Problems with Lawsuits against Home Inspectors

Problems with Lawsuits against Home Inspectors

  Question: We closed on the purchase of a home in Chandler three months ago. Since closing we have had significant electrical problems. A licensed electrical contractor said that, among other things, two electrical panels need to be replaced. The cost of these repairs will be at least $3600. During the 10-day inspection period, we had a home inspection at a cost of $475 which showed no electrical problems. Is our home inspector liable for the $3600 cost of the electrical repairs?

  Answer: If your home inspector was negligent in failing to discover the electrical problems, you probably have a $3600 claim against your home inspector. There are at least two problems, however, with your $3600 claim. The first problem is that most contracts with home inspectors limit the liability of a home inspector to the cost of the inspection. In other words, the home inspector’s liability would be limited to the $475 paid by you to the home inspector.

Arizona law has upheld these limitations of liability for professionals. For example, the Arizona Court of Appeals has ruled that an architect can limit his liability for negligence to the amount of his $15,000 fee. These limitations of liability, however, may no longer be enforceable by home inspectors and their attorneys. Recent Arizona statutes require home inspectors to be licensed and to have liability insurance. These Arizona statutes are designed to protect the public from negligent home inspections. If a home inspector could limit liability to the cost charged for the inspection, the purpose of these Arizona statutes would be nullified. Therefore, if your home inspector won’t pay you more than $475 for the $3600 cost of the electrical repairs, you should contact an attorney.

The second problem in recovering the $3600 from your home inspector is that generally another home inspector would have to be hired by you to testify that your home inspector was negligent in not discovering the electrical problems (similar to a malpractice claim against a surgeon, where another surgeon generally has to testify that there was malpractice by the surgeon in the surgery). The cost and availability of home inspectors who would testify against another home inspector can be prohibitive in enforcing a claim for negligence against a home inspector.

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