New service for members who discover foundation issues.

[James H. Bushart]

Still waiting for the experts to weigh in on this, Nick....but until they do:

When my report recommends the client contract an expert for further evaluation and advice and they do...on their own....I have no connection to that expert or his advice. If he is right or if he is wrong, his relationship with his client excludes me.

When I am the one who provides the expert...when the client chooses to use the expert that I provide...who uses my photos, etc.....the separation between me and he is not that clear.

The question is....and this can only be answered by the insurance carriers or their representatives....is whether or not I am covered for THEIR mistakes, for it is already evident that they were acting as my agents.

[Michael R. Boyett]

This “Hotline” cannot be a central clearing house outside of Texas for Texas calls. The calls in Texas must go directly to a PE firm here for calls originating in Texas. No firm may practice any facet of Engineering in Texas, regardless where in the country they are located, without being licensed here. If using a central point of contact as a clearinghouse for the calls then they must be registered as an Engineering firm here. Other states may have similar laws.

§137.77 Firm Registration Compliance
(a) Any firm or other business entity shall not offer or perform engineering services to the public unless registered with the board pursuant to the requirements of Chapter 135 of this title (relating to Firm Registration).
(b) A firm shall provide that at least one full-time active license holder is employed with the entity and that the active license holder performs or directly supervises all engineering work and activities that require a license that is performed in the primary, branch, remote, or project office(s).
(d) No engineering services are to be offered to or performed for the public in Texas by a firm while that firm does not have a current certificate of registration.
(e) A business entity that offers or is engaged in the practice of engineering in Texas and is not registered with the board or has previously been registered with the board and whose registration has expired shall be considered to be in violation of the Act and board rules and will be subject to administrative penalties as set forth in §§1001.501-508 of the Act and §139.35 of this title (relating to Penalties and Sanctions).

[Nick Gromicko]

When my report recommends the client contract an expert for further evaluation and advice and they do...on their own....I have no connection to that expert or his advice.

I hear what you are saying.

Yes, that carries some less liability and some more liability. Less because a negligent referral claim can't be made against you when you did not refer anyone. More because of what Joe Ferry has explained many times. Inspectors regularly get sued for things they found and reported! The client (now plaintiff) claims that the inspector didn't emphasize its importance enough.

So let's get real world here. If you find a structural issue, the client ignores your report (the most common scenario in inspector lawsuits), and the house falls down... guess what? You are getting sued anyway!

Now we all know that winning a lawsuit is about as expensive as losing one. So the idea is to avoid it altogether.

So how do we do avoid anyone from filing the suit in the first place (since it really doesn't matter to our pocket books who is actually right or wrong).

The only way for your client not to file a suit is for there not to be a problem with the house he/she ends up buying.

There are 3 ways to end up there.

1. For there actually to be nothing wrong with the home. An expert can help us better determine that.
2. For the expert to tell the client that there is something wrong and causes the client to walk. In that case, it doesn't really matter to the inspector (in terms of liability) if there actually was something wrong or not, or if the expert was correct or not. The client didn't buy the home and so can't sue the inspector.
3. For the expert to tell the client that there is something wrong and that advice leading to a repair. The house would then be repaired and so the inspector wouldn't get sued.

These are all highly likely outcomes that favor the inspector (in terms of liability).

Should the house collapse, we're all getting sued anyway, no matter who said what.

In summary, the overall financial risk to the inspector is dependent far more on if our client buys a home with a defect at all... than it is on if our client's claim of negligent referral after a lawsuit is filed, is somehow strengthened.

That's my thinking.

[James H. Bushart]

Perhaps.....still waiting on a legitimate expert to provide some guidance, here.

We don't need Joe Ferry to tell us that anyone can be sued for anything at any given time. The only sure fire way of avoiding the lawsuit is to turn down the inspection.

But in the conduct of an inspection and in writing a report, there are things that we do (or can do, or shouldn't do) that can increase not just the possibility of a lawsuit, but the probability of a finding in favor of those suing us.

Finding a crack and recommending that the client seek an expert evaluation as to its relevance to any structural issues is part of the SOP. I have nothing to gain if they were to use my "Official NACHI expert" or hired one on their own.

In fact...and this is where I am hoping an expert will provide some advice...it seems to me that the likelihood of my being held culpable for the advice rendered by the expert to the client increases, exponentially, when (1) I provided the expert and (2) the expert relied upon my photographs or my description of the crack to render an errant opinion.

Since lawsuits can be filed for anything at anytime....it's never a good idea to provide the Plaintiff with a winning lawsuit, IMO. I would prefer that they try to sue me for following the bad advice of their OWN expert with whom I had no connection with, at all.

[Brian E. Kelly]

http://www.ramjack.com/

[Nick Gromicko]

I've done so much ring time that I've learned (despite what attorneys say) to give almost no weight to the merits of the plaintiff's case.

All attention should be aimed at avoiding, not winning. Winning and losing are twins from a financial standpoint.

