January, 2004
Feature
Inspection News and Views from the American Society of Home Inspectors



Resolving Complaints, A Risk Management Series For Home Inspectors, Part 2 of 4

ALAN CARSON

Alan Carson originally developed this information for Carson Dunlop's training programs. Visit www.carsondunlop.com.

Are you looking for long-term success in the home inspection business? Last month Alan Carson made a case for learning to successfully resolve complaints in order to achieve this goal, and members preparing to deliver The ASHI Experience will want to learn more about this important customer service skill.

Introducing the “Resolving Complaints” series in the December Reporter, Carson cited flexibility as key to handling complaints – no one approach fits every situation, issue or personality. Nevertheless, he said there is a four-part process for thinking through the factors that go into perfecting this skill: Avoiding complaints; Receiving complaints; Performing revisits; and Resolving complaints. 

Increase the likelihood a client will be satisfied with the inspection, thereby decreasing the likelihood of a complaint. That’s one way to reduce the number of complaints that need to be resolved. We consider the following areas critical for avoiding complaints.

Invite the client to the inspection

We have found that clients who do not attend the inspection are more likely to complain. There are several advantages to having the client with you during the inspection. You can adjust any unreasonable expectations, explaining the scope of a professional home inspection. You have a chance to establish rapport with clients and earn their respect. Clients see how hard you work on their behalf. Many home inspectors say, “Friends do not sue friends.” While it may be a stretch to say that home inspectors become friends with their clients, there is a respect that can be earned over a 21⁄2-to 31⁄2-hour home inspection.

Another reason to invite the client is that verbal communication is better than written communication in many ways. While it is the report that will be relied on if a problem comes up, a face-to-face discussion provides for feedback and allows you to repeat or modify your comments to ensure good understanding. You may also customize your reports to reflect your conversations with the client.

Use a good contract

While we believe a good contract is important, we look at contracts differently than some. By sending our Authorization Form (we don’t call it a contract) to our client ahead of time, we give them a chance to ask questions before the inspection. It also saves us time at the beginning of the inspection by explaining the scope, adjusting expectations and getting an agreement signed. Clients are encouraged to sign and return the agreement before the inspection, providing us with the opportunity to take care of payment details before the inspection.

Including a copy of the ASHI Standards of Practice helps the client better understand the scope of the inspection and realize the rules of the game are well established, not something we made up.

Those crazy expectations
We can’t say it too often: We all need to create realistic expectations. Clients should know we are there to find big problems, the kind that would change their mind about buying the property. In looking for the big problems, we will trip across some small ones. Rather than ignore them, we report them, as a courtesy. The problem with this is that it creates the impression (and expectation) that we find every cracked pane of glass, loose tile, soft mortar joint, and so on.

Unless we explain this to the clients, who could blame them for expecting more? It is our responsibility to clarify the scope. Some inspectors say the inspection is a sampling process rather than an all-inclusive exercise. Some say they will not respond to any complaints below $500. Others define major problems as life safety items or items over $1,000, and respond only to those issues. Find your own way to get the message across, but make it clear.

The contract 
There are many contract wordings, and we encourage you to check with your attorney before settling on any. Keep in mind attorneys have a specific goal – to minimize your liability. Their goal is not to build your business success, and an attorney typically has no role in your marketing or customer service activities. Your goals may include business growth as well as liability control.

Many contracts have clauses to minimize the inspector’s exposure, including the following: 
  • Limiting the liability to a fee or similar low number (if allowed in your jurisdiction).

  • A statute of limitations that sets a restriction on how long people have to come after you for a problem (if allowed).

  • A counter-claim clause (clients who sue and lose, pay your costs).

  • A technically exhaustive inspection is available at a considerably higher price. (Designed to reinforce the idea that a home inspection has a limited scope.)

  • There are exclusions for radon, lead, mold, building codes, engineering work, concealed items, environmental issues or anything else you can think of.

  • The inspection is visual only.

  • There is no inspection of concealed areas.

  • The inspection identifies only conditions both present and apparent at the time of the inspection. Intermittent problems are not covered.

  • Our professional opinions are often based on inference because there is no direct evidence or incomplete information.

  • The inspection is not a guarantee or a warranty.

  • There is no responsibility if repairs are done before we can examine the property.

  • We are not responsible for betterments that put the client further ahead of where we told them they were. (For example, if a roof we said had five years left had to be replaced immediately, we should only provide a roof with 5 years of life remaining.)

