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Thread: Dilemma...

  1. #1
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    Default Dilemma...

    I performed a HI a few weeks ago on a newer $500+k tract home but the purchase ultimately fell through. This was a short sale on it's way to foreclosure. I discovered and reported several issues (A/C, broken roof tiles, broken window etc.)

    The realtor acting for the buyer is a friend of many years. As a Handyman I have done several repairs for her at some of her rental properties and she has referred me to many of her past clients, for whom I have also done repairs and installations. She has also referred other inspection business to me.

    Upon completion of the inspection I asked the realtor to forward my report to the buyer, which she did. However, the deal fell through because, in part, of the issues I reported, which would have presented a financial hardship to the newly-wed buyers to fix. The realtor retained a copy of the report for the 'house file'.

    The realtor has now had several 'new' clients and because of the urgency in attempting to close the sale before the short-sale deadline, has provided copies of my report (I believe, without the original client's knowledge) to these new prospective buyers. She may also be using it as a 'selling tool'. At least one, maybe two, of these new buyers are now making offers on the home, using/relying (on) my original report for negotiating purposes. None of these prospective buyers have contacted me, engaged my services for a new inspection or to review the original report.

    I have had no cause to return to the property. Furthermore any recent buyers are not privvy to the additional information, communications and original photographs, which I shared with the original clients. So the report they have in hand is, to some extent, incomplete.

    I know I have no fiduciary responsibility to anyone using my report (to engage in their own contract). I did explain to the realtor that the information in the report was only 'good' for the time of the inspection and that I could not be held accountable for the condition of the property since that time. I also explained that the report was a contract between myself and the original client only. I also said I would gladly do a re-inspection on behalf of any new clients but they (obviously) are looking to save $$$ by not having a new inspection. I would appreciate anyone's advice or thoughts on the matter. Cutting ties with the realtor is not an option, though I am a little PO'd to say the least.

    ip

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  2. #2
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    Default Re: Dilemma...

    Ian,
    I would question that you have given tassit approval if you know that the Realtor is providing your report to others, that it is being used as a marketing tool and that others may be relying on that (incomplete) report. If by you taking no action to re-mediate the use of your report, could you not be liable for their reliance on what has been presented to them. Again it is about your knowledge of the use of the report and not making an attempt to correct the situation. I bet the buyer that paid you for the report must be happy that the realtor is using their money. Especial since they are cash strapped.

    You say ..." Cutting ties with the realtor is not an option, though I am a little PO'd to say the least."... You are making the bed that you will lay in.


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    Default Re: Dilemma...

    This kind of crap goes on all over the country every day of the week.

    You are not liable in anyway, providing you have the usual disclaimers in the report.

    The home buyers who use your report take a chance to save time and money. If the realtors had any conscience or guilt feelings, they could reimburse your original clients, who walked away. But even that does not concern you at this point.
    Your clients paid for and received a service. The realtor, by passing on the report to a third party, takes on the liability. IMO. (But I'm not a lawyer. )

    Now if someone other than your client called you to discuss your report findings, then things get complicated. Maybe then, you could offer to consult with them for a fee. But I would then need to call my original clients first to clear it with them, just in case they are still in the loop for the house. Best practice is to avoid working for two parties, IMO.

    Last edited by John Kogel; 03-13-2011 at 09:34 AM. Reason: added comments
    John Kogel, RHI, BC HI Lic #47455
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    Default Re: Dilemma...

    What makes you think that the agent has provided your report to other clients?

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    Default Re: Dilemma...

    Quote Originally Posted by Garry Sorrells View Post
    Ian,
    I would question that you have given tassit approval if you know that the Realtor is providing your report to others, that it is being used as a marketing tool and that others may be relying on that (incomplete) report. If by you taking no action to re-mediate the use of your report, could you not be liable for their reliance on what has been presented to them. Again it is about your knowledge of the use of the report and not making an attempt to correct the situation.
    I'm not a legal expert but I disagree. I don't see any legal action that could be pursued. If there was, this would not be as big an issue as it is everywhere in the country.
    Garry what actions have you take when your reports are passed on to new buyers?

    Jim Luttrall
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    Default Re: Dilemma...

    If this realtor is really your friend, then you should be able to have a conversation with her about your concerns so you can find out if she really is sharing your reports with other buyers. And a friend would understand your concerns and respect your wishes. But if you say that cutting ties with her is not an option ($$$), then you are pretty much stuck with allowing her to share your reports if that's what she wants to do.

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  7. #7
    Ted Menelly's Avatar
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    Default Re: Dilemma...

    Passing the report on to possible buyers is nothing more than disclosure of concerns on the property. She has you findings in hand. She must disclose these findings. Handing them the report or just disclosing the findings is no different as the findings are in the report.

    I would blow that part of it off.

    What I would be worried about is a far grater concern than info in a report being passed on.

