NY State publishes proposed home inspector COE and SOP for public comment.

[Nick Gromicko]

http://www.nachi.org/documents/nycoedraft2007.pdf

http://www.nachi.org/documents/nysopdraft2007.pdf

[Nick Gromicko]

Gotta love 7 (f) in: http://www.nachi.org/documents/nycoedraft2007.pdf !!!

[John Bowman]

7 (h) isn't bad either.

[Joe Farsetta]

Guys,

You really need to READ some of the proposals to understand what loosey-goosey verbiage means. INDIRECT COMPENSATION and SIMILAR ARANGEMENT can literally mean ANYTHING within the context of 7F.

Does ths mean that if I mentor a group of agents, and the broker likes me, I cannot be put on a short list because I have INDIRECTLY COMPENSATED the RE office, and am on a short list or other arrangement?

[James H. Bushart]

Originally Posted by jfarsetta

Guys,

You really need to READ some of the proposals to understand what loosey-goosey verbiage means. INDIRECT COMPENSATION and SIMILAR ARANGEMENT can literally mean ANYTHING within the context of 7F.

Does ths mean that if I mentor a group of agents, and the broker likes me, I cannot be put on a short list because I have INDIRECTLY COMPENSATED the RE office, and am on a short list or other arrangement?

Loose language can be an intentional move to shift power to the board who will be interpreting it. Don't drop the soap, Joe.

[Joe Farsetta]

The proposed COE is not bad, but much of it already exists within the law, or within other NY State Laws.

Other than this, the following areas within the draft need clarification, explanation, or serious thought:


2A Home inspectors are not permitted to make any statements or comments concerning the adequacy or soundness of the home, its structure or systems and are not permitted to provide engineering or architectural services.

While this statement appears to be pretty reasonable, one needs to ask if an inspector ever comments on the soundness of a system. For instance, we are regularly asked for our opinion on the soundness of a roof, or what condition a heating system or water heater is in. The way in which this statement is written, providing such an opinion enters into the notion of “soundness”. The COE would prohibit us from stating anything other than the roof is present, or the heating system functioned when tested.




4B Home inspectors shall not engage in, aid or abet the unlicensed and/or unlawful practices of home inspections, engineering, or architecture.


This is already stated in the law.


4C Home inspectors who have knowledge of, or a reasonable belief that a provision of Article 12-B of the Real Property Law, or the regulations promulgated thereunder has been violated, shall report the alleged violation to the Department of State or other appropriate authority and shall cooperate with the Department and/or authority in furnishing such information and/or assistance as may be required.


So, now if an inspector fails to turn in another for what he suspects or knows, he is in violation of the COE and can lose his license. This is ridiculous. We are not required, as a part of the law, to police each other or be in violation of law.




4E Any home inspection firm, its employees or any individual inspector shall not install, repair, replace or upgrade for compensation any system or components in any house that they have inspected for a period of not less than 5 years from the date of the inspection.

Existing law already prohibits this practice, limited to what is covered by the SOP, for an indefinite period




5BHome inspectors shall not provide home inspection services beyond the scope permitted by law.


Does this mean that an inspector cannot offer an evaluation of well equipment, perform water quality sampling, perform septic load and dye testing, termite inspections, or radon testing, as it is not covered in the SOP? Would not a better read be something akin to: “shall not offer to perform services where a home inspector is required to be licensed and has no said license”…



7F Home inspectors shall not directly or indirectly compensate, in any way, real estate brokers, real estate salespersons, real estate brokerage companies, lending institutions or any other party or parties that expect to have a financial interest in closing the transaction, for future referrals of inspections or for inclusion on a list of recommended inspectors or preferred providers or any such similar arrangement.

Indirect compensation is a tough concept to get one’s arms around. Most things we do for a real estate off can be considered indirect compensation, including dropping of a coffee cake or box of donuts. All advertising is intended to generate business. Many realtors are not requiring that inspectors participate in programs, such as taking an ad in a realtor magazine, or buying a spot on a realtor website. For that matter, if an inspector’s name s included on a short list of preferred inspectors, nearly anything that inspector has ever done to get a position on a short list, could be construed as indirectly or directly compensating a broker.

[Nick Gromicko]

We're actually working on flipping our SOP so that what we don't inspect is listed first, at the top, much like NY's.

[Robert J. OConnor]

Originally Posted by jfarsetta

The proposed COE is not bad, but much of it already exists within the law, or within other NY State Laws.

