Home Inspector Liability – Who’s At Fault

Published on 29 August 2022, 07:22:56 AM

You made the offer to purchase conditional on a satisfactory home inspection. Now you’re worried about who’s at fault if the home inspector makes a mistake. 

What recourse you have if imperfections come to light after a real estate deal is done depends on how the home inspection contract is written. 

Be careful how you word a home inspection clause in Ontario. 

What Do Home Inspectors Look For 

Home inspections are optional when you buy a home or land in Ontario. Insist on it if your realtor or real estate lawyer doesn’t first. The cost is insignificant compared to the long-term expense you could incur if anything is seriously wrong with your new property.

Home inspectors look for visual signs a home needs repairs or upgrading:

• water damage from leaky pipes or aging gutters
• damage to exterior surfaces, like bricks that need repointing (mortar)
• foundation cracks
• soil movement that could cause building failure
• pests or wildlife intrusions
• the age and condition of plumbing, electrical services, or insulation
• ould, mildew, or ventilation problems.

Can a buyer back out of a purchase agreement in Ontario? 

Who’s Liable?

If the Contract is Poorly Worded

Watch out for limitations in your home inspection contract. Your contract includes what types of problems the inspection will address. Pay attention. Limitations may be unenforceable if you weren’t aware of them before an inspection began.

What to include in the purchase agreement in Ontario. 

If Defects are Found After a Home Inspection.

Patent Defects vs Latent Defects

Home inspectors are liable for patent defects not found during a visual inspection, but not latent defects (those not ordinarily discoverable during a reasonable inspection and investigation). Patent defects are obvious, noticeable imperfections like a cracked window or hole in a wall.  

Buyer’s checklist. Preparing for your home inspection.

Specific Concerns

Before signing the contract, inform your home inspector of specific concerns you want investigated, such as checking for mould. Home inspectors are obligated to address specific issues you raise. Their final report must clearly warn you if your concerns have not been addressed. 

FAQS on Suing a Home Inspector

1. Can you sue a home inspector in Canada?

You may be able to sue a home inspector for negligence. Before you talk to a real estate lawyer:

• Check your contract for “exculpatory clauses”. They exclude your inspector from being sued for any reason.
• Read the fine print to see if the inspector is liable for damages caused while the contract is in force, or negligence that causes future problems.
• Look for references to “the entire agreement” that can excuse home inspectors from a wide range of legal wrongs. 
• Review limitations of liability clauses that cap damages payable to you. 

2. Is there any legal recourse for home inspectors’ mistakes?

Courts assume an exculpatory clause excuses contract breaches or acts of negligence unless:

• the clause doesn’t apply to your legal action, or 
• including the clause in the contract was unfair or unethical, or 
• the clause violates a public good, such as having clean air. 

Read the Tercon Construction Ltd. v British Columbia court decision.

Vague or confusing language can make a home inspection contract legally unenforceable. Even if the court upholds the exclusion clause, you may still have a case under tort (contract) law if:

• the inspector misrepresented the services being provided, or
• defrauded you by saying the home was fine when they knew otherwise. 

3. Are home inspectors regulated in Ontario?

They will be, under Ontario’s Home Inspection Act, 2017. The Act was passed, but not yet in force as of April 2022. It requires home inspectors to be licensed, insured, and qualified. And it sets standards for inspection reports, contracts, disclosures, and an inspector’s performance. 

4. Where can I find home inspectors near me?

• Canadian Association of Home & Property Inspectors 
• Ontario Association of Home Inspectors 
• Ontario Association of Certified Home Inspectors 
• National Home Inspector Certification Council. 

Why You Need a Real Estate Lawyer

Axess Law reviews the agreement of purchase and sale for clauses that protect your buyer’s right to a professional home inspection. We go over every detail in your contract. 

Your Axess Law licenced real estate lawyer points out terms and conditions that affect your ability to close real estate transactions on time. We include clauses that protect your financial interests, and fix errors or omissions you may not have noticed. We make amendments if needed, and negotiate to extend completion dates if needed.

When to amend your agreement of purchase and sale.  

Your property title transfer (Ontario) is concluded on time, so you can take vacant possession when you planned. 

Affordable Real Estate Lawyers, Anywhere You Are 

Access lawyers for less in Greater Toronto Area, Ottawa, or by remote video conference. 

Our flat fee rates are affordable, and all inclusive (excluding taxes, disbursements, and third-party charges). Your final invoice includes no surprises, or hidden charges. Your itemized statement of adjustments is explained when we deliver it, and we answer any questions you have about it. 

You can get independent legal advice, or add a family member to a property for a modest title transfer lawyer fee. Axess Law offers you only the legal services you absolutely need. 

Find a real estate lawyer in Ontario. 

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Using a remote real estate lawyer. 

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