    I would be seriously concerned with the fact that you

    Get referrals from this Realtor

    Do work on homes that you have inspected ... any work, for homes that you have inspected thru this Realtor (and any others)

    Not only all of that which has serious implications in and of itself if someone wishes to bring you to court someday .... but you also depend on part of your livelihood form this same woman (Realtor) and others I am sure, as a handy man.

    You are way to "In Bed with all your Realtors" involving yourself professionally and almost if not personally. You are way to involved with any kind of work other than home inspection with your home inspection clients.

    Quite frankly I have never heard of anyone being so intertwined "In Bed With" Realtors to such an extent or even the slightest.

    I am willing to bet you are a very busy home inspector

    Such deep rooted involvement, doing work for clients after the home inspection, performing handyman work directly for Realtors that are referring you implying that there is way, way to much influence going on there. After all, she gives you way to much work to question her about anything with a possible loss of referrals, clients handyman work tyou get from it and handyman work you do directly thru her.

    I know you have discussed this before on this site and say that you are covered legally.

    I have one huge question. Who the heck ever told you of such a thing. I have never in my decades of doing this heard of an inspector in bed with Realtors so deep and jeopardizing his profession by performing any kind of work for a client on a home they inspected. I have heard of countless home inspectors being bashed about the head by judges for far less than everything you just disclosed in one posting on a thread.

    Now of course these are just opinions so don't take it as me bashing you .... just be a bit more careful for your own sake.


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    Default Re: Dilemma...

    Quote Originally Posted by Ted Menelly View Post
    What I would be worried about is a far grater concern than info in a report being passed on.

    I would be seriously concerned with the fact that you

    Get referrals from this Realtor

    Do work on homes that you have inspected ... any work, for homes that you have inspected thru this Realtor (and any others)
    Ted,

    Can you point out to us where Ian said he does work on homes that he has inspected? I don't see it in the OP.

    Quote Originally Posted by Ian Page View Post
    The realtor acting for the buyer is a friend of many years. As a Handyman I have done several repairs for her at some of her rental properties and she has referred me to many of her past clients, for whom I have also done repairs and installations. She has also referred other inspection business to me.


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  9. #9
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    Default Re: Dilemma...

    Quote Originally Posted by Bruce Breedlove View Post
    Ted,

    Can you point out to us where Ian said he does work on homes that he has inspected? I don't see it in the OP.
    I just read into it as he has posted in the past that he works on clients properties quite often .

    I guess I should nt assume but I do not believe there was an assumption based on past posts.

    If I am wrong I apologize but realty nothing to apologize for as the closeness to his Realtor/s and getting continuous referrals from and acting in other trades from and thru those Realtors puts him in harms way.

    The matter of influence is without question, whether he does nothing wrong or not. One that supplies you with referrals and handyman work on that same persons rentals as well as clients and past clients is looking for trouble.


  10. #10
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    Default Re: Dilemma...

    Bruce,

    Ian has stated in past threads that he does, indeed, do handi-work, repairs and improvements on homes he has inspected. There were long exchanges made with him in those threads by several posters. He mentioned that he has no problem with replacing a toilet or installing a fence or gate, when the work he does was not associated with the conditions he found on the property, and stated that he felt he was not doing anything contrary to the CREIA SOP's, Ethics or the Calif. B&P Code. You will need to do your own review of those threads for the particulars.


  11. #11
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    Default Re: Dilemma...

    I truly appreciate everyone's thoughts and comments. The RE Agent called me several times, advising me of her passing on the report and to expect a call or two from the 'new' buyers or their agents.

    Ted, you are mistaken with regard to your interpretation as to my combining one aspect of my business with another. I have a few more scruples than that, a healthy respect for Ca. Business Licensing laws and very good legal counsel. Please re-read my previous explanations. Yes, I do do work on clients properties. It is NOT repair work (which is precluded under CA Business Regs) but may be 'replacements, installation or improvements' which ARE NOT precluded. Only under CREIA, ASHI and InterNashi's s.o.p. are they denied - but I am not a member of either for that very reason.

    The Handyman work I perform is no different than a GC, building and remodelling homes and providing Inspection services - just that my (Handy) work is on an infinitesimally smaller scale. Furthermore, I do not perform Pest Inspections and 'follow-up' with a Home Inspection on the same property - which to me has the appearance of conflicted interests. But if that's what your business involves then it's just that - Your business.

    I see nothing wrong with getting referrals from RE Agents, for repair work. These primarily involve the selling agent contacting me on behalf of the seller to repair/improve issues which either need fixing before or during the listing, or which have become an issue (in need of repair) following an inspection (of which I had nothing to do with). In that regard, I also consult with the seller regarding issues which may be raised in the report. If necessary referring them back to the original HI for clarification (which leads to another topic for a later date).