I think it's good to have one clear consolidated document HI's can reference as the current provisions are scattered ... even within the existing HI Law.

Originally Posted by jfarsetta

2A Home inspectors are not permitted to make any statements or comments concerning the adequacy or soundness of the home, its structure or systems and are not permitted to provide engineering or architectural services.

I think the intent is that an HI not make statements like "the heating system appears adequate for the house" or "the roof structure appears sound". There is a difference between the condition and the adequacy/soundness of a system or component. It's probably a good provision to keep some HI's out of trouble by avoiding words like "adequate" or "sound", which in my opinion shouldn't be in an HI report anyway.

Originally Posted by jfarsetta

5BHome inspectors shall not provide home inspection services beyond the scope permitted by law.

I don't see that as a problem, since it doesn't state you can not provide services beyond the HI Law ... just the law in general. If you can legally perform private well or radon testing, septic inspections, pool inspections, etc. then it's all good.

Originally Posted by jfarsetta

7F Home inspectors shall not directly or indirectly compensate, in any way, real estate brokers, real estate salespersons, real estate brokerage companies, lending institutions or any other party or parties that expect to have a financial interest in closing the transaction, for future referrals of inspections or for inclusion on a list of recommended inspectors or preferred providers or any such similar arrangement.

Just a restatement of 12B Sect 444-G(4)(c) and 444-F(1)(d) in the current HI Law. If it's problematic, the provisions of the original law needs to be changed.

I agree the COE 4.3(4)(c) provisions on reporting unethical activities are a bit much, as HI's are not the ethics police. But if someone has direct knowledge of say deceptive or unlicensed activities, isn't there an ethical obligation to report that? Also the COE for many professions have similar provisions ... e.g. NYSOP RR Part 29, Section 29.3(a)(1) or NSPE COE Section (II)(1)(f) for engineers is very similar.

And did anyone notice that they added a provision that there must be a written contract with a "scope of services" and a paragraph with specific wording that must be included in that contract under COE 4.3(2)(a)? ... not that this is a bad thing, but what does that have to do with a COE?

On another note, I would have liked to see a section in the SOP with "Definitions"

JMO & 2-nickels ...

[John Cahill]

Originally Posted by gromicko

Gotta love 7 (f) in: http://www.nachi.org/documents/nycoedraft2007.pdf !!!

Ditto

[John Cahill]

I just spent 6 intensive years on ASHI Ethics and Texas Ethics and SoP. You have a lot of good comments here. I am a bit burnt out to work on NY stuff but here is one comment regarding Nicks.

Reversing limitations is an option. The fact is no one reads an SoP until a complaint exists. The limitations often serve to resolve the complaint up front.

Some argue limitations are weasly. I disagree. Complaints INFORM the consumer as effectively as the requirements. IF limitations were clearly stated on all products there would be a lot less misrepresentation.

Limitations are often overlapping. The draft we worked on in Texas (not passed yet) spent hundreds of hours categorizing and word crafting limitations to a very neat and powerful package. SoP writing is very difficult.

Ethics? I hate to say it but Ethics are unenforceable for the better part. They are feel good words. Just my opinion.

[Joe Farsetta]

Rob O,

The reason that comments regarding the soundness of a system is problematic intertwines too closely with the mumbo jumbo in the current NY State Education Law relative to licensed professional engineers.

I have heard rattlings over the past several months regarding PEs wanting to control the HI industry, and claiming that what we are, in fact, doing constitutes the unlicensed practice of professional engineering.

In fact, this very issue goes back more than 2 years, when I spotted problematic language in the (then) proposed law, and predicted it would leave the door open to narrow interpretations by some PEs regarding the inspection process.

No offense, but you didnt think that clause was a problem, either, yet it is the very clause that some PEs are pushing the envelope with. Now we have this latest verbiage, which includes the word "soundness". A reasonable person wants the HI to examine the mechanicals, and actually to render an opinion on soundness. Servicable life, and overall functionality falls under "soundness". If I cant tell a client if something is sound, whet the hell does the client need me for?

As to the ethics police thing, I dont care what PEs do. I am only concerned how members of one HI org, who may want to solence a member of a competing org, can use this loosely written clause to put someone out of business.

It doesnt state that they have to prove you knew something a turned a blind-eye. No. Even if you have reason to believe smething and fail to report, you are in trouble.

So, your license gets suspended pending a hearing, which can take up to 6 months. In the mean time, you cant inspect ****. Even if you are exonerated, your livlihood is dead.