  • The inspector is not liable for any consequential loss (if the roof leaks and destroys a $20,000 piece of furniture, the damage to the furniture is not our problem).

  • The contract is the entire agreement (anything we say in our advertising does not matter).

  • This contract replaces all previous representations (including what we may have said on the phone or on our Web site).
The purpose of the contract
Many say the purpose of a contract is to limit the inspector’s liability. We believe the purpose of a contract is to clearly communicate to the client the scope of the home inspection. Clients should understand what we can and can’t do. It is fair for them to hold our feet to the fire within that window of responsibility.

The goal of an agreement, in our opinion, is to have both the supplier and customer agree on the service to be delivered. It is the customer’s responsibility to pay for the service when it is delivered. It is the supplier’s responsibility to deliver the service. Our contract is short and attempts to explain in layman’s terms the scope of the inspection. We refer to the ASHI Standards of Practice because it is clear that the exclusions and restrictions are not specific to our company.

There is, however, a risk in rigidly defining the scope. If you clearly set out what you are going to do, and then perform services beyond this scope, your contract may be thrown out by a court. (“I told you we don’t do things like asbestos, but I thought you should know that there is asbestos on these pipes.”) If you report on things outside of scope, it can be argued that you should have reported on other things outside the scope as well, since you were clearly not serious about defining your scope.

Promotional materials

We believe promotional materials can be positive without over-promising. For example, offering “complete peace of mind” or a “total solution” may expose you to liability.

“When Things Go Wrong”

One of the best ways to handle complaints is to anticipate them. We include the document, “When Things go Wrong,” in our reports and remind clients of it when complaints come in. You’re welcome to use all or any part of it (see facing page).

Booking the inspection – a risk management opportunity

There is an opportunity to ask some risk management questions when an inspection is ordered. This is a great time to ask about and document specific concerns. Concerns outside the scope of the inspection can be identified at this stage, and clients can be advised as to where to get answers to these questions. We prefer to avoid telling clients,  “We don’t inspect for that.” We try to tell them where they can get answers to their specific issue. We also make it clear that when clients ask for things outside our scope, this is not part of a professional home inspection. We don’t want to leave the impression that other home inspectors may perform those services and that they have chosen a poor firm.

A conversation might go something like this:

Client: “We are concerned about the septic system.”

Inspector: “The evaluation of a septic system is not part of a home inspection. There are firms/septic contractors that specialize in this and we can coordinate a septic system evaluation for you, or refer you to a firm.”

There are several variations on this theme, and we encourage you to give some thought to this.

Good home inspectors don’t get complaints!

We thought this might catch your attention. Actually, we believe all home inspectors get complaints eventually. Why is this? Part of the answer may lie in our definition of a home inspection: Home inspection is a high-liability, in-depth, multi-disciplined technical analysis of the home conducted under adverse circumstances in front of a demanding audience, requiring the generation of an incredibly detailed written report prepared in an unrealistically short time frame for an inconceivably low fee.

Dos and don’ts at the inspection

The risk management process carries through the inspection itself. A good inspection is fundamental, of course, but it is also important to document special limitations, such as no access to a bedroom or roof space.

Be consistent
It is important to be consistent between your verbal comments and your written report. Many home inspectors have a tendency to understate problems face-to-face and describe them more harshly in the written report. This frustrates clients, and if there are witnesses, the written report may be dismissed as not representative of the inspection.

Don’t guess, bluff or ignore
Don’t guess about things you’re unsure of. If you come across something unfamiliar, say you will do some research and get back to the client. Don’t bluff your way through a discussion. If you are caught, this will undermine your credibility on all issues. You can’t afford to ignore things you don’t understand because they may have a significant effect on the property.

Don’t show off
Clients are not well served by home inspectors who use technical language to prove their knowledge. Home inspectors are in the communication business, and the best inspection is one that helps the client understand the condition of the home. You will be appreciated for your ability to make things understandable.

Don’t argue
Sometimes we’re challenged about technical issues by someone at the inspection. We believe it’s best to avoid a confrontation. Simply provide authoritative backup for your position in the report, and allow others their right to their own opinions. There is nothing to be gained from making one of the parties at the inspection look foolish. You can clarify your position for your client in private after the inspection, if
necessary.

Where does your loyalty belong?