[dharris]

Gee Nick.. Your on to something. I'm ready to sign up
Just a couple clarifications needed.

1.. This enginering firm hires employees that have proper engineering schooling provided by a state lic, school, Correct? [ not a $19.95 mail order degree convicts can get in prison, or some cert that was made up by 1 person for a new non-profit engineering firm ]

2... E@O that will cover me like HI insurance companys do to protect realtors.
Send me that info, along with a copy of their AZ engineering lic, and my ck for will be in the mail for $289.00 upon reciept.

[Nick Gromicko]

Correct, the next best thing (in terms of avoiding a suit altogether) to your client walking on the deal... is to actually shove a licensed expert between you and your client that results in an engineer approved repair.

[James H. Bushart]

Originally Posted by gromicko

I've done so much ring time that I've learned (despite what attorneys say) to give almost no weight to the merits of the plaintiff's case.

All attention should be aimed at avoiding, not winning. Winning and losing are twins from a financial standpoint.

One does not want to avoid coverage by his insurance company.

That's why we need an expert from that arena to provide guidance, here.

Likewise, when one receives a "demand" letter, there is something that is richly comforting and rewarding by being in the right...and clearly explaining to the lawyer making the demand that he has no case against him since his client received his bad advice from someone of his own choosing and not connected to the inspector in any way. When demand letters are met with irrefutable evidence that the client has no claim against the inspector, they often go no further. Ferry claims to have written such responses, himself, based upon the absence of wrongdoing on the part of the inspector.

An expert provided by the inspector or the client, either way, does nothing to stop someone from suing you. But it looks like it could keep someone from insuring you, should your carrier not want to cover YOU for the opinion of someone else.

Referring an expert to evaluate and leaving it at that...also leaves you covered. Providing the expert and the objects for his review....may interfere with that coverage, and leave you exposed.

[Nick Gromicko]

it looks like it could keep someone from insuring you, should your carrier not want to cover YOU for the opinion of someone else.

I doubt if any insurance company would insure you for the opinion of someone else.

However I think that your overall financial liability (after the increase in risk and decrease in risk) is dramatically reduced overall by helping your client to procure the opinion of a licensed expert in a matter such as a possible foundation failure, even if that expert is later shown to be incorrect (something you do not have the expertise to determine ahead of time).

[James H. Bushart]

Originally Posted by gromicko

I doubt if any insurance company would insure you for the opinion of someone else.

However I think that your overall financial liability (after the increase in risk and decrease in risk) is dramatically reduced overall by helping to procure the opinion of a licensed expert in a matter such as a possible foundation failure, even if that expert is later shown to be incorrect (something you would not have the expertise to determine ahead of time).

Perhaps. I suppose one conjecture is as good as another.

Still...it would be very beneficial to have Ben, Schyler, or Nigel to weigh in on this. Even Joe Farsetta, from an ADRS point of view, might have an opinion that would add weight to one side of this argument.

[Nick Gromicko]

One thing is certain though, unless the expert loses the suit against him/her, the inspector can't lose for negligent referral.

There are many reasons to do it.

There is one unlikely scenario that you wouldn't want to have happen and that is:

1. There is a problem.
2. The expert didn't pick it up.
3. The expert and inspector get sued.
4. The expert was shown to be incorrect.
5. The expert loses.
6. The plaintiff proves damages.
7. The plaintiff proves that your referral was negligent (proves that you knew something about the expert that should have caused you to not refer him).

Like I said, the likelihood of good outweighs the unliklihood of bad, IMHO.

[whandley]

Originally Posted by jvogan

How would "they", whomever they are, be able to have a SU anywhere in the country. Didn't know they had a network like that anywhere, but maybe they do...I really don't know.

Hey Jeff;

You're an ex-police officer, no? The Illinois Governor was arrested with approval of a grand jury for less evidence than is floating around this website. The direction of this association and its business practices are degrading on a daily basis.

Novice and or unknowing inspectors who involve themselves in some of these NACHI programs are going to need a good insurance policy and legal representation in the not to distant future.

Guys! Don't turn yourselves into the likes of subprime mortgage lenders who sold anything and everything to their clients with little or no regard for their well being. Clients hire us to protect them, not be carpet baggers selling them worthless products and services. The down side liabilty to you can be enormous no matter what Nick says.

[whandley]

Originally Posted by gromicko

I doubt if any insurance company would insure you for the opinion of someone else.

However I think that your overall financial liability (after the increase in risk and decrease in risk) is dramatically reduced overall by helping your client to procure the opinion of a licensed expert in a matter such as a possible foundation failure, even if that expert is later shown to be incorrect (something you do not have the expertise to determine ahead of time).

In California, this disaster of a program is specifically called "Negligent Referral".

[Nick Gromicko]

Clients hire us to protect them, not be carpet baggers selling them worthless products and services.

Will, Where do you see anyone telling members to sell anything, much less worthless products and services? Name the actual post #.