Expert: Russel Ray - 12/3/2008

Question
QUESTION: In August 2006 we purchased our first home. The inspector (recommended by our real estate agent) found nothing "majorly wrong". The sellers, a couple where one person was retired, moved to Florida before the ink was even dry on the paperwork. Soon afterwards, the problems started: what wasn´t superglued or covered up, fell down (an entire cabinet fell on me as I tried to open it) the washing maschine caught clothes and ripped them up, the pump in the basement stopped working and we had flooding in the basement. The people we called in to check this, said, that tampons and dryer lint had been flushed down that toilet. Over every broken tile in the kitchen and bathrooms carpets were laid or pictures hung over cracks, holes etc. in every wall. Our contract says we bought the kitchen with a disposal (there is none) and that the sellers were not aware of termite problems. I found a bill where they had purchased several thousand gallons of termite stuff (what do you cal it). Don´t tell me that there was NO termite problem then why would one need to buy this huge amount for treamtment!? Promplty we had a termite problem the following summer... Plus, we found a big open hole in the basement- where carpets had covered it up. I thought since the sellers moved away to Florida there is nothing I can do, and I was told by a friend who knows a real estate attorney, that the inspector is only responsible for structural problems, and not, what I describe, like almost being killed by a cabinet that is falling down on me, a doorknob that I touch and the handle falls off, towel holders that, when touched, just fall off, because they too, were just glued in place!! I am so upset about the whole situation because we (due to my handicap) were and are not able to fix the house up, that´s why we paid full price to get a house where nothing needed to be done, and now this! About 2 weeks ago, I read in the paper that our sellers have returned from Florida to our little town and that they now live about 2 streets from us. Apparently, it was too hot in Florida for them... Is there anything I can still do? Small claims court, see a lawyer? Anything at all? Thanks alot and God Bless you for your wonderful work and help to all that have questions!

ANSWER: Hey, Gertie.

Before I answer your inquiry, please let me know what state you are in, what date the home inspection was done, when you closed escrow, and when you actually moved into the home. I'll be able to give you much better guidance then.

Russel

---------- FOLLOW-UP ----------

QUESTION: Hey back Russel,
Thanks for the quick reply! We are in New Hamphire. The inspection was done around the middle of June 2006
We closed escrow on June 30 and moved in over the 4th of July weekend.
It might not matter but I am walking impaired since our baby was born (January 2006) and due to a permanently damaged femoral vein I am having huge trouble bending just in case it would have ever occurred to me to lift up carpets and look under them… all of these things, I thought the inspector would be responsible for. Our real estate agent, the inspector and the mortgage company were all “in the same boat” even in the same building as I now know, so it was probably not in their best interest for us not to buy the house. The sellers pretty much represented themselves, held the open houses etc their real estate agent was (as we were told later on) just paid a partial fee (negotiated beforehand by the seller) for showing up for the closing.
Thanks, thanks, thanks!!

Gertie


Answer
Hey, Gertie.

Here's the New Hampshire legal statutes for home inspectors:

http://www.nh.gov/jtboard/homeinspectorlaw.htm

Apparently, licensing for home inspectors is supposed to start sometime in 2009, so there are no requirements for home inspectors right now. Just like us here in California, except we have no licensing coming anytime in the foreseeable future.

The lack of licensing probably works in your favor, but you'll need to consult with a good real estate attorney to determine that. Generally, most attorneys will provide you with a 30-minute free consultation, so take advantage of that.

What might work against you is that this is December 2008 and you bought the home in summer of 2006 (at first you said August 2006, but then you said you closed escrow June 30, 2006). When did you start having problems? Regardless of when the problems started, that's the part that may work against you in an unlicensed state.

If you started having problems in August 2006, and you say "soon afterwards, the problems started," then why did you wait 2˝ years?

Without any licensing, there might not be any statute of limitations, which again can work against you or for you. There might be a court case in New Hampshire that has created case law that provides a statute of limitation, but only an attorney would know that.

If there is no relevant statute of limitations, then that works for you.

Did you sign any type of agreement with the home inspector? If you didn't, that works in your favor, too. If you did, you need to read it completely. You also need to read the home inspection report to determine exclusions, conditions at the time of the inspection, what the inspector did and didn't do, etc.

You say the home inspector found nothing "majorly wrong." Whose words are those. Is that from the home inspection report? That would be unusual language for a report.

The fact that the sellers are back in New Hampshire helps you because it's difficult to sue someone in another state. It can be done, but it's expensive and time consuming.

Sometimes problems occur between the time of the inspection and the move-in date because the sellers simply don't take care of the place any more, or mistreat it, wrongly assuming that it now belongs to someone else. If you have good documentation about all the problems that will work in your favor.

Home inspectors generally don't move furniture, carpets, rugs, pictures, etc., because they don't have appropriate general liability insurance. My own personal belief is that a home inspection should never occur when people are still living in the home, but we have to work with what we have.

Did you not have a final walk-through? That's generally when things under the carpets, holes in the walls behind pictures, and similar things will be visible. Some wall and ceiling cracks are simply either common drywall seam cracks or lathe-and-plaster cracks, so those in and of themselves might not be problematic. Holes from pictures in the wall are the same. Holes from someone punching the wall or kicking the wall are a different story.

I haven't met a home inspector who didn't test and inspect the disposal. What was in the inspection report concerning that? It's not unusual for sellers to remove appliances after the home inspection, sometimes replacing them with lower quality appliances and other times not replacing them at all, like the disposal.

If your contract and/or the MLS listing say there is a disposal, but there's not, you pretty much have an actionable case there against the seller.

Purchasing several thousand gallons of termite pesticides doesn't necessarily mean that there were termites. The sellers might be like me in being proactive in preventing termites. I admit that I don't have several thousand gallons, though. He might have had things in storage for a relative or friend who is a pest control inspector. I think further research is warranted on this one.

Termites swarm once a year, so having a termite problem the following summer would not be unusual. Here in San Diego we have two types of termites, and they swarm in May and August. So one could buy a home in July and have termite problems in August.

The holes in the basement that were covered up by carpets should have been seen at the final walk through. It sounds to me like you're using the term "carpets" to mean floor rugs rather than permanently installed carpet floor covering.

I have to question your friend's statement "that the inspector is only responsible for structural problems." That would be extremely unusual in any state. Generally, home inspectors, even in unlicensed states, have a "duty of care" to the public -- that's you -- and must inspect to "generally accepted local standards of practice." Was your home inspector a member of InterNACHI, ASHI, NAHI, SPREI, or any other home inspector trade association, or the BBB, or the Chamber of Commerce?

Glue is not the best thing to attach doorknobs, towel holders, etc., but it sure can get people through a home inspection and another couple of months. I think this deserves further investigation, too, because if you have a lot of this type of activity going on, you might also have an actionable case here.

Did you sign any disclosure documents about your "real estate agent, the inspector and the mortgage company" all being “in the same boat”? Just because they are in the same building doesn't mean that they were in collusion, but collusion does occur.

I would say that you have two things to do at this point:

First, contact your Realtor with good documentation about your problems. S/he should be willing to help you since you are the Client.

Second, contact a good real estate attorney and see what legal recourse you have.

Third, contact your home inspection with the same good documentation about your problems.

If you'd like me to read over the home inspection contract and/or the home inspection report, I'd be happy to provide whatever additional guidance I can. Let me know.

If you need to follow this up, contact me directly at russel@russel-ray.com. Followups here at All Experts can get pretty messy if they go on too long because everything is in one message.

Russel