Seller Fails to Disclose and Loses $103,366 in Lawsuit

[James H. Bushart]

The SOP saved the inspector, for the undisclosed damages were not readily visible.

It appears that justice can be served.

[Michael Larson]

Originally Posted by jbushart

The SOP saved the inspector, for the undisclosed damages were not readily visible.

It appears that justice can be served.

This is a case against an agent and a deceased seller not an inspector.

[mnahrgang]

I think maybe the point is... Utilizing a good SOP, communicating the limitations of the inspection effectively to the client, and good documentation of defects found may have kept this inspector out of the lawsuit mix to begin with.

From the case, it doesn't even look like the inspector was even considered to be part of it.

I think this might be an example of things working the way they are supposed to from the inspectors point of view.

[James H. Bushart]

Originally Posted by mlarson

This is a case against an agent and a deceased seller not an inspector.

I thought I said that.

In fact, it was a "shotgun" suit that originally included the agent, but the court could find no "conspiracy" and let the agent off.

I am of the belief that a carefully worded and well understood agreement between the buyer and the inspector ensured the clear understanding that areas not readily visible or accessible (under carpet, under exterior covering, etc) and WDI activity kept the inspector out of the shotgun blast.

[Michael Larson]

I saw no inspection firm listed in the defendant list.

I did see this and wonder what they really meant.

Modifications had been made to the electrical systems. The 110 amp service was increased to 220 amps and a 60-amp box was added. These modifications resulted in a demand beyond the capacity of the circuit breakers. It was undisputed that the modifications were not performed by a licensed electrician; and that the work was not properly inspected. Seller had represented that all additional electrical work was done by a licensed electrician

[Jeffrey R. Jonas]

I found this interesting...

The Court is not persuaded that there is sufficient evidence of intentional or fraudulent misrepresentation, or consumer fraud, to permit Buyer to recover under those theories. Seller is deceased and it cannot be determined that Seller acted with the degree of scienter sufficient for a finding of intentional or fraudulent conduct. There was no evidence of a conspiracy between Seller and Agent.

Then what about this...

The evidence demonstrates that there was significant termite damage in several areas of the house. The following areas were not included on the disclosure: damage to the living room floor; decay resulting from infestation of the supports for the roof joists in the sunroom addition; termite damage along the frame of the sunroom and the wall adjacent to the home; and termite damage to framing and sheathing.
Contrary to Seller's Disclosure, the home had neither been inspected nor treated annually for termites.

And this...

Upon removal of carpet, pet stains were found in an upstairs bedroom. These stains could not be removed by sanding. Seller had represented that there had been no animals in the house.

And this...

Although Buyer failed to prove building code violations, there was significant evidence that additions to the home were poorly constructed. Having considered the testimony of the Chief Building Inspector for the City of Newark, the Court finds that Seller did not obtain a building permit or legally-required inspection of the sunroom addition and "wood shop."
Structural defects to the sunroom included inadequate roof supports and door header, and inoperable sliding glass doors and windows. The wood shop had a cracked floor as a result of being built with no foundation, other than bare dirt, and the rafters were rotted and leaking.

Seller had represented that all additions and structural changes were done with all necessary permits and approvals.

Now, given, I am in no sense whatsoever claiming to know squat about the law, but, this all seems contradictory to me.

I am very glad the HI did his/her job including following the SOP. Obviously it saved his/her bacon. I assume the realtor got off the hook, because of the wording in the Disclaimer, and no evidence of collusion.

Thanks for posting this James.

[Michael Larson]

I am very glad the HI did his/her job including following the SOP.

Where is a Home Inspector ever mentioned in this lawsuit?

[Jeffrey R. Jonas]

Originally Posted by mlarson

Where is a Home Inspector ever mentioned in this lawsuit?

Prior to closing, Buyer obtained a home inspection and a termite inspection. The termite inspection revealed visible evidence of termite damage to the door frame around the basement door, located above the hot water heater. The inspector concluded that the infestation was inactive and recommended no treatment.

Seems to me, if the inspector didn't perform his/her dutiy, they most certainly would have been named in the suit.

[Michael Larson]

Originally Posted by jjonas

Seems to me, if the inspector didn't perform his/her dutiy, they most certainly would have been named in the suit.

Thanks Jefff. I read it twice and missed it.

Frankly I'm surprised the home inspector and/or the termite inspector wasn't named in the suit.

We also don't know if there was a separate termite inspector and it seems odd that he did not recommend treatment.

While it's clear that the seller did not disclose and is at fault, I would be concerned as a buyer that the termite inspector did not find much damage or recommend treatment.

[James H. Bushart]

The seller lied and said that it was inspected and treatment was done. It is easier to believe that the seller refused to pay for treatment than to think a man in the business of selling it would not recommend it.

[Jeffrey R. Jonas]

Originally Posted by jbushart

The seller lied and said that it was inspected and treatment was done. It is easier to believe that the seller refused to pay for treatment than to think a man in the business of selling it would not recommend it.

Prior to closing, Buyer obtained a home inspection and a termite inspection. The termite inspection revealed visible evidence of termite damage to the door frame around the basement door, located above the hot water heater. The inspector concluded that the infestation was inactive and recommended no treatment.

Interesting

[Michael Larson]

Originally Posted by jbushart

The seller lied and said that it was inspected and treatment was done. It is easier to believe that the seller refused to pay for treatment than to think a man in the business of selling it would not recommend it.

It would be fun to see the HI and termite report and see just what was reported.

In any case I'm glad justice was done in this case and that the sellers false disclosure was the issue and not some inspectors report.

Living in a house and knowing it's history is important.

As an inspector I only a few hours to find all I can but sometimes your spidey sense does kick in.

[Mark Thorman]

Originally Posted by jbushart

The SOP saved the inspector, for the undisclosed damages were not readily visible.

It appears that justice can be served.

Looking at the list of repairs, I would have included the home inspector and termite inspector in the suit.

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