Thread: Local News Story

Here is a link to a local news story here in MN. Comments?

Homeowner Calls for Change to State Law for Home Inspectors | KSTP TV - Minneapolis and St. Paul

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Always two sides to the story! Sounds like she didn't read or maybe understand the report, and didn't call to ask questions, or complain till after the fact.

again i say having a license doesn't make you a good driver--real estate agent-dentist-lawyer-butcher-home inspector-etc

just do your job with you as the buyer and what you would want--and maybe stop doing to many inspections a day to make money and screw your client--home inspecting is not how much money you can make--it his serving a client that knows nothing about owning and caring for a house--

make believe it is your daughters house

cvf

Too little information in the story, which is typical of the media trying to do a "hit piece". And as all of us know, licensed people in any trade can be incompetent, so licensing isn't any kind of solution to fixing incompetency. Based on the tiny bit of information in the story, I didn't see anything that convicts the inspector of incompetency or missing something in his inspection.

The "reporter" should have asked the buyer for her copy of the inspection and compared it to the defects that she claims the inspector missed.......and then interviewed the inspector, but that kind of work might have missed the 5-o'clock news for the day.

Do I sound like I have a low opinion of main stream media?......I sure hope it does.

As HIs we have a relatively small voice. Mainly, it's just a numbers game - there just aren't that many of us out there. I was talking to a fellow inspector at a conference once and something he said I always remember. Basically, your state or local area is just one bad inspection on a local politician's house away from a bunch of new legislation. Kind the whole "not what you know but who you know" idea.

In a nutshell - if Sally Nobody gets a bad (or perceived to be bad) inspection nobody really cares. If Sally Nobody happens to be the daughter of a state legislator we'd be amazed how quickly new laws can come rushing downstream.

If I remember right the guy I talked to was from Colorado and there was a heap of new legislation because of something that happened in a local politician's house - it wasn't a bad HI - I think it was CO poisoning or something like that. Anyway the OP's news story made me think of that since that story could easily pass with no one caring.

Its apparent many purchasers are illiterate when it comes to reading a contract.
Its also apparent that the lady is probably not the sharpest knife in the draw with her unfounded comment 'all inspectors are bad'. She should have been a painter!

One little thing I noted was the body language of the home inspector during the interview. Folded arms. Thats a defensive posture.

Also for those nay sayers who think home inspectors have a large dossier of complaints. The stats don't back up that theory.

2010 Complaint and Inquiry Statistics - Canadian BBB

This case the client failed to read the contract and the report, demonstrated by making repairs that might have been covered by the HI. Broken seal on window begs the question of when the inspection was don and the interior/exterior temperatures that day. The fact that there was no law suite demonstrated that the homeowner had no real basis for a complaint else they would be in court. Instead, with no factual/legal basis to complain, she goes to the media for some hyped up media justice. To many buyers fall in love the property and develop hearing and sight loss about the property.

The reporter probably just showed up on the HI's door steep for an interview. His posture could have been better along with a better control of the interview, not to mention changing his shirt for a more professional appearance. But possibly he was just mot prepares for being blindsided by an interview that day.

Originally Posted by Matt Fellman

If I remember right the guy I talked to was from Colorado and there was a heap of new legislation because of something that happened in a local politician's house - it wasn't a bad HI - I think it was CO poisoning or something like that. Anyway the OP's news story made me think of that since that story could easily pass with no one caring.

Basically correct. A wealthy family or most of the family, died of CO poisoning from an improperly installed boiler flue at a getaway home up in the mountains. They were well connected and a few months later we had a mandatory law concerning CO detectors.

Originally Posted by Lon Henderson

Too little information in the story, which is typical of the media trying to do a "hit piece". And as all of us know, licensed people in any trade can be incompetent, so licensing isn't any kind of solution to fixing incompetency. Based on the tiny bit of information in the story, I didn't see anything that convicts the inspector of incompetency or missing something in his inspection.

The "reporter" should have asked the buyer for her copy of the inspection and compared it to the defects that she claims the inspector missed.......and then interviewed the inspector, but that kind of work might have missed the 5-o'clock news for the day.

Do I sound like I have a low opinion of main stream media?......I sure hope it does.

Agree. This is simply bad reporting! If anything, all inspectors should write to the reporter demanding a followup story with accurate information, not just the rantings of a woman who obviously was being told what to say! I'm curious which family member or contractor "bashed the inspector".

