Pre-purchase Inspection Contracts

Beware and Aware of the Fine Print
Before you hire an Inspector, ask if you are required to sign a Contract. If so, ask to see the Contract. The Inspection industry in New Brunswick is unregulated and Contracts not standardized. In fact, it would appear that only Franchises have contracts.

The purpose of the Pre-Purchase Inspection is to protect the Purchaser NOT to meet and remove the Inspection Condition of the Offer.
If the Purchaser is not impressed with the Report's quality or is disatisfied with the terms of the Contract, he or she is being asked to sign, it is likely too late (not to mention expensive) to hire another Inspector

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EXAMPLE ONE
Visual Inspection Agreement
Pillar To Post Inc.
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Sentences from the first page
'Inspector is not responsible for the non-discovery of any patent or latent defects in materials, workmanship, or other conditions of theProperty, or any other problem which may occur or may become evident after the inspection time and date.'

'Inspector and its employees are limited in liability to the fee paid for the inspection services and report in the event that Client or any third party claims that Inspector has not fully satisfied all its obligations hereunder.'

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Sentence taken from second page
Any controversy or claim between the parties hereto, arising or directly out of, connected with, or relating to the interpretation of this Agreement, the scope of the services rendered by Inspector, the Inspection Report provided to the Client by Inspector, or as to any other matter involving any act or omission performed under this Agreement, or promises, representations or negotiations concerning duties of the Inspector hereunder, shall be submitted to binding arbitration in accordance with the applicable rules of the American Arbitration Association, or the Canadian Association of Arbitrators, as the case may be.'

A copy of the complete Pillar to Post Inc. Visual Inspection Agreement was provided to the Real Estate Board of Fredericton Area Inc. on June 23, 1997, for distribution to its member Brokers.

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EXAMPLE TWO
Agreement
AmeriSpec, Inc.
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Quotes taken from Section entitled
"Dispute Resolution And Remedy Limitation"
(from 2nd page of Agreement)
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Sentences taken from the 2nd page of
Agreement, paragraph entitled
"Notice Requirement"
'In addition, you agree that if you have any complaint that is not resolved by us and you wish to file an action against us, you must begin that action by filing a claim for arbitration with a professional arbitrator agreed to by both parties, as set forth in the next section, within one year of the date of the Report If you fail to file a claim with such an arbitrator within one year of the date of the Report, you agree your failure to do so releases us from any further liability we have to you under this Agreement and as to the services provided.'
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Paragraph entitled
"Binding Arbitration"
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'Each of us agrees that any dispute between us, except those for non-payment of fees, that in any way, directly or indirectly, arise out of, or relate to this Agreement or to the interpretation of this Agreement, the scope of the services provided to you, the Report, or any other matter involving the services we perform, shall be settled in accordance with the Rules of the Conduct of Arbitrations of the Arbitration and Mediation Institute of Canada, Inc., in effect at the date of the commencement of such arbitration, by an arbitrator appointed in accordance with the said Rules.'

If no arbitration proceeding is initiated by either parties to this Agreement within one year of the date of the Report, the failure to initiate the arbitration proceedings will be considered conclusive evidence that the parties are satisfied that each has properly and completely performed their obligations under this Agreement.'

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Paragraph entitled
"Limited Liability"
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'If we, or our employees, inspectors, or any other person you claim to be our agent, are careless or negligent in making the inspection and/or preparing the Report, our liability to you is limited to the fee paid for the inspection services, and you release us from any additional liability. There will be no recovery for secondary or consequential damages by any person. By signing this Agreement, you agree to this limitation on our liability.

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If you have encountered similar fine print, please contact us us.

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