[Robert J. OConnor]

Originally Posted by jfarsetta

I have heard rattlings over the past several months regarding PEs wanting to control the HI industry, and claiming that what we are, in fact, doing constitutes the unlicensed practice of professional engineering.

I haven't heard that rant recently from any agency or organization (other than individual/company marketing fluff). As far as I know thats just older turf battle cage rattling by a minority of PE's (remember our posts concerning NY HI licensing way back) ... which is all moot now with the new HI law. Even before that I am not aware of even one case where the NYSOP came down hard on anyone doing a typical home inspection and report. And the COE is being proposed by home inspectors.

Originally Posted by jfarsetta

The reason that comments regarding the soundness of a system is problematic intertwines too closely with the mumbo jumbo in the current NY State Education Law relative to licensed professional engineers.

I wouldn't touch the terms "adequate" or "sound" with a 10 foot pole unless I did an engineering investigation. You are right that education law associates the determination of things like that with the practice of engineering. This is not something new, and exactly why HI's should avoid that ... no matter what any HI COE does or doesn't state. I think it's better to include that, which may help some HI's from crossing the practice lines and possibly avoid trouble. It matters little in the end as the law is the law.

Originally Posted by jfarsetta

A reasonable person wants the HI to examine the mechanicals, and actually to render an opinion on soundness.

In my mind HI's inspect systems/components to give opinions on the overall "condition" (good, serviceable, satisfactory, marginal, poor, deficient, etc.), which includes functionality. That is consistent with any recognized HI SOP. Some HI's also comment on serviceable life. Those are different from determining if something is "adequate" or "sound". BTW ... do you really use those terms in an HI report ...

Originally Posted by jfarsetta

So, your license gets suspended pending a hearing, which can take up to 6 months. In the mean time, you cant inspect ****. Even if you are exonerated, your livlihood is dead.

Concerning the comments about direct knowledge of ethics violations, I was just pointing out there are similar provisions for most licensed occupations/professions, with just one example regardless if you care about the PE COE. Concerning suspensions, as you said most of the COE provisions are already in existing law (just scattered/unorganized). However under 12B Sect 444-I of the HI Law the NYSDOS can not make a final determination on a license suspension without a hearing if one is requested after service. I think that would be a no-brainer to request.

JMO & 2-nickels ...

[Robert J. OConnor]

P.S. And I am still dumbfounded at the proposed mandatory written contract and mandatory contract wording provisions in the proposed HI COE ...

[Joe Farsetta]

Rob,

Did you mean THIS language?...

"Home inspectors are licensed by the NYS Department of State. Home Inspectors may only report on readily accessible and observed conditions as outlined in the standards of practice. Home inspectors are not permitted to make any statements or comments concerning the adequacy or soundness of the home, its structure or systems and are not permitted to provide engineering or architectural services."

The first section is quite problematic, as it limits what we may comment on specifically to the SOP. Since the proposed NY State SOP is unique in that it BEGINS WITH WHAT IS NOT INCLUDED AS PART OF A HOME INSPECTION, this means that if we go outside of the SOP we are in violation of the COE.

The second section goes directly to my initial objection. Look up "soundness" in your Mirriam Webster. You'd be surprised as to how broad the definition is.

When you combine what's in the COE, along with the SOP.... one has to wonder whether a PE wrote these docs to put HIs under their control or to get rid of the practice altogether.

[jruppert]

According to the proposed language, it will be mandatory for all home inspectors to make the following statement in their pre-inspection agreement:

“Home inspectors are not permitted to make any statements or comments concerning the adequacy or soundness of the home, its structure or systems and are not permitted to provide engineering or architectural services.”

When anybody from the general public sees this language, they could immediately come to the conclusion that anyone except a PE or an architect is not legally capable of performing a home inspection.

Clients will read this language and ask themselves "why am I hiring a home inspector if he's telling me right in his contract that he can't do what I need him to do?"

Even worse, PEs could (and let's face it, there are unscrupulous individuals in every industry) use this language to the detriment of home inspectors for business profiteering purposes. This law would give PEs the ability to launch PR campaigns against home inspectors to steer business their way. As we all know, already, many Engineering firms almost immediately tell prospective customers that they must use PEs rather than home inspectors for a variety of reasons. This law would give the PEs new heavy ammunition to steer business away from home inspectors and towards PEs.

This is a travesty and it must be stopped!