I have discussed this 'story' with a couple of local inspectors over the weekend, and we agree... we all need to pay attention to this. Even though this could be a 'nothing' story, this could also be the 'warning shot' that most claim to never see coming.

She fixed the problems before she called the inspector. Sounds fishy to me. One time I had a situation where a conversion to a garage was done without permits. They moved the water heater & installed an improper vent. I caught it an reported it. Probaly why the water heater was not lit when I got there. Plus there was a problem with the furnace. The wife was in love with the house & did not care about anything wrong. A few days after they moved in I get a phone call from her that It's going to cost over $2000 dollars to remedy the situation & wanted to know who was going to pay for it. My answer was not me. I told her that I verbaly told them about it when I was there & I reported it. It turned out the gas company would not light the water heater untill the situation was remedied.

Woodbury, MN...pretty much non-existent until 25 years ago when developers started filling in swamps and building sub divisions. 70% of the inspections I've done out there have significant structural problems. Builders used the cheapest materials and building techniques. The building officials allowed substandard footings (admitted to me by the head AHJ). I've seen many of these houses flipped with granite counter tops installed, causing the floor joists to bow and center bearing wall footings sink. The house was most likely a foreclosure, inspected with the house winterized, something I personally won't do.

I'm surprised there was only "thousands of dollars" in repairs and not tens of thousands of dollars.

Hopefully those couple sheets of paper the inspector was waving around wasn't the inspection report he was referring to. But, I've seen a ton of two page checklist reports lately so it wouldn't surprise me. I've also heard that most inspectors tell the client not to come to the inspection, or only come at the end. Bad business practice as the client has no idea what you've inspected or how long you've been there. Many inspectors have been caught showing up at 1:30 for a 12:00 inspection with the client scheduled to show up at 2:00 and they've magically completed the inspection in a half hour.

I would also guess that the inspector doesn't carry insurance, otherwise he would have just turned it over to his insurance company and this wouldn't make the news. Since there's absolutely no regulations on home inspectors in MN most inspectors don't carry insurance. Personally I think it's bad business practice not to carry insurance. I've been instructed by my insurance company, if I ever have a claim (whether it's in or outside the scope of my inspection agreement) to turn it over to them immediately. Don't go back to inspect the issue or have any contact with the client. They'll handle it completely.

Personally I agree there should be some sort of regulating of home inspectors. Maybe not licensing, but something that forces them to have E&0 and Liability insurance and the passing of a standardized test such as the NHIE. Since you can't really do inspections here without being an Associate member of a Real Estate Association, maybe the associations should get together and require these items from the inspector in order to gain association membership? Just a thought; but most RE agents already believe we're licensed.

I've been instructed by my insurance company, if I ever have a claim (whether it's in or outside the scope of my inspection agreement) to turn it over to them immediately. Don't go back to inspect the issue or have any contact with the client. They'll handle it completely.

Thats interesting perspective. Can't say I agree with that advice, however in relation to handling complaints here is a good read from an insurers pov.

Working Real Estate Magazine - Home Inspector Edition - Spring 2013
Working RE Home Inspector Edition/Spring 2013

Rebutting Complaints page 12

Inspectors: What to w/claims page 29

and

WRE Online

Originally Posted by Ken Rowe
........ I've been instructed by my insurance company, if I ever have a claim (whether it's in or outside the scope of my inspection agreement) to turn it over to them immediately. [B

Don't go back to inspect the[/B] issue or have any contact with the client. They'll handle it completely.

...........are you kidding?? And then the insurance company settles for whatever your deductible is and you're out of luck (and money). Now that's an example of poor business practice..........Greg.

Originally Posted by Gregory Booth

...........are you kidding?? And then the insurance company settles for whatever your deductible is and you're out of luck (and money). Now that's an example of poor business practice..........Greg.

I have a no deductible policy so it doesn't really matter to me if they settle or not.

I pay about $18/inspection so my insurance cost per year is about $5400. Not the cheapest, but as the saying goes, you get what you pay for. When I first opened for business I spoke with my insurance rep to find out what they needed if I were to file a claim. They had me speak directly to the adjuster.

He told me that I I ever received a claim to contact them immediately. Keep my initial contact with the claimant short, not admitting fault or apologizing. Just tell them that I would turn it over to my insurance company and to expect contact from them in a few days. Once the claim is made to the insurance company they would send out their investigator to look at the claimed item. He would also review the inspection report and agreement to determine if the inspector had any liability.