    If then, Mr. and Mrs. Happy Homeowner - being pleased with my workmanship, knowledge and ethical performance wish to contact me with regard to a future inspection at an unrelated property - then the aforementioned attributes are nothing short of good business marketing skills. I do not see how any HI can conduct his/her business without building a rapport - at least to some degree - with RE Agents. And, if you don't, why not?

    I'm sorry Ted, I just do not follow your logic of my 'being put in harm's way' when no laws are broken. It's also hard to fathom how one can be, "...way too involved with any kind of work other than inspections with your home inspection clients..." My business practices are obviously far more encompassing than your own but if that's how you like to work and you survive, congrats...

    Going back to my original concern - would anyone contact the original client or is that opening up the proverbial can...?

    ip


  12. #12
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    Default Re: Dilemma...

    Ian, If she is your friend, you should a least warn her that any future liability for errors or omissions in that report will fall on her, not you, and that she should discuss this with her broker and insurance company. It will be her turning over faulty information, not you.


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    Default Re: Dilemma...

    Ian,

    Sorry to say, but I agree with Ted on this one.
    I perceive the issue to be that you are reluctant to approach the realtor for fear of loosing business.

    That looks like you are in bed with them and that you will "bend" to keep in good terms with the realtor. I see it as a conflict of interest.

    If I were on the jury, I would vote guilty. You need to clean up your act, act more professionally. If not for you - do it for our profession.

    Ken Amelin
    Cape Cod's Best Inspection Services
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    Default Re: Dilemma...

    In the past we had some concerns about reuse of our WDIIRs. This was solved by adding the satement "THIS REPORT VOID AFTER 30 DAYS". This has stopped realtors from using the report more than once.


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    Default Re: Dilemma...

    I don't know how it works in CA but here the report belongs to the client. We aren't allowed to share info about the inspection with anyone but the client without the clients permission. With that in mind, why are you emailing the report to the realtor at all? I don't email reports to realtors, only to the client. If the agents asks for a copy I tell them to get it from their client.
    Changing that should help you in the future.
    As far as this situation, you seem to be stuck in a mess you made yourself. Your close ties to the agent seem to be keeping you from doing what you seem to know you should do; send the agent a cease and desist letter.
    If the agent is so willing to do this and blow off your initial requests to stop, then how desperate is she overall? I would suggest evaluating what professional path she is on. Is the agents financial situation (lack of closings) a bit dire or does the agent just play loose and wild anyway. Is there potential that the agent may put you behind the eight ball even more in the near future? Is there added exposure? Should you consider distancing yourself now, even though you don't want to. Friends who make you ask such questions aren't necessarily the best friends to have.

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  16. #16
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    Default Re: Dilemma...

    IMO NEVER NEVERE NEVER NEVER Get my point never give an agent your report. It is between you and your customer


  17. #17
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    Default Re: Dilemma...

    Ian,
    As you have stated in previous posts and threads you work within the law and have resolved any ethical issues in that regard.

    Would you explain if CA real estate law law has specific requirements (obligation) of agent disclosure to seller or buyer of:
    1) Defects in property.
    2) Source of defect discovery.
    3) Method of defect disclosure.
    4) Responsibility of agency between the agents involved in a sale to the seller.
    5) Responsibility of agency between the agents involved in a sale to the buyer.

    Things wary from state to state as the law and its interpenetration. By example in MD a HI can not do squat as it pertains to work for the client for the period of 1 yr. There apparently are also differences in the fiduciary responsibilities actions of the agents involved.


  18. #18
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    Default Re: Dilemma...

    Quote Originally Posted by Ian Page View Post
    I truly appreciate everyone's thoughts and comments. The RE Agent called me several times, advising me of her passing on the report and to expect a call or two from the 'new' buyers or their agents.

    Ted, you are mistaken with regard to your interpretation as to my combining one aspect of my business with another. I have a few more scruples than that, a healthy respect for Ca. Business Licensing laws and very good legal counsel. Please re-read my previous explanations. Yes, I do do work on clients properties. It is NOT repair work (which is precluded under CA Business Regs) but may be 'replacements, installation or improvements' which ARE NOT precluded. Only under CREIA, ASHI and InterNashi's s.o.p. are they denied - but I am not a member of either for that very reason.

    The Handyman work I perform is no different than a GC, building and remodelling homes and providing Inspection services - just that my (Handy) work is on an infinitesimally smaller scale. Furthermore, I do not perform Pest Inspections and 'follow-up' with a Home Inspection on the same property - which to me has the appearance of conflicted interests. But if that's what your business involves then it's just that - Your business.

    I see nothing wrong with getting referrals from RE Agents, for repair work. These primarily involve the selling agent contacting me on behalf of the seller to repair/improve issues which either need fixing before or during the listing, or which have become an issue (in need of repair) following an inspection (of which I had nothing to do with). In that regard, I also consult with the seller regarding issues which may be raised in the report. If necessary referring them back to the original HI for clarification (which leads to another topic for a later date).

