you choice at this point.

Good luck!

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3

Welcome back to our forum, Denis!..Enjoy!

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4

Many inspectors (including myself) have language in the report stating that the home inspection is a snapshot in time for conditions at the time of the inspection and is no guarantee or warranty for the future. And that the report is made for the client and is not transferrable to third parties. And that no legal obligation expressed or implied exists to anyone but your client.

You can’t stop your client from sharing the report but having statements to this effect may help protect you from any third parties from trying to make you responsible for anything in (or missing from) your report.

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5

Thanks. That makes great sense. I was thinking of doing something similar.

Thank you.

Denis

Denis Lacroix
www.Lacroix Home Inspection.com
250-344-1940

6

Statements to that effect may discourage the practice of selling reports. I had similar comments, however, I went one step further with a section in the inspection agreement that stated the client was responsible financially, if I, or my company were sued by a third party. I always pointed that out. Gives them something to think about.

Cheers

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7

Denis, I just had this happen to me about a month age. I did an inspection on a Monday and the buyer backed out on Tuesday and another buyer called for the same property on Wednesday. I know nothing had been repaired(it was a summer home) but the first buyer said they would be willing to sell the report to the second buyer. I wasn’t sure how to deal with this so I called Joe Denneler and he gave me advice on how to handle it. The second buyer paid the first buyer and the second buyer had to sign a PIA with me and then I met them at the site and went over the report with the new buyer. I got a consultation fee for my time. The 2nd buyer ended up backing out also. There was major stucco issues. My advice to you is to reach out to Internachi(Joe is counsel) and get the legal way to handle your situation. Good luck!

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8

Another gold nugget from Ed, above me here.^^^^^^^^^^

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9

Thanks guys. All this info is awesome.
I’m really enjoying this forum.

I think I’ll get in touch with internachi’s lawyers. Lol

Thanks again everyone.

D.

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  1. Our inspection and report are for your use only. You give us permission to discuss our observations with real estate agents, owners, repair persons, or other interested parties. You will be the sole owner of the report and all rights to it. We are not responsible for use or misinterpretation by third parties, and third parties who rely on it in any way do so at their own risk and release us (including employees and business entities) from any liability whatsoever. If you or any person acting on your behalf provide the report to a third party who then sues you and/or us, you release us from any liability and agree to pay our costs and legal fees in defending any action naming us. Our inspection and report are in no way a guarantee or warranty, express or implied, regarding the future use, operability, habitability or suitability of the home/building or its components. We disclaim all warranties, express or implied, to the fullest extent allowed by law.
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11

Exactly!
Cheers

12

Like your medical records … the client can give a copy to whoever they want

13

Did you ask the attorney what would happen if the 2nd buyer proceeded with the purchase… and between Monday and Wednesday something failed that was not in your dated report, who would be held liable? In essence, you have facilitated a sale of a dated report 2nd time. Where do you draw the line? 2 days, 1 week, 1 month?

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14

Hi,

Thanks, that’s what I was looking at in the agreement. I guess I could attach a copy of the agreement with the report.

You guys are great!

Thanks again.

Denis

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  1. The inspection and report are for the use of CLIENT only, who gives INSPECTOR permission to discuss observations with real estate agents, owners, repairpersons, and other interested parties. INSPECTOR shall be the sole owner of the report and all rights to it.

This is the agreement I use. According to my agreement if you sell the inspection report you are selling my property.

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16

I will bet that this happens more than we know, it’s just that on a rare occasion we will hear about it. I have had a few times where a third-party (another buyer but More often its another buyer’s idiot Agent, that should know better) has called me to ask a question with reference to my report they did not contract or pay for. (usually takes me a minute to find out they were not actually my client). I informed them about the pitfalls of relying on a report not specifically provided to them and also inform them I am not legally in the position to disclose any information to a third party not directly involved in the purchase of the home by my original client as per the PIA signed by my client. (they are not getting information from me for free…especially any information that may be used against me in a court of law).

They may also run into problems if they need to use their home warranty. Many times I will have had a warranty company contact me for a copy of the report. (they are looking for pre-existing conditions) And I’m sure that a home warranty company will look for any excuse not to pay a claim and certainly it would look fishy if the name on the report is not the same as the person filing the claim, or there are some dates with inspection or other transactions that do not match up.

It is going to happen and there’s not much we can do about it except that we’ve make sure that we are not caught in the middle of something that could harm us.

17

I put that statement at the bottom of the front cover.

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18

Simon, I understand what you are getting at but these questions were asked of the attorney. The second buyer was aware and signed the agreement stating they were aware that the inspection took place 2 days prior. The home in question was only 6 years old and was vacant. It is a waterfront vacation home that is only used in the summer months. There was minimal issues with my inspection. The big problem was with the stucco exterior. Another company did the stucco inspection for both buyers. My agreement disclaims stucco. As far as time, if it was a month I would definitely do the complete inspection again and collect the fee. The attorney(Joe Denneler) indicated this is a very common situation even though I had never come across this before. He stated the reason is there are a lot of inspectors in my area. It is common in areas that have few inspectors.

19

It is in the InterNACHI contract the client signs before inspection

John V Olson
'Home Inspect Pros’
920-639-7260

20

John, I do not use the InterNACHI contract or SOP. In NJ we have our own standards that we have to abide by and my PIA was designed to the state regulations and prepared by Joe Denneler(InterNACHI attorney) though his other company, Inspectioncontracts. He prepares agreements that are state specific.

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