Alberta HI Licensing Legislation Raises Questions

[John Ludlow]

I've spent most of the night skimming through threads specific to the Alberta HI licensing legislation and what I've read with regards to liability raises some questions that I would like to throw out for discusion both from the perspective of a consumer and an inspector.

No matter how good of an inspector you may be, the law appears to put the inspector on the hook for any issue that may arise as long as the house is in existence regardless of when an issue not reported is identified.
- If I buy a house when there is 4 feet of snow on the roof, do I get to hold the inspector (or inspections company as the law states) accountable in the spring for missing flashing, curled shingles and a crumbling chimney? or I guess this would be covered by the fact it is not visible during time of inspection - then what if one side of the roof is partially covered with an inch of snow that would melt and reveal a missing shingle if the inspection were done an hour later once the sun came around a little further? (similar to arguing road conditions were icing during the time of an accident but the road was dry by the time the police showed up)
-If the foundation has no visible cracks during the inspection, but appear any time thereafter, from settling/costruction activity/act of God, and result in leakage/damage, is the inspection company on the hook indefininately for that?
-If a new home is inspected, which had it's rough grade passed, and proper grading is so noted on the report, but subsequently settles to where water is running to the foundation within the first year or two, does this put the inspector on the hook?

The possible list of scenarios could be as long as there are houses in Alberta. I'm interested to hear what is now keeping inspectors awake at night as a result of this clause. I think my biggest fear wouldn't be in something I missed, but in some would-be renovator hacking their home after watching a little too much HGTV and slipping their flooded basement in under the guise of an inspector's missed plumbing issue.

Thanks,
John

[Wand Raymond]

As I suggest some time ago on this site, inspectors should stand together and for a two week period or a month, and refuse to do inspections and call the government to task for imposing a licencing program which is poorly drafted and makes the inspector liable far and above the standards of practice.

Inspectors have much power at their disposal to change that which was foisted on them under false pretenses that the government wanted and sought their input.

Any public hearings and input from inspectors was the government giving lip service only.

The question remains whether or not inspectors as a group regardless of association affiliation have the guts to stand united against poor legislation or are you going to continue to pander to the special interests?

[Rudolf Reusse]

I have accumulated years of experience how real estate is being promoted and sold by the mighty and manipulative real estate fraternity in Canada.

One now defunct Century 21 Realtor instructed his agents in 1976 not to waste more than twenty minutes for each showing - to warm up a bun in the oven to create a homy smell - to select and turn on a radio station which played relaxing music - and to sell the property unconditionally.

Nothing has fundamentally changed. Brokers and their agents still add their disclaimers that they do not assume any responsibility for the accuracy of their listing information provided. Now they even suggest in fine print that it is the sole obligation of the purchaser to confirm that the provided property description is actually correct. Suggesting a pre-purchase home inspection keeps them virtually of the hook all together.

The demand to have home inspectors governmentally regulate did certainly not come from the public. The idea came originally from home inspector associations who are also heavily engaged in the education business. Local Real Estate Boards, and CREA have jumped on the bandwagon to protect the interest of its members. Home inspectors - and their insurance providers - are now first in line to be sued whenever a home buyer feels mislead. The current E&O insurance requirements for real estate agents proves my point.

RUDOLF REUSSE - Home Inspector since 1976 - Retired

[John Ludlow]

I get a sense that Home Inspectors may be stuck between rising up against the legislation and needing to pay their bills. While some stand in protest, others will be out there grabbing up more business. Seems to be a no-win situation.

Maybe the best protest would be for all inspectors to create reports that spell out nothing but doom and gloom on every home they inspect. Your house was built in Alberta by unregulated, shoddy, fly-by-night contractors and recently renovated by a family of baboons - your roof will blow off in the fall, you pipes will burst when use your bathroom, your house will catch fire when you plug in your 50" flat screen, mold will creep up from your basement and choke you in your sleep, your foundation will crack and your basement will flood while you are on vacation... enjoy your new home.

This would also be a wake up call for Real Estate agents when their clients take off running.

John

[Wand Raymond]

Just remember at least one Canadian association attempted to have CREA do its dirty work in order to have home inspectors licenced under the guise of betterment of the profession.

You should all breath a sigh of relief at least in Ontario the plan backfired.

Realtors and their respective associations should never ever influence any licencing schemes for home inspectors!