    If then, Mr. and Mrs. Happy Homeowner - being pleased with my workmanship, knowledge and ethical performance wish to contact me with regard to a future inspection at an unrelated property - then the aforementioned attributes are nothing short of good business marketing skills. I do not see how any HI can conduct his/her business without building a rapport - at least to some degree - with RE Agents. And, if you don't, why not?

    I'm sorry Ted, I just do not follow your logic of my 'being put in harm's way' when no laws are broken. It's also hard to fathom how one can be, "...way too involved with any kind of work other than inspections with your home inspection clients..." My business practices are obviously far more encompassing than your own but if that's how you like to work and you survive, congrats...

    Going back to my original concern - would anyone contact the original client or is that opening up the proverbial can...?

    ip
    I use an outside company for WDIs. It states that clearly on my front page and maybe other pages of my website. I do not make 2 cents on that inspection such as a referral fee or anything else. It is strictly for the clients convenience that I set it up for them.

    I also happen to lose a fair amount of inspections (a lot) due to that practice as most schmucks either give the WDI away (and everything remotely related to home inspection) for free or almost for free. This drives my price for the home inspection down so they can still get a termite inspection as well. That charge is 70.00 for a termite. As I say I lose the inspection and when I get the inspection I am making 50 to 70 dollars less than many inspectors that give it away. If I gave the termite inspection away (if I did it myself) I would still lose half the calls coming in for inspections as the fools are still way below me and I work (unfortunately) way to cheap as it is.

    I do not pimp myself out to Realtors (not saying you do but just that I do not and never have). I am nice and kind and friendly but that is where the line is drawn. I do my inspection and my report and my wording, no sugar coating, no picking the soft blow words but certainly not scaring anyone. I start the inspection on my schedule and do not wait for it to be a good time for the Realtor. They cannot make it there then that's life. I go on with out them and I prefer the Realtor, buyers agent or sellers agent, not be there at all but if they are, only in the end. I do not want the resemblence of influence in anyway and do not allow any momenet of posible influence trying to be exerted by cute little comments. As a matter of fact I do not want a Realtor to open their mouths while I am going thru an inspection or simply doing an explanation of my findings in the end.

    I chose to have an outside company do the WDI because I did not believe it was fair to the client to try to get both in in the allotted time. They get a far better deal with me as I am there to do nothing but a home inspection. I keep my mind (what little there is left) only on home inspection. It is a win win for the client and I enjoy not running around like an idiot drawing out a graph and filling out the WDIs and then getting on with the home inspection.

    I mentioned in another post on another thread that this business of home inspection is becoming a pimp service with all the 90 day warranties for a home inspection. 90 day warranties for a termite inspection. Giving the termite inspection away even with the cost involved with insurance and cont ED classes and liability. Free IR scans. 200% guarantees on the home inspection as in you get you money back, you get a new inspector paid for the same fee (of course the home is closed on and the folks moved in before they become unhappy). Like that does any damn good and by doing so on the 200 percent guarantee they sign all rights away to liability for anything they miss, same thing with the warranty. Sign for the warranty and give away the rights of liability because you are covered for 90 day.

    What a damn racket. It is getting to be about impossible to compete price wise due to all these ignorant giveaways. I just do not understand why folks cannot just sell themselves on being a home inspector and once done talk the rest up and get some more money. We have lost many part time inspectors in this state due to the mandatory insurance and work load being cut in half. Even with that now there is the absolute give away boys laughing there way to the bank. Ho ho ho, give everything away and scoop all the work. What a wonderful business man I am. I do much more work and make far less because I give everything away. What a business.


  19. #19
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    Default Re: Dilemma...

    Quote Originally Posted by Ian Page View Post
    The RE Agent called me several times, advising me of her passing on the report and to expect a call or two from the 'new' buyers or their agents.

    ip
    When the agent called the first time I would have told her that I couldn't discuss the report without the original client's permission. Then I would have told her that if she wanted me to discuss the report with others she should contact the original clients and have them contact me.

    If the other clients called me with questions regarding a report I made for someone else I'd tell them that I couldn't discuss the report with them, since it was not their report.

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    Default Re: Dilemma...

    Most states have laws that agents and owners/sellers need to disclose any know defects. Some sellers may be exempt from the regualtion such as an estate or a bank REO.

    Once an inspection is done and the agent becomes knowledgeable they must disclose such defects. The agent is using the report to inform their clients of their knowledge and as a marketing tool. I don't see anything wrong with it. The inspector did his job and got paid.

    As an appraiser I found agents did this with my reports. Not much I could do about it and not anything worth losing any goodwill over. Banks did the same thing. If the bank turned down the loan the borrower went to another bank and used the report. I didnt dicuss the appraisal with the new bank without a release and some form of compensation.

