Monday, March 4, 2013

Inspector's risk - 1

Inspectors had not been the real target in the past when most leakers are within the "10 year frame". But what happens when leakers are expired, i.e. exceeded the "10 year statutory limitation"? In that situation Councils no longer be the last standing party with full pocket. Who can pay you to fix your leaky house if not Council? The answer looks like - the Pre-purchase Inspector.

One reader wondering why Council does not pay. Here is the answer:

The house was eligible and therefore if FAP is selected, 50% of the repair cost would covered by the government and the council. As there is no further WHRS related case, I assume that the owner went for FAP.

Plus the 50% cost recovery from the inspector, the owner's repair cost is fully recovered.

I reckon the inspector in this case is pretty lucky. If this case is outside the 10-year-frame, then the owner would be fighting for 100% cost recovery from the inspector.

Here is the summary of the Case:

Case CIV-2011-485-1308 Hepburn vs. Cunningham

A house built at 2000 with texture coated fibre cement is bought at 2007 by the plaintiff based on a positive "quick check" builder's report issued by the respondent. Although built with wide eaves, apparent cladding defects, such as lack of cladding/ground clearance, omitted by the inspector which is introduced by the agent. No Terms & Conditions form was signed by the plaintiff. 

3 years after the purchase, the house was marketed again and was inspected by RealSure on behalf of a purchaser with a report showing various weathertightness issues. 

The plaintiff subsequently applied through WHRS, which expert recommended partial repair costing 100k. 
The plaintiff gone further through High Court and sought more than 500k for damages with final decision in favor of plaintiff for 360k award with half to be paid by the inspector. 

Issues to be discussed:
Quick check vs. Rolls Royce service
Roles of Terms and Conditions
Significant issues, if not rocket science, to be reported
Duty to give clear advise rather than a report only

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