Going to Court

#1

I see VERY often comments about going to court, or testifying in court, or libility, or being held accountable. Generally a very paranoid feeling about what liabilities you guys have.

What I am getting at is what legal liability could you guys possibly have??? You are not installing anything. You are not building anything. You are providing a service based on knowledge and opinion. How can you be held liable for this?
This is not a flame.This is a serious question that I am curious about.
It seems to me that the installer has MUCH more liability. I mean if I do something wrong, and someone gets hurt, I AM responsible.
My insurance rates tell me this does happen from time to time.

I can understand if you do an inspection and miss something major, but I regularly see this “fear” mentioned. From some members it seems every other post has some comment about their fear of going to court.

My question(s) is: Who here has had to go to court over your inspections? Or have you ever had to legally defend yourself?
If so WHY?
Also, are you guys required to carry liability insurance?

#2

There have been many discussions & polls about this on other threads.

#3

That would take a ton of time to answer specifically, but in short, generally, when a buyer moves into a home and they find a problem, they expect to find someone accountable to this. More often than not, it is their inspector (so they believe), as we were the last ones to “inspect” everything, and as such, we should have addressed the issue (however that may look to the buyer).

Some states require professional insurance in the form of E&O (errors & omissions) while others do not. Personally, even though I’ve never been sued, I don’t think an inspector should be operating without it.

#4

I would not recommend discussing this under an open forum (Electrical).

#5

I agree .Thanks Joe,
If you would like some examples please send me your email and I can give you some Info . … Cookie Roycooke@sympatico.ca

#6

Some helpful posters can’t participate in our non-public forums. There’s no harm in answering questions such as these as long as we remain professional. . .

#7

No big deal Jeff. I was just curious.

I find it hard to believe that a H-I could be even remotely responsible for a pre-existing problem as long as they did a thorough inspection.

It also bothers me that some folks always need to find someone else to blame for everything. THIS is why folks are so paranoid these days.

Thanks anyway guys.

#8

Hey Speedy, I ended up in small claims court in the first three months of my career. Lady buying a condo was pissed off that areas I called out to repair, leaked. Go figure. I was a witness in the case after I explained to her that I told her to fix quite a few areas.

I went to court and said a lot of “I do not remember EXACTLY what I said at the time, I would have to review my report.” :slight_smile:

The judge leaned in to the witness box and said “That’s OK, we are all using YOUR REPORT :shock: as the primary piece of evidence in the case, here use mine”

I read from my report to answer any more questions and left.
Stuff happens.

#9

"I find it hard to believe that a HI could be even remotely responsible for a pre-existing problem as long as they did a thorough inspection".

Gosh, if that were just so!

A new buyer moves into a house with a 6 month old roof. The house was inspected but it was raining and the inspector could not get on the roof to see that a piece of flashing was missing. THe inspector noted that it was raining and his roof inspection was limited, there were no signs of leaks in the attic (which he walked), yaddi, yaddi, yaddi. About 4 months later the roof leaks. The seller is in Canada, the roofer is out of business.

Who do you think gets the call and gets sued? I’m defending this one for another inspector right now.

Happens a lot.

#10

Those sneaky Canadians…they let everyone hide there!!!

#11

Absolutely, most suits are filed for breach of contract, and/or negligent misrepresentation.

This may help explain it as viewed by Canadian courts, this is the benchmark. What is the test in law for “negligence” in the context of home inspections? Here is what is required as stated by the Supreme Court of Canada.

[23] Because the core of the service provided by the home inspector is the advice given regarding the condition of the home, claims against home inspectors in superior courts have been pleaded and considered by the court in the context of the tort of negligent misrepresentation. The five elements to be proven in that tort, as articulated by the Supreme Court of Canada in Queen v. Cognos Inc. 1993 CanLII 146 (S.C.C.), (1993) 99 D.L.R. (4th) 626, are well established:

  1. there must be a duty of care based on a special relationship between the parties,
  2. the representation made by one party to the other must be false, inaccurate or misleading,
  3. the representation must be made negligently,
  4. the person to whom the representation is made must have reasonably relied on the representation and,
  5. the reliance must have been detrimental to that person with the consequence of his suffering damages.
    [24] The third requirement that “the representation must be made negligently” one presumes will fall to be determined by application of the test applicable to other types of “professional negligence”, namely, that the home inspector failed to meet the standard of care expected of a reasonably prudent home inspector in those circumstances and at that time.

I agree, it is not as frequent as perhaps we are led to believe.

I was sued but it never made it to court, the insurer decided to settle out of court. Many claims never make it to court, most are settled at examination for discovery.

#12

Peter,

Basically it is more of an issue on the west coast right now where attorneys will go after everyone involved in the real estate transaction in the event something is missed be it obvious or not.