    If the report clearly spells out whom the client is and that you have no obligation to anyone but the named client then you have no liability to any other users of the report.

    Also, I don't see how this is any different than a presale inspection for a seller.

    What I wouldn't do is consult without a fee and contract is discuss any part of the report. I would advise the agent you are not free to discuss the contents of the report with anyone but the original client and that the agent should clearly inform buyers that the report carries no warranties and no obligations on the part of the inspector.

    At one time appraisers were required to get a prior clients approval in order to reappraise a property until such time as market conditions had changed. That regulation has been changed and you do not need a prior clients approval. I think it should be the same with an inspection. Just because you did a report on the property should not stop you from doing one for a new client.


  21. #21
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    Default Re: Dilemma...

    I agree with Ken in post #19.
    When the agent called and told you to expect a call from the new buyers I would have stop the issue right then. As Ken said.

    If a man empties his purse into his head no one can take it away from him. An investment in knowledge always pays the best interest
    Benjamin Franklin

  22. #22
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    Default Re: Dilemma...

    Ian In Calif. its the law that report be given to the seller/owner or owners agent and then the seller can do with it as he wants. In these kind of condition I would not do a reinspection of any kind.

    Best thing to do is wash your hands of this and move on to other paying inspection.

    Best

    Ron


  23. #23
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    Default Re: Dilemma...

    Okay...for clarification. The agent in this instance is a friend - but a closer friend of my wife's. Kinda hard to separate the two but they go on spending trips (used to be shopping trips but I found they were spending more than shopping), lunches and such. My relationship is primarily a business one but she is still a 'friend' none-the-less and we have known each other for over 12 years. I provided her with the hard-copy report it in a sealed envelope addressed to the client, purely for convenience. (Actually I didn't even meet with her, just left it on her office desk for further delivery). She was meeting with the original client and I had other work to attend to. However, further communication was done via email and phone calls between myself and the client. She paid for the inspection by check in the mail within two days. Neither the agent nor client was present during the inspection.

    When the agent called the first time advising me that the original clients had walked, had another 'new' client for the property and had shared the report with them, I expressed my concerns. She said, at that time, my report was part of the 'house file' kept at her office - she is also the 'Listing Agent' acting on behalf of the lender/seller. I also asked if she had discussed 'farming -out' the report with the original client. She said she had not but as the report was documenting deficiencies it acted as a disclosure and didn't see my concern(s) as an issue. Another similar call followed a few days later. To date, no new prospective purchasers or their agents have called me but I learned an offer had been presented.

    My primary concern is not with regard to an 'offend or please' the agent issue. I expressed my concerns to her regarding the ownership of the report and any rights the original client may have by paying for it. But the fact that one client can pay for the report and then have it shared, without compensation (them or me) to all and sundrie, is disarming. I think we shall have another sit-down talk. I have no objection to her giving a verbal overview of any deficiencies but providing copies of the report is another matter, irrespective of its validity.

    My report does have a disclosure stating that it is a contract between myself and Client XXX only and that any and all observations, evaluations and identifications are valid for the time and day of the inspection only.

    Garry - I am not aware of any specific responsibility to identify the knowledge source of defects. However, there is a duty to advise the buyers if they are/become aware of defects and consequences for failing to do so. Similar liabilities are imposed upon the sellers themselves. Reading the defect (in a Inspection report) and/or discussing the defect with me would qualify as to them having their own knowledge which is, in turn, supported by the report. Re. (4) and (5) - There are Agent/Buyer -Agent/Seller responsibilities and duties to inform. I would also carefully look at the wording in the applicable MD law as it pertains to performing work. It may be open to interpretation.

    And Ted...enjoyed your rant!

    Again, many thanks for all the insightful, constructive comments and advice. All taken into consideration.

    ip


  24. #24
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    Default Re: Dilemma...

    Quote Originally Posted by Timothy M. Barr View Post
    IMO NEVER NEVERE NEVER NEVER Get my point never give an agent your report. It is between you and your customer
    I totally agree. The RE agent does not need to have a copy of the report. Sellers/buyers get the report and have the prerogative of sharing it with their RE agent if they so choose.


  25. #25
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    Default Re: Dilemma...

    Ian,
    I looked back over this post and I am not on a high horse. Just speaking from the heart and stating it as I see it. Not looking to be judgmental either. You may not like it, but its straight talk (maybe a little harsh). Try not to take offense.

    You wrote:
    ..."My report does have a disclosure stating that it is a contract between myself and Client XXX only and that any and all observations, evaluations and identifications are valid for the time and day of the inspection only."....

    You may have learned something with this experience. That your friend/agent is first an foremost an agent. The hijacking of your report without any regard to what ever you had in the HI contract. The agent is all about the moment. I would bet that the attitude is that what is mine is mine and what is yours is mine.