Here in the Twin Cities we have what's called Time of Sale, or Truth in Housing inspections. Basically several cities require an inspection be performed prior to a home being listed for sale. These are not home inspections and are basically a checklist of items each individual cities require. These inspectors are required to be licensed by the individual cities and carry E&O and Liability insurance. There is only one place to get this required insurance, the Minnesota Joint Underwriters Association. This is where I get my insurance. They insure hundreds of inspectors performing these time of sale inspections, so their investigator works full time investigating nothing but inspection claims.

I'm not saying you should handle claims this way or follow the advise of an online magazine. What I am saying is carry insurance and contact your insurance company and find out how they want you to handle claims.

Found on a home inspectors web page from my area.

How not to advertise you are insured.

Our company carries Errors and Omissions and Liability Insurance, whereas many home inspectors are not insured at all.

We recommend that no one ever use an uninsured inspector. 85% of Home Inspectors are not insured. A (name of company and area removed) is.

Remember insurance is for the inspectors protection not the consumer!

Originally Posted by Raymond Wand

Found on a home inspectors web page from my area.

Remember insurance is for the inspectors protection not the consumer!

It could be argued and some do argue that insurance protects consumers from HI mistakes.

Well... they could argue that but on the other hand the aggrieved party must still file a claim and its not always an automatic payout while other times as argued on this forum there is a payout by the insurer due to financial reasons. However, with the strong likely hood of going to court for a 50-50 chance of winning or losing. So the aggrieved party still has the expense of legal representation and other associated costs.

Such advertising makes something complex sound simple and pass 'GO' and collect.

Then there is the arguement that insurance is a warranty for the consumer which its not.

I also thought this was an interesting take from an ethical point of view from a P.Eng society ethical ruling.

Similar circumstances with an Engineering company stating they are insured and other engineers are not as noted in my earlier post by this local inspector.

Here is the Ethics ruling on the matter.

Facts:Engineer A sent a letter to various state and local public agencies in his area of practice as follows:

"It has come to my attention that your agency has been using the services of engineers who do not carry professional liability (errors & omission) insurance. Such a practice, although not necessarily a violation of policy, is certainly not in the public interest. No one plans on mistakes, but if a costly error does occur, it is not likely you can recover losses from the personal or corporate resources of an uninsured consultant.

There are only two reasons a consultant is not covered by professional liability insurance.

1. The individual does not care to accept the expense of such coverage.

2. He is uninsurable due to past experience.

For those in the first category, the premium amounts to three to five percent of gross income. These persons are either receiving excess profits or they are billing at lower rates than those who carry the insurance.

There are several qualified consulting firms in the area who carry adequate liability insurance; it is not necessary for your agency to risk public funds on the possible errors or omissions of an uninsured engineer. My solo practice is covered by $500,000 general liability and $500,000 professional liability insurance. In over four years of operation, I have not had a failure nor a claim filed against me. This, despite the fact much of my work is in the high risk areas of excavation support and landslide stabilization. Doesn’t it make sense to go with a winner?"

Question: Did Engineer A act ethically in using the quoted letter as a means to promote his practice?

References:Code of Ethics-Section 1(g)-"He will avoid any act tending to promote his own interest at the expense of the dignity and integrity of the profession."

Section 3-"The Engineer will avoid all conduct or practice likely to discredit or unfavorably reflect upon the dignity or honor of the profession."

Section 11-"The Engineer will not compete unfairly with another engineer by attempting to obtain employment or advancement or professional engagements by competitive bidding, by taking advantage of a salaried position, by criticizing other engineers, or by other improper or questionable methods."

Discussion:We considered a related situation in Case 73-8, involving a promotional letter casting doubt upon the ability and competence of other engineers in an engineer’s area of practice. In concluding in that case that the engineer’s promotional letter was unethical, we noted that the mandate of §11 extends not only to individual engineers, but also to "a group of engineers or the engineering fraternity in general." We further commented, "It is a fair reading of §11 in totality to arrive at the belief that its broad thrust is to hold competition among engineers to a plane of dignity, respect and honor. Here those virtues were breached by a self-serving statement which tended to degrade the entire profession." And we alluded to Case 65-17, recognizing that engineers may promote their services through direct mail solicitation if the material utilized is "dignified and circumspect," the applicable standard then prevailing.

