Lost inspection due to agreement

I use the NACHI agreement and of course has been adopted by my insurance carrier as well. I booked an inspection and sent out the online agreement to the buyer. The buyer contacted me back and said that he could not agree to paragraph 4 and that I would have to cross it out. (the buyer is an attorney). I told him that my attorney reviewed the agreement along with my insurance carrier and that in no way would I cross out anything on the agreement. He said thanks and that he would find another inspector. He found another NACHI inspector in town that was willing to cross out paragraph 4 and did the inspection. He said that if he was negligent paragraph 4 wouldnt matter anyway and he would be liable anyway. This may be true, but his insurance company would not pay either if the contract was altered. Just wanted some feedback is all in this.



I do not alter my agreement by request of any client, even the Pope (no, not you Jeff Pope ;-)). As for the Inspector that did agree to alter his agreement, I would expect that he has now explicitly implied that he has now assumed the risk for whatever that paragraph tried to limit his exposure to. The other Inspector would have been better off not having that paragraph in there in the first place. At least that way his actions would not necessarily have been interpreted as “explicit agreement”.

Whether it is a lawyer, grocery store clerk or whoever, I do not change my agreement! Sometimes it is better to lose the inspection, if that happens, than deal with someone who starts demanding changes of that type.

iNACHI Agreement paragraph 4:

This is my paragraph 4 from the NACHI online agreement.

INSPECTOR assumes no liability for the cost of repair or replacement of unreported defects or deficiencies either current or arising in the future. CLIENT acknowledges that the liability of INSPECTOR, its agents, employees, for claims or damages, costs of defense or suit, attorney’s fees and expenses and payments arising out of or related to the INSPECTOR’s negligence or breach of any obligation under this Agreement, including errors and omissions in the inspection or the report, shall be limited to liquidated damages in an amount equal to the fee paid to the INSPECTOR, and this liability shall be exclusive. CLIENT waives any claim for consequential, exemplary, special or incidental damages or for the loss of the use of the home/building even if the CLIENT has been advised of the possibility of such damages. The parties acknowledge that the liquidated damages are not intended as a penalty but are intended (i) to reflect the fact that actual damages may be difficult and impractical to ascertain; (ii) to allocate risk among the INSPECTOR and CLIENT; and (iii) to enable the INSPECTOR to perform the inspection at the stated fee.

I agree 100%

If y’all paid attention to past posts from Atty Joe Ferry (long, long ago), limitation of liability does not stand up in court in most cases in many states.

This is considered as a contract that was not negotiated for. Rather a “take-it-or-leave-it” contract. It seldom holds water.

I asked my lawyer if I should remove it and he stated that even though it is not enforceable in my state, it may fend off some complaints, so leave it alone.

I also added an endorsement line for this paragraph (which is why it can not be enforced in this state without endorsement) that the client can accept or reject. If they accept the limitation and signed off on it, I might have a slight chance in hell for some unknown judge to uphold it as a contract. Slim to none! If they don’t sign off on it, it’s not enforceable anyway.

So, you just threw away an inspection!
Did your E&O provider tell you that you can not take out an unenforceable clause to your inspection agreement, or are you just assuming this?

You may not have wanted to work for an attorney anyway!
However, I have worked for many lawyers and judges and have had no problems from them. They know the law. The average low ball client doesn’t, and expects everything!

Call your lawyer before you give away any more inspections.

We don’t even use an agreement. The company I use to work for does not use one either. They have been in business for almost 20 years and done over 25,000 inspections and never had a problem.

We do have a Terms & Conditions that explains what be are responsible for and what we exclude from the inspection. We included it with each report. This is all we use -

The receipt and use of this report for its intended purpose constitutes acceptance of the following Terms and Conditions. An inspection of the type indicated on page 1 of the report has been performed on the subject property. Payment for this service is required when the report is delivered. An additional fee of $30 will be added to the inspection fee when payment is payed at closing. All pay at closings must be secured with a credit card. Credit card payment will automaticly be billed 7 days after the closing date, unless additional arragments are made.

The report is based on the inspector’s opinion of all information obtained through an extensive visual inspection of the premises. No warranty or insurance policy is either issued or implied. The liability of** Priority Home Inspections, Inc.** is limited to the inspection report fee. No errors or omissions claim will be considered if any repair work is begun or completed prior to Priority Home Inspections, Inc. written approval. No claim of any type will be considered more than 90 days after the date of the inspection.

The findings are not intended to cover latent defects that might not be discovered without extensive removal or disassembly of wall, floor, or ceiling coverings, wallboard, molding, or structural assemblies inaccessible for visual inspection. We are not responsible for moving personal items to gain inspection access.

The report represents the condition of the property and associated systems at the time of the inspection only. Changes to the reported condition of the property and associated systems occurring after the inspection and caused by failure to correct an existing deficiency, fair wear and tear, age and deterioration, expiration of useful life, lack of preventative maintenance and/or services, neglect, abuse, or acts of God are not the responsibility of **Priority Home Inspections, Inc., or the Real Estate Agents. **

The inspection report is the personal property of the person(s) for whom the inspection is performed and will not be used under any circumstances by any other party as evidence of the condition of the property and associated systems.

The inspector represents himself to be a subject matter specialist on the inspection of property and associated systems found in residential and commercial properties.** Priority Home Inspections, Inc.** ** **is a corporation licensed by Brevard County.

Priority Home Inspections, Inc. is not responsible for damages beyond our control, to the subject property occurring during or as a result of the inspection.