    Its cute that the agent is the listing agent. Using the concept of:

    ..." She said, at that time, my report was part of the 'house file' kept at her office - she is also the 'Listing Agent' acting on behalf of the lender/seller. I also asked if she had discussed 'farming -out' the report with the original client. She said she had not but as the report was documenting deficiencies it acted as a disclosure and didn't see my concern(s) as an issue"....

    The question I would pose is how is it part of the " house file " unless it was released to the agent by the client. To bad you don't have a law degree and could clain attorney client privilege. I know a little far fetched.

    Calf. has some law (I think recent) about "historical documentation" and seller disclosure. The HI being part of that disclosure when the HI is ordered by the seller or after the buyer ordered HI purchases the property and then in the future becomes a seller. Then as I understand it, the seller would have to offer the HI as part of the property's "historical documentation".

    But under the concept of a product (HI) it belong to the client (buyer) and not the seller or their agents. Thus, unless the buyer offers (free or sell) the report to the seller the seller or their agent have no right to be informed of its content. Unless there is a loop hole in Calf. law forcing the report to be given to the seller. The agent by having the opportunity to read the HI or being told of its contents by the buyer, would have to inform the seller of the reported deficiencies/defects in the property that had been mentioned. The documentation of those defects would be at issue. The seller being told (verbally or in writing) of defects by the agent would be put on notice of their existence. The seller would have to either accept the notice or obtain documentation that the defects were not defects by a professional in that area or that the defects had been corrected (with documentation). The agent could not conceal information about the property. In the old days they could, it was don't ask don't tell. If you did not tell me - then I do not know. If asked I know nothing.

    You said that you were to busy to deliver the report to the client and probably thought the agent would handle the envelope professionally, delivering it to the client as it was the clients property. The agent at that time would ask to see the report and ask for a copy, using any lame excuse to get her hands on it to pimp out tho the agents benefit.

    There is a sucker born every day (no offense intended). I bet that the only leverage is that of the buyer/client disavowing the offering of the report for the agents use. The agent stole the report but no one will press charges. Therefore no case against agent. You could ask to see the written release of the report by the client and ask why the agent does not have one. The fall back will be that of verbal permission, true or not.

    So many people will use some form of rationalization to justify their actions no mater how immoral, unethical or illegal the action.

    You say that you are going to have another sit-down with the agent. Unless you can pose to the agent that there is some legal liability for her and her brokerage, she will blow you off. Unless you are willing to take a stand as to ethics, then you will be her pawn now and in the future. You are setting a president for that agent on how they will act in the future with you and others.

    An inquiry to the State Real Estate Com., State Real Estate Lic board, State Attorney General, a Real Estate Attorney prior to talking to the agent could give you a leverage position that the agent might respect.

    The agent and her broker most probably will circle their wagons unless they see some consequence to their actions. Then the broker will through the agent under the bus to protect the agency from litigation or other actions.

    Like, you having consulted an attorney to split the hairs in Calf. law as it pertains to performing repair/remolding services to your clients. Chickens do come to rust on occasion.

    I do not think that you will really do anything of any real meaning value. You will not rock the boat on the behalf of your client. You most likely just let it ride. Since the client doesn't know that they have been taken advantage of by the agent and were damaged. You will look to the future money that the agent will generate for you. The agent is the pimp and you have sold your ethics/morals to them. The rationalization is that you need the work and its a small price to pay for future earnings. So your wife can go shopping with the agent.


  26. #26
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    Default Re: Dilemma...

    I'd consider putting some very pointed verbiage in bright red letters on every page of the report that will make any agent (and buyers) look like a thief for sharing the report with anybody other than the person who paid for the inspection.

    NOTE - THIS INSPECTION-REPORT AND IT'S FINDINGS ARE THE SOLE AND PRIMARY PROPERTY OF THE CLIENT NAME LISTED ON THE REPORT. SHARING AND/OR USE OF THIS REPORT IN IT'S ENTIRETY OR ANY SECTION OF IT WITH OR BY ANYBODY OTHER THAN CLIENT NAME LISTED IS CONSIDERED THEFT OF SERVICES. THE INDIVIDUAL(S) WHO SHARE AND/OR USE THIS REPORT WITH ANYBODY OTHER THAN THE CLIENT NAME LISTED ASSUME ALL LEGAL AND FINANCIAL LIABILITIES ASSOCIATED WITH THIS REPORT, INCLUDING ERRORS AND OMISSIONS.

    "It takes a big man to cry. It takes an even bigger man to laugh at that man". - Jack Handey

  27. #27
    Join Date
    May 2010
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    No. San Diego Co., CA
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    Default Re: Dilemma...