The facts before us are even more offensive than the letters in the earlier cases. Here the engineer is not only indulging in self-serving statements, but is trying to capitalize on allegations which may or may not be true regarding other engineers carrying certain insurance. Whether or not an engineer carries professional liability insurance, or any other kind of insurance, is purely a business decision for him to make, and the failure to carry such insurance, for any reason, is not an attribute of professional standing or competence.

While it is not controlling on us, we note that NSPE Professional Policy No. 75, as quoted in full below, makes the specific point that the carrying of professional liability insurance should not be used for promotional purposes.

"Professional liability insurance, as endorsed by NSPE, is intended to protect the interests of professional engineers, who, in the course of their practice, may be subjected to claims or lawsuits alleging negligence in the performance of professional duties. This protection is not intended, and should not be used, for promotional purposes in any way. It is improper to indicate on letterheads, brochures, or otherwise that such insurance is carried by the professional engineer.

"Carrying of professional liability insurance should be a personal choice of the professional engineer. NSPE is opposed to the adoption of laws or regulations which require a professional engineer to carry such insurance."

We recognize that in some instances clients may insist that the engineering consultants carry professional liability insurance in stated amounts, contrary to the NSPE policy. That is a judgment for the client to make, and a judgment for the engineer to decide whether he wishes to comply with that condition. It is manifestly unfair to state or imply that an engineer who does not carry such insurance is incompetent or wishes to dodge his responsibilities. The failure to carry such insurance as a business decision in no way protects the engineer from legal proceedings or judgments if he performs his services in a negligent manner.

In addition to the clear restriction of §11, we think that the cited letter directly offends the principles of §1(g) in that such unsavory methods to promote self-interest do so at the expense of the dignity and integrity of the profession.And likewise, §3 clearly proscribes this type of practice as a sad reflection on the dignity or honor of the profession.

Conclusion:*Engineer A did not act ethically in using the quoted letter as a means to promote his practice.

*Note: This opinion is based on data submitted to the Board of Ethical Review and does not necessarily represent all of the pertinent facts when applied to a specific case. This opinion is for educational purposes only and should not be construed as expressing any opinion on the ethics of specific individuals. This opinion may be reprinted without further permission, provided that this statement is included before or after the text of the case.

Board of Ethical ReviewWilliam J. Deevy, P.E.; William R. Gibbs, P.E.; Joseph N. Littlefield, P.E.; Donald C. Peters, P.E.; James F. Shivler, Jr., P.E.; L. W. Sprandel, P.E.; Robert E. Stiemke, P.E.; chairman

Raymond,

What I'm taking from your previous post is that you agree that some sort of oversight is necessary in the profession of Home Inspections, similar to what is done with Professional Engineers. As you know from reading this thread, there is no oversight in MN (where I am and where the subject of this post is from). So even if there was an ethics complaint regarding a home inspector there is no one to complain to.

So in order for your post to have any bearing on this thread there must first be some sort of oversight for home inspectors in MN. I could write a letter similar to the one described in your post, send it to every single person in MN and there is nothing anyone could do about it. I'm an ASHI member, so what...they revoke my membership and I keep inspecting because I don't need it to work here, plus I save $400 a year in dues.

Ken,

Even where there is an "oversight" mechanism or board.....so what. Some inspector harms a client, and the client complains to the oversight board and the inspector gets his/her hand slapped, fined, or suspended.......how is the client helped?

An oversight board is nothing but a warm fuzzy feel good mechanism to fool the public into believing that they are somehow protected from incompetent or worse practitioners. I know of one crummy deceitful contractor that lost the license he was working under four times. Each time, a week later he was back in business with a new license that he got under another person's name. Finally a lawsuit, pursuit by a TV consumer advocate, and a criminal charge stopped him........for his three month jail term.

This discussion reminds me of a time I special ordered a set of tires at Discount Tire. When the tires came in, I made an appointment that afternoon to have them installed. When I got to the store, I was informed that another store had picked up the tires for a customer they had. The manager told me that he had really yelled at the other store manager. I calmly asked him how that helped me. After a long pause, he told me I could have any set of tires in the store. An oversight board can't make that offer to a harmed person, they can only tell us how they yelled at that crummy inspector.