I am sure cases are also happening back on the east coast but just not at the same rate as it is on the west coast.

When someone makes an investment which might be the largest they ever make and find out they bought a lemon they are always looking for someone to go after, the fact is while HI’s are doing a visual inspection only the more indepth inspections they do ( thermal and so on ) in my opinion may just open them up even more because a judge will say…well you should have seen that with your high tech equipment since you offer it…but alas thats just a thought…

You know as well as I do how attorneys are, as a electrician I know 100% that all my installations are 100% up to the minimum standard of the NEC and most of the time go above the minimum standard so I feel safe with my installations and my stance in court…BUT with an HI they are trying to cover many things…many trades and it really depends on the level of experience they have…for example there are good inspectors and great inspectors…nothing wrong with being either…but one may have more knowledge than the other and might not miss something important…or they could be GREAT inspectors and miss something because they get in a " SAME OLE’ SAME OLE’ " type of rutt and get clumbsy…it can happen as we are all just human.

So in the end the HI is also the last ability for the consumer to CANCEL a purchase and it opens up the lawsuits as well from lets say a seller who has a HI come in and it was fine and then the buyer brings one in and it ends the deal because he finds alot…just maybe the seller has been sitting on it awhile and the HI blows his deal…could be a lawsuit if the HI is calling out petty things in the eyes of the court that killed a deal for the seller…thats just one example of a new type of lawsuit…

The HI is getting more high tech and more indepth and is quite possibly becoming less of a " Generalist " by nature which in turn opens up even more liablity in the long run which means they have to be MORE trained and SHOULD be held to a higher standard…thus my vision of what the CMI program was to become…a higher tear to achieve…but many dont feel the same as me on that so I digress…

In the end…the HI is open to lawsuits simply because they are expected to see things and if they happen to miss something that SHOULD have been seen due to possibly lack of education or experience…then lawsuits will happen…in the end it is like any industry as once the lawyers get involved ( some lawyers…not NACHI Lawyers…lol )it takes on a new low as you sue anyone involved and see what sticks.

#13

The real problem is, the US may be the only country in the world where you can sign a blanket waiver obsolving another party of any liability and you can still sue them for something that was your fault.

The HI contract my kids signed pretty much said the HI was not qualified to evaluate anything and he was not responsible for anything he didn’t see. I bet he still gets sued from time to time.

#14

Yep…it is a matter of DEEP Pockets and when they THROW all the DOO-DOO against the wall… which sticks better…we just would like to make sure it does not stick WELL on the wall that is associated with the HI…

Now that is a CRAPPY analogy I might add.

#15

THIS is something that makes my blood BOIL!!!

You can run head first into a wall, sue the wall and win.

The dumbass lady with the McDonald’s coffee was the kicker IMO. How did that case EVER make it to court. I want to become a judge so I can tell folks like that, AND their lawyers, to F-off!

How did we let our great country sink into such a dismal place!

#16

Once one lawsuit was successful…others follow…thus the spiral effect happens.

#17

Put the blame on insurers who pay out, turn around and tell everyone that inspectors are a bad risk, therefore keeping the premiums up.

#18

I recently got my Public Adjusters license and during class one of the stats that came out was, You are three times more likely to be sued in the US than anywhere else on the planet. Now, consider how many areas of the country where the potential is very low and you can see how or where in other parts the level is going to be significantly higher (in order for it to average out nationally). Those areas are where the HI or anyone is more likely to be sued for just breathing.

#19

Requirements are not the issue.

How many electricianns carry E&O insurance, required or not?

There is a big different between liability insurance (which usually only covers damages done during the job) and and E&O insurance (which covers damages (both physical and otherwise).

I have seen many houses that were built and didn’t burn down or cause damage during the building period. I have also seen a couple of houses that had electrical (and roofing and masonry and foundation and plumbing and HVAC and drywall and tile, etc) problems show themselves, caused by improper installation, a year or two after the house was sold.

But, I have never seen or heard of a sub-contractor’s insurance covering the damage caused by these type of problems.

Please, don’t pull this liability crap. Subs are never, that I have ever heard of, held responsible for work they do when the defects show up later. Builders, some times (but the owners rarely collect because the builder’s go bankrupt!) and HIs, usually.

I have also never heard of a sub or a builder being heald to fiduciary duty.

HI’s are not in the ‘trades’, we inspect the work that the trades do.

Big difference.

#20

Insurance companies are just bookies. They don’t care who wins, the customers do all the paying and the bookie just takes his “vig”.
Big payouts mean more vig for the bookie.

Homeowners has gotten so bad in Florida I am seriously wondering if it is even a good bet. I would be happy if I could just get fire and theft, self insuring for windstorm.