    Nick - That's a great idea, though I will have to get a legal opinion as to whether inappropriate use of the report is considered theft (of services) under CA law. Another issue, therefore is...who does the report itself belong to. Sure it's generated by an Inspector but it - and its content - is purchased by the client for an agreed upon fee. So, who is the victim in that case? The act of theft requires a victim, the victim must suffer a loss or be permanently deprived of the goods or their value) . Never-the-less I do think a strongly worded admonition is a good idea.

    Garry, I take no offence and I basically agree with most of your post. I do, however take exception to the last two paragraphs. First, I am NOT, splitting hairs. The law reads what it reads and there are no two ways about that. I fully comply with the law, as written, in CA. Other people may disagree but that's because of being indoctrinated into believing what they have been told or are accustomed to without doing a little reserch of their own. I ask - what does the word 'Repair' mean to you? And then ask you to do any research you care to see if it conforms to your personal interpretation. Legal definitions (of words/phrases) often vary significantly from their everyday use or language.

    Secondly, I have not, IMO, sold out my ethical values - which are, in any event subjective in nature and open to interpretation. What is ethical to you may not even be a relevent issue for someone else. So, because I have pondered this dilemma and asked insight from this board, I have taken no action as yet, seeking enlightenment before I do so. Unless you are referring to other work I have performed, this particular issue aside.

    In CA, the Agent acting on behalf of the purchaser, is obligated to review any deficiencies exposed in the Inspection - it's an issue of transparency. Yes, the report is initiated on behalf of the purchaser/client, but the findings must be shared between the parties on hand (Agents/sellers). The buyer's Agent need to know the basis of further negotiation if issues are discovered. I doubt any Agent in the US would be able to conduct meaningfrul representation of their client without having knowledge of the content of the (inspection) report. RE transactions simply do not occur like that. Therefore it is perfectly usual, legal and normal for agents to review the report with their client and vice-versa. There should be no secrets in the transaction and the offer to purchase, or renegotiate repairs/discount for such, must be supported by documentation.

    ip


  28. #28
    Ron Bibler's Avatar
    Ron Bibler Guest

    Default Re: Dilemma...

    Ian Garry in post #25 IS ON THE MONEY...

    Just walk away... At one time we HI could keep our reports out of the open maqrket. But that is not the case today. Your report is now part of that homes "historical documentation" .

    Best

    Ron


  29. #29
    Join Date
    May 2010
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    No. San Diego Co., CA
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    562

    Default Re: Dilemma...

    I hear you Ron, loud and clear - but it does make for interesting and informative dialogue.

    ip


  30. #30
    Join Date
    Mar 2007
    Location
    Eastern NC
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    Default Re: Dilemma...

    Most real estate agents I know would rather not see the report as to the obvious that they have to disclose everything now. In the future, Ian, I would forward it directly to the client.

    As for the relationship with the "friend" I would be careful in the future. In this day you have to be careful because there is not a whole of work out there. I would not call the original clients and I would not say anything to the friend. I would say very discreetly start changing your methods and make it your own SOP. Everyone on here has given some good advice.

    One thing I would like to add though is I do not have anything about my report is valid for X days. It is only valid for the day of the inspection. I call it the threshold warranty, once I walk out it is yours. I know that is a little simplistic. Of course if I missed something I would honor it. Most of the appraisals that I have seen pretty much say the same thing.


  31. #31
    Join Date
    May 2010
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    No. San Diego Co., CA
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    562

    Default Re: Dilemma...

    Mitchell

    We have a 'discovery' law in CA, which means the inspection report is shared by all parties involved in the negotiation. So delivering the report to the client - avoiding the realtors - is moot.

    I did had another conversation with the agent - and her broker, regarding the practice of report sharing. They understood my position but also said no harm was done nor was I legally exposed. I didn't fully agree with that part. Anyway the Agent said she had not 'handed' a copy of the report to the new prospective purchasers, and had only shown it to them by way of discussing the deficiencies I had found, which were now within her own knowledge and was therefor obligated to do so.

    My reports now contain an advisory notice - in bold type, "This report is for the sole use and benefit of the undersigned client, having paid for the service provided. Findings contained herein are applicable only to the time the property or component part within the property was inspected. Reliance on this report or part thereof for any purpose or by any party, other than the undersigned, is at their own risk. No liability or responsibility is accepted or assumed by the Inspector to any other person or entity not party to an agreement or contract to compile this report."

    So far the issue has not re-surfaced. I appreciate all observations and advice.


  32. #32
    Join Date
    Dec 2008
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    Maryland
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    Default Re: Dilemma...

    This is directed at those in California. Since the CA discovery/disclosure requirements may be unique to CA.


    CA requires the Seller to disclosure of all documents relating to the property and disclosure of all known defects, as it is in most states.

    My question:

    Does CA law require that the Buyer provide the seller a copy of the inspection report to the buyers agent and subsequently the seller?
    Point being, if the report is first given to the Buyer (and only the Buyer), is the Buyer obligated to share the report.
    Assuming that a disclosure requirement is not part of the original contract (offer to purchase) for the property.