The inspection is in accordance with the standard operating procedures of the National Association of Certified Home Inspectors (NACHI).

We welcome questions on any aspect of our service, our inspection techniques, and the accompanying report.

So in essence you have an unsigned inspection agreement, with a standards base of one inspector.

With a disclaimer like that, Why would anyone bother hiring an inspector?:roll:

This is what we email them after they book the job. We also include it and the above Terms and conditions with the inspection report.

About the Inspection

Thank you for choosing Priority Home Inspections Inc. for the very important task of performing a property inspection prior to purchase or sale. We take our role very seriously and pledge to you that every effort will be made to completely and accurately disclose the condition of the property at the time of the inspection.

There are a few things that you need to know about the inspection and how it is performed. The inspection is a visual examination of structural and mechanical components. The inspection is conducted in accordance with the standards of practice of the National Association of Certified Home Inspectors (NACHI). Most items are included and some items are excluded. It is very important that you refer to your purchase contract (Paragraph N of the FAR/BAR contract) to determine the responsibilities of both buyer and seller regarding the inspection process and the inspection results. **Please note that the seller is not responsible to correct every type of defect. The contract is the guide for both the scope of repairs required and the seller’s financial limit for repairs. **

Our “Contract Compliance Inspection” covers those items identified by Paragraph N: Structure, Roof, Heating and Air Conditioning, Electrical and Plumbing systems, Appliances and mechanical items. Buyers are advised that when inspections of occupied properties are conducted, certain conditions may be masked or hidden from view by furniture, boxes, personal property, etc. Buyers are further advised to conduct their own “walk – through” inspection just prior to closing to insure that conditions have not changed or previously undisclosed conditions existing. In all cases buyers are responsible for knowledge of obvious cosmetic deficiencies such as carpet stains, minor wallboard damage, peeling paint, etc.

Some items are excluded from the inspection. These include underground and in-wall pipes and wiring, telephone lines and TV cables, underground tanks, portions of the foundation and structure not exposed to view, water treatment systems, security systems, intercoms, self-cleaning ovens, low voltage lighting systems, fences, non built-in appliances (countertop microwaves) and appliances not installed in the location where they are normally used (garage refrigerators), specialty or one of a kind items or devices, and obsolete systems or devices. Also excluded are those items cited in the FAR/BAR contract as not subject to repairs, such as torn screens.

Information on properties is routinely taken from Multiple Listing Service (MLS) entries and county tax records. In all cases efforts are made to confirm the accuracy of this information. In some cases this is not possible and buyers are referred to the applicable municipal building department to confirm the existence and /or dates of permits authorizing any work in question. Buyers are advised to ask the seller to fill out a disclosure form regarding the condition and history of the property. A properly prepared disclosure form and an inspection report can provide valuable perspective on any property.

Again, thank you for choosing Priority Home Inspections Inc. If we can be of further service please contact us at (321)-368-9921.

Code of Ethics

  1. The InterNACHI member shall use a written contract that specifies the services to be performed, limitations of services and fees.

Interesting post. I have a similar clause pertaining to paragraph 4 in my inspection agreement, which was approved by my insurance carrier. I have done inspections for numerous Attorneys; hardly any of them really read it and just sign then give me a check prior to the inspection. Maybe the attorney who turned you down thought that the contract was negotiable. Which it is not!

That very language has saved me a date with an attorney many months back. It seems as if the client, whom has utilized my services two times before, thought I did not throughly inspect part of a garage wall that showed some moisture. (This was highlighted in the report to have a specialist inspect that same area.) We talked back and forth on the subject, which he had repaired at his cost. (I mostly listened as I find this a good way of finding out what the client is really wanting. Has yet to get to the shouting stage.) The client stated he saw the section in the contract about only getting the amount of the inspection returned if their were problems. Seeing an opening, and he did mention his attorney one time, I asked if he wanted a refund and he stated that would be a wonderful gesture on my part. He was very appreciative and would still refer me if the situation arose. (He also signed a release as condition of the refund)

So contracts with the proper wording does protect once in awhile.

I would be VERY leery of someone asking me to delete a portion of my contact. Although I’m aware that anyone can sue you for anything nowadays, I’m certainly not going to give them an edge, or an opening to that end…

And I’m puzzled by Dan Harris’ comment >???
Dan, would you care to elaborate?

I think our contract helps keep the honest people honest, they tend to think twice about a lawsuit . . . I think we face the potential of being sued for any reason . . . I wouldn’t change my contract for any reason . . . I believe in helps keep me out of court and I go over every section before the client signs which seems to help.
I was thinking of several lawyers I’ve inspected homes for and they thought my agreement was OK . . . can they still come after me? YUP! Will they . . . hope not.
So, Chuck, I would have lost the inspection as well.
Hope my 2 ¢ helped.

I did talk this incident over with my attorney and he told me that I did the best thing. This to him was a “red flag”. I have done inspections for attorneys in the past as well and this was the first to ask me to line over anything in the agreement. In fact, I have spoken with two other attorneys this week and they said I did the right thing.


You hit it on the nose!!

I see nothing in any of your agreements/conditions that say anything about, or disclaim mold, radon, termites, and enviromental issues/areas. All of you can be sued for these areas, unless you state it. Better save your money. You are going to need it. I thought simular language would protect me from evironmental substances; it did not. Good luck using what you guys have.

I totally agree with what you said

Look at paragraph 2 in the online agreement form

I would treat that type of request as I would a potential client asking about Insurance coverage.