It’s tough enough to start and run a business on your own. But factor in the occasional unhappy customer and our litigious society where almost everything that makes a person unhappy is deemed worthy of legal action, and you have a recipe for trouble.
Doing a thorough job on every inspection is always important. But there are other ways to protect yourself in case you end up on the wrong end of a civil suit.
Misrepresentation Compounds a Civil Suit
Ordinarily, when a customer decides to sue an inspector for an alleged error in an inspection, there’s a limit to what he can recover if he wins. The customer can’t recover attorney fees or litigation costs, according to Joseph Denneler, an attorney who writes for Working RE Magazine. But those costs can really stack up, so what’s a disgruntled customer to do? Find a way to claim misrepresentation.
In some states, consumer protection laws allow the plaintiff to recover legal fees if he can prove misrepresentation on the part of the defendant – the inspector. You might think that you’d never misrepresent your business in any of your advertising or social media, but it’s not very difficult to do. And attorneys are skilled at finding anything that can be argued as misrepresentation.
A Lapsed Membership Can Cost You
One of the most common misrepresentation claims is a false affiliation with a home inspector organization. And if it’s true, it’s also a winning claim in a lot of cases, says Denneler. But again, you would never claim to be a member of an organization if you’re not, right? But what if your membership merely lapsed?
An expired membership has been shown as evidence of misrepresentation. Further, it helps a plaintiff call your overall credibility into question. Going back to the initial problem, which is an error in the inspection report that might or might not be valid, an expired membership could be used to show that you are not credible, and that you deliberately misled the public with false information. It sounds harsh, but it is reality.
How You Can Protect Yourself
There’s no real way to prevent a disgruntled customer from hiring a lawyer and trying to recover some sort of damages. But if you’re diligent with inspections and cautious about your advertising and social media presence, your credibility will be stronger and you’ll stand a better chance of winning.
Working RE suggests the following for covering your bases:
- Check all of your contract materials for accuracy
- Go through your website, social media, and advertising materials to be sure that all of your claims are 100% factual
- Make sure you are compliant in every state and locale where you work.
You’ll also want to be sure that if you claim membership in any organization, your membership doesn’t lapse. Posting a membership emblem on a business card and your website is fine, just be sure that if your membership ever lapses, you adjust your advertising accordingly.
Lawsuits are big business. Nearly anyone who is unhappy with a company can find some reason to support the idea that suing them is the best way to resolve it. And when it comes to buying a home, emotions run high. So it pays to protect yourself in every way possible.
You can help manage customer expectations by thoroughly explaining what an inspection covers and what it doesn’t, and with a detailed contract that’s up to date. You might go your whole career without ever finding yourself in court. But if the worst should happen, having all of your ducks in a row is the best protection that you can get.
ICA School can help prepare you not just for working as a home inspector, but also for running your business successfully once you complete the program. If you’re ready to take the next step, enroll now and you could complete the program in as little as a few weeks.