    I understand that if either agent or the seller is provided a copy then it has to be disclosed to all parties and all future parties. The report becomes a historical document that has to be passed along with the property.

    But if only the Buyer has the report, must they publish the report prior to closing on the property?

    Is there a way to make the report privileged communication to the buyer? Thus making the report the sole property of the Buyer and totally under the Buyers control.


  33. #33
    Joao Vieira's Avatar
    Joao Vieira Guest

    Default Re: Dilemma...

    Regardless of the local law I would definitely include a disclaimer in all reports stating that the inspection is only good for a certain period of time. There are too many people out there that will grab on whatever they can.


  34. #34
    Chuck Shamrock's Avatar
    Chuck Shamrock Guest

    Default Re: Dilemma...

    Quote Originally Posted by Timothy M. Barr View Post
    IMO NEVER NEVERE NEVER NEVER Get my point never give an agent your report. It is between you and your customer
    The client gets the report and if they want to give it to the agent that's fine. Some clients Don't want the agent getting the report, but only in cases where they are representing both sides of the deal.


  35. #35
    Join Date
    Feb 2010
    Location
    Omaha
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    Default Re: Dilemma...

    Quote Originally Posted by Joao Vieira View Post
    Regardless of the local law I would definitely include a disclaimer in all reports stating that the inspection is only good for a certain period of time. There are too many people out there that will grab on whatever they can.
    You really have no control on who may come into possession of the inspection report and how it may be used. What you should be concerned about it your liability. Define the client and that you only have an obilagtion to the named client.

    Home inspections do not have a shelf life. Home inspection are the observation that took place at the time of inspection. You are saying based on this point in time the condition of the home was as reported.

    The conditions could change the minute you leave the door. The homeowner could decide they are not leaving that expensive dishwasher and improperly install a new dw, a storm could pass through, etc. If you place a shelf life on the report you are effectively saying things have remained unchanged since the time of inspection.


  36. #36
    Join Date
    May 2009
    Location
    Washington State
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    358

    Default Re: Dilemma...

    Quote Originally Posted by Ian Page View Post
    I performed a HI a few weeks ago on a newer $500+k tract home but the purchase ultimately fell through. This was a short sale on it's way to foreclosure. I discovered and reported several issues (A/C, broken roof tiles, broken window etc.)

    The realtor acting for the buyer is a friend of many years. As a Handyman I have done several repairs for her at some of her rental properties and she has referred me to many of her past clients, for whom I have also done repairs and installations. She has also referred other inspection business to me.

    Upon completion of the inspection I asked the realtor to forward my report to the buyer, which she did. However, the deal fell through because, in part, of the issues I reported, which would have presented a financial hardship to the newly-wed buyers to fix. The realtor retained a copy of the report for the 'house file'.

    The realtor has now had several 'new' clients and because of the urgency in attempting to close the sale before the short-sale deadline, has provided copies of my report (I believe, without the original client's knowledge) to these new prospective buyers. She may also be using it as a 'selling tool'. At least one, maybe two, of these new buyers are now making offers on the home, using/relying (on) my original report for negotiating purposes. None of these prospective buyers have contacted me, engaged my services for a new inspection or to review the original report.

    I have had no cause to return to the property. Furthermore any recent buyers are not privvy to the additional information, communications and original photographs, which I shared with the original clients. So the report they have in hand is, to some extent, incomplete.

    I know I have no fiduciary responsibility to anyone using my report (to engage in their own contract). I did explain to the realtor that the information in the report was only 'good' for the time of the inspection and that I could not be held accountable for the condition of the property since that time. I also explained that the report was a contract between myself and the original client only. I also said I would gladly do a re-inspection on behalf of any new clients but they (obviously) are looking to save $$$ by not having a new inspection. I would appreciate anyone's advice or thoughts on the matter. Cutting ties with the realtor is not an option, though I am a little PO'd to say the least.

    ip
    Some Friend.....Sounds like just another low-life realtor - if she's your friend, why is she screwing you out of making a living?


  37. #37
    Russel Ray's Avatar
    Russel Ray Guest

    Default Re: Dilemma...

    You're in California, and if the buyers used the standard California Association of Realtors purchase contract (which everyone does), it states that the buyer shall provide to the seller, at no charge, copies of all inspection reports. It's not your duty to provide a copy of your report, but the buyer is required to.

    Some sellers want the report, some don't.

    Once the sellers have the report, they can do with it as they see fit, including using it as part of their disclosure, providing it to their real estate agent, providing it to prospective buyers, and even making additional copies and leaving them on the kitchen counter so that anyone can take one.

    Nothing you can do about it, courtesy of the Leko Decision of January 31, 2001.


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