For a harmed person, the recourse for recompense remains in the courts. Licensing and an oversight board with penalty powers, does nothing to help that harmed person. Nor can such a board stop anyone hell bent on continuing to work. Of course, even a court judgment won't necessarily result in recompense if the defendant refuses to pay, but the courts are still the only viable option to try to get compensation.

In my experience self regulating home inspector boards may be able to impose fines if legislated to do so, but they still must have a hearing and find the respondent in breach of the SOP/COE or vindicate him/her of blame. If in breach they can impose a fine, that is due process. But again the body is not adjudicator in ordering compensation for the plaintiff.

However the buck stops in most cases with the courts and that will continue to be the case.

Dependent on ones pov at the end of the day the consumer is protected.

Lon,

I totally agree with you. I was just trying to comprehend Raymond's comparison of a regulated profession (Professional Engineers) with a profession which is unregulated in MN (home inspectors). In my mind the comparison can't work unless there is a somewhat level playing field.

Raymond,

By your last post it appears you are stating the consumers are protected by the courts, not an inspector's insurance. If that is the case then why do doctors have to carry malpractice insurance...is that to protect the doctor? Why am I required to carry automobile and homeowner's insurance? Is it to protect me? I contend that my insurance not only protects me and my business but also my clients. Just as malpractice insurance helps the injured patient. Just as my car insurance helps someone injured due to my bad driving. Just as my homeowner's insurance helps the person who slips and falls on my icy sidewalk.

You can choose to disagree if you wish, but I still contend that if the inspector, who is the subject of this thread, would have turned the claim over to his insurance company this would not have made the news and given him and other inspectors bad publicity.

Ken

I do see your point, but I think any insurance industry person would be quick to say that the insurance is for your protection.

As with auto and malpractice insurance, again it protects the driver or the doctor. The plaintiff has to wade through a myriad of hoops in an attempt to get the money and even then its a crap shoot because the buck will stop at the feet of the court to decide which side has merit. Even then if the plaintiff does not succeed they are going to be on the hook for costs. In which case the only winners are the lawyers, and you may be left with no insurance at renewal and/or higher premiums.

Time frame could be two to three years for a resolution.

I fail to see how that aids the client in the interim whilst they live in a house that they claim the inspector was negligent in providing a diligent inspection.

As to P.Eng I wasn't attempting to compare what is happening in Mn. I was comparing what an inspector has on his website with what the P.Eng ethics committee ruled with a similar situation where an P.Eng knocked the competition.

Raymond,

I don't know if its different in Canada, but here in the States most insurance claims are paid without even a hint of going to court. When my wife was involved in a car accident last year, we didn't have to go to court. Insurance paid within a week. I'm sure it would be different if the claim was for tens or hundreds of thousands of dollars, but remember the topic of this thread...we're not talking about tens or hundreds of thousands here.

As to P.Eng I wasn't attempting to compare what is happening in Mn. I was comparing what an inspector has on his website with what the P.Eng ethics committee ruled with a similar situation where an P.Eng knocked the competition.

Then I don't see the point of why you posted it. It has nothing to do with the topic of this thread.

Ken

You may not have thought the post regarding the P.Eng was appropriate for the thread but I did, and I sure many others found it of interest and relative as it relates to insurance and law suits.

As to insurance perhaps that is the problem as it relates to home inspections - payouts have become routine and have evolved into a warranty program, thus you have peeved clients as with the original news story launching lawsuits in an attempt to collect monies.

Originally Posted by Raymond Wand

As to insurance perhaps that is the problem as it relates to home inspections - payouts have become routine and have evolved into a warranty program, thus you have peeved clients as with the original news story launching lawsuits in an attempt to collect monies.

Raymond,

Again, here in the US people don't have to launch a lawsuit to file an insurance claim. You also stated "payouts have become routine and have evolved into a warranty program". I claim this is beneficial to the client if they are wronged by the inspector. Common sense dictates here.

I'm not saying it's right or wrong that the insurance has evolved into a warranty program, but agree that it has and it's beneficial to the clients. They have recourse against the company that wronged them.

So if a client has a choice between two inspectors, everything being equal except one carries insurance, they are better off choosing the inspector with the insurance. With insurance the client has the chance of collecting damages for something missed by the inspector without going to court (with all the costs associated with it).

Think about everything you've read. All the lawsuits and bad publicity against home inspectors. How many of those carried insurance? I don't remember a single one.