[Greg W. Mathias, CCHI]

The contract is the only thing protecting us now. The problem with our contract is that the government got there hands on that and strangled it too. We are allowed to write in non inspected items like the shingles or the foundation but they have to agree to it before the inspection. When we get onsite and there is somthing we cannot see we have to rewrite the contract and have them sign the revised. What a pain in the a**. If it is not in the contract you could get sued. I just hope that a judge will see that we could not see the foundation or the roof and judge fairly. That is what lets me sleep at night.

[Wand Raymond]

Don't count on the judge to protect you, the legislation sets a new standard of care and you will not be able to rewrite the contract on site as that could be argued successfully by the purchaser that they were under duress at the last minute to sign the contract without the ability of the client to find another inspector because he does not like your newly added disclaimers.

[Daniel W. Levia, CMI]

Originally Posted by Wand Raymond

Don't count on the judge to protect you, the legislation sets a new standard of care and you will not be able to rewrite the contract on site as that could be argued successfully by the purchaser that they were under duress at the last minute to sign the contract without the ability of the client to find another inspector because he does not like your newly added disclaimers.

Oh well, no sleep again tonight.

[Greg W. Mathias, CCHI]

Originally Posted by dlevia

Oh well, no sleep again tonight.

DITTO, DAMMIT

[Vern Mitchinson]

Ray is right about the courts ruling contracts invalid because the client should have three days to decide if the contract is acceptable. However this government, not knowing how our business works, decided that all items to be inspected and all items not to be inspected had to be listed and signed by the client. They made this the law so where will the judges decide to go. Will they go with precedent or will they go with the new regs. Factor in the reluctance of the insurance companies to defend their clients, the HI, leaving the HI on the hook for everything.
You can always do what I did and that is shut down my HI business.
To follow up on the strike suggestion, consider instead do not do inspections for consumers that are going to buy to live in and only do inspections that are not covered by the regs. The only inspections that have to be licenced are the one for buyers that are buying to live in the property. all other buyers such as renovators, investors, landlords, etc. do not have to hire licenced inspectors.

[Wand Raymond]

Hey Vern,

Do you think pre-listing/pre-sale inspections would be exempt from the rules? That may be the alternative to this whole mess. After all the owner is living in the premises and can not be considered to be a purchaser.

Your contract can state the inspection is for the sole use of the owner. I would not even provide copies of the report for the owner to give to potential clients if and when he decides to sell.

[Roy D. Cooke, Sr]

From what I hear you are not the only one to stop doing inspections .

If this gets fixed properly I expect many might come back.
I feel sorry for those Active Homies in Alberta .
I wish every one the best and do appreciate any thoughts ideas or information you have.
I have a meeting this fall in Ont. and would like to be fully prepared .
You Can send me email if you want your name will not be mentioned .
Unfortunatly some HIs and Associations In Ontario are trying to help them selves not the our industry . Roycooke@hotmail.com Phone 613-827-2011

[John Ludlow]

Does the new legislation specifically state that or can it be interpretted in that manner?

As a novice landlord, I may want a property I'm buying inspected; as a renovator, I would do the inspection myself since I'm going in to fix what needs to be fixed anyway (if I'm a good renovator); as an investor, unless I'm holding to rent, I typically wouldn't care about an inspection before flipping a house to a rehabber. So what kind of market does that leave the HI to feed off of?

[Rudolf Reusse]

The reality is that real estate agents are charging about $20,000 for each selling transaction these days in Toronto without little risk or responsibilities. Home inspectors who are operating in Alberta are now being forced by their government to expose themselves to even more potential lawsuits for the pittance of a few hundred dollars per inspection. In the meanwhile the conniving real estate "profession" can continue to use all tricks of the trade to achieve a sale.without governmental interference whatsoever.

[John Ludlow]

So all home inspectors in Alberta should now begin charging a minimum of $20,000 per inspection and accept all liability (since they have no choice) with the caveat that any issue an inspector misses will be rectified by the inspection company. I don't see anything in the legislation that caps the inspection fee or prevents the inspection company from committing themselves to owning the repairs against what they have certified as ok - since you can't limit your liability in your contract, and you are wholly responsible, why can't you be the one responsible for the repairs instead of some insurance-contracted company with overinflated quotes? Mr. Home Buyer, your roof should be good for another 3-5 years, but for your $20,000 fee, if it leaks before then, I'll be back with a truckload of shingles. This will keep everyone out of court and let the insurance companies breathe a sigh of relief.

People are willing to pay Real Estate agents so much for doing so little, but cringe at having to dish out a few hundred bucks to make sure they are buying a sound investment. Where's the logic? It would make the most sense and be fair if the commissions were split between the agent and the inspector and the agent accepted the responsibility for the product they are selling - the inspector didn't build it, renovate it, live in it, abuse it, or sell it.