We believe impartiality is a key to avoiding complaints. We are often asked to whom we are responsible or loyal during our inspection. Some say we are responsible to the client who pays our fee. Others say our responsibility is to the agent who brought us together with the client. Still others say that we are responsible to the seller whose home we are in. In our opinion, our loyalty lies with none of these. We believe our loyalty is to the home; we should represent its condition as accurately as possible to anyone who ever reads our report.

Pre-possession checklists

Some inspectors give clients a checklist to complete before taking possession of the home. This puts some responsibility on the client to identify visible defects. If a client later calls to complain about a stain, crack or bulge, the inspector points out to the client that he or she did not note it on the pre-possession checklist, so clearly it was not visible at the time of the inspection.


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When things go wrong

There may come a time when you discover something wrong with the house, and you may be upset or disappointed with your home inspection. There are some things we’d like you to keep in mind.

Intermittent or concealed problems

Some problems can only be discovered by living in a house. They cannot be discovered during the few hours of a home inspection. For example, some shower stalls leak when people are in the shower, but do not leak when you simply turn on the tap. Some roofs and basements only leak when specific conditions exist. Some problems will only be discovered when carpets are lifted, furniture is moved or finishes are removed.

No clues

These problems may have existed at the time of the inspection, but there were no clues as to their existence. Our inspections are based on the past performance of the house. If there are no clues of a past problem, it is unfair to assume we should foresee a future problem.

We always miss some minor things

Some say we are inconsistent because our reports identify some minor problems but not others. The minor problems that are identified were discovered while looking for more significant problems. We note them simply as a courtesy. The intent of the inspection is not to find the $200 problems; it is to find the $2,000 problems. These are the things that affect people’s decisions to purchase.

Contractors’ advice

A common source of dissatisfaction with home inspectors comes from comments made by contractors. Contractors’ opinions often differ from ours. Don’t be surprised when three roofers all say the roof needs replacement, when we said that the roof would last a few more years with some minor repairs.

“Last man in” theory

While our advice represents the most prudent thing to do, many contractors are reluctant to undertake these repairs. This is because of the “last man in” theory. The contractor fears that if he is the last person to work on the roof, he will get blamed if the roof leaks, regardless of whether or not the roof leak is his fault. Consequently, he won’t want to do a minor repair with high liability, when he could re-roof the entire house for more money and reduce the likelihood of a callback. This is understandable.

Most recent advice is best

There is more to the “last man in” theory. It suggests that it is human nature for homeowners to believe the last bit of expert advice they receive, even if it is contrary to previous advice. As home inspectors, we unfortunately find ourselves in the position of “first man in” and consequently it is our advice that is often disbelieved.

Why didn’t we see it?

Contractors may say, “I can’t believe you had this house inspected, and they didn’t find this problem.” There are several reasons for these apparent oversights:
Conditions during inspection   

It is difficult for homeowners to remember the circumstances in the house at the time of the inspection. Homeowners seldom remember that it was snowing, there was storage everywhere or that the furnace could not be turned on because the air conditioning was operating, et cetera. It’s impossible for contractors to know what the circumstances were when the inspection was performed.

The wisdom of hindsight
When the problem manifests itself, it is very easy to have 20/20 hindsight. Anybody can say that the basement is wet when there is 2" of water on the floor. Predicting the problem is a different story.

A long look
If we spent half an hour under the kitchen sink or 45 minutes disassembling the furnace, we’d find more problems, too. Unfortunately, the inspection would take several days and would cost considerably more.

We’re generalists
We are generalists; we are not specialists. The heating contractor may indeed have more heating expertise than we do. This is because we are expected to have heating expertise and plumbing expertise, structural expertise, electrical expertise, et cetera.

An invasive look
Problems often become apparent when carpets or plaster are removed, when fixtures or cabinets are pulled out, and so on. A home inspection is a visual examination. We don’t perform invasive or destructive tests.

Not insurance

In conclusion, a home inspection is designed to better your odds. It is not designed to eliminate all risk. For that reason, a home inspection should not be considered an insurance policy. The premium that an insurance company would have to charge for a policy with no deductible, no limit and an indefinite policy period would be considerably more than the fee we charge. It would also not include the value added by the inspection.

We hope this is food for thought.

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Alan Carson of Carson Dunlop is an ASHI Member and Past President. Carson Dunlop & Associates, Toronto, ON, offers home, commercial and home warranty inspection services, as well as educational services, reporting systems and the Home Reference Book. For information, call 800-268-7070 or visit www.carsondunlop.com .