Featuring America's Home Inspector: Nationally Syndicated Columnist, Barry Stone

Contractor Loses Job Over Asbestos Bid

Dear Barry:  I hope you don’t mind another asbestos question. As a general contractor, I was bidding on the remodel of an old home. The ceilings had acoustic texture, sometimes known as “popcorn,” so I included the costs of testing and possible asbestos removal in my bid. The homeowners complained that two other contractors had also bid on the job and that neither contractor had mentioned asbestos. Because my bid included the additional costs, I did not get the job. What do you think of this?  Bob

Dear Bob:  Contractors who did not consider the possibility of asbestos in their bids may not realize that they are exposing themselves to financial liability and potential lawsuits.

Most of the acoustic ceilings installed from the 1950’s through the 1970’s contain asbestos. If the texture material is intact, it is not regarded as a significant health hazard. When removal or demolition takes place, the law requires that the material be tested and that handling, removal, and disposal be done by a licensed asbestos abatement contractor.

The homeowners who received your bid were informed by you of a potential problem, but chose to overlook it, supposedly for financial reasons. In so doing, they made a serious misjudgment, exposing themselves and others to a possible health hazard.

In a similar situation, several years ago, a remodeling contractor removed acoustic ceiling texture from a home without advising the owner of possible asbestos. Fabrics throughout the house, including carpets, drapes, upholstery, and clothing, were later found to be contaminated with asbestos fibers. All of these had to be sent to a toxic waste site, and the contractor was held to be financially liable for the losses.

The homeowners in your recent situation were not prudent in their decision. Hopefully, they will not come to regret that choice.

Asbestos Pipe Insulation Not Disclosed

The House Detective: by Barry Stone, Certified Home Inspector

Dear Barry:   My home was built in 1926 and has asbestos insulation on all the hot water pipes under the building. Fortunately, all of this asbestos has been wrapped. When I first learned about it, I was horrified and wondered why my home inspector hadn’t mention it when I bought the property. My main concern is what will happen when I eventually want to sell the home. Can I resell it in this condition, without penalty?  Am I required to have the asbestos removed? And also, do I have recourse from my home inspector for not mentioning the asbestos?  Judy

Dear Judy:  Asbestos pipe insulation was common in the 1920s and is not regarded as a significant health risk when it is undamaged and intact. Fortunately, the asbestos insulation in your home been encapsulated, rendering it in much safer condition than when it was exposed to the air.

As a seller, there is no requirement for removal of asbestos, and there are no penalties for merely having it. Your only requirement will be to provide full disclosure to prospective buyers, to let them know that the asbestos material is present. If the former owners were the ones who had the pipes wrapped, they probably knew about the asbestos and should have provided some disclosure.

Environmental hazards such as asbestos are not within the scope of a home inspection. However, competent inspectors who take their work seriously will often point out situations where the presence of asbestos is likely, such as insulated pipes in an old home. This is something that your home inspector would have been wise to do, even though not required to do so.

Seller Worried About Environmental Hazards

The House Detective: by Barry Stone, Certified Home Inspector

Dear Barry:   I am concerned about environmental hazards in my home — about lead paint, asbestos ceilings, formaldehyde in treated wood, etc. etc. But I’m not very knowledgeable about these things. I’ve read just enough to be scared to death! Now we are planning to sell our home, built in 1978, and are concerned about what may have to be disclosed to buyers. What do you advise?  Kim

Dear Kim:    Given the age of your home, formaldehyde in plywood and other wood products is an unwarranted concern. After this many years, formaldehyde will have dissipated from wood laminates and finish materials. If you have installed newer materials, formaldehyde is a possibility, but this is not something a homeowner would be expected to know or disclose. Only an environmental inspector with specialized testing equipment could be expected to provide such information.

Textured ceilings in a 1978 home are likely to contain asbestos, but this type of asbestos containing material is not hazardous if left alone. Asbestos fibers only become airborne when the material is disturbed. If you or your buyers want to have the texture removed, it should be tested first to determine if special handling and disposal are required.

Asbestos can also be found in some vinyl flooring materials and some drywall finishing products. Again, this is only a concern if the material is to be removed, in which case testing would be needed.

The manufacture of lead paint was banned in 1978, but it’s use continued until supplies of the material were used up. Therefore, your home may have some lead paint. However, lead paint is only hazardous if ingested. Its mere presence is not unsafe. On the other hand, if exterior lead paint has been allowed to peel, chips may have contaminated the soil around the building. In that case, professional testing would be needed to determine if disclosure and remediation disclosure are needed.

The potential for asbestos and lead in your home is something you can disclose to buyers, with the understanding that you do not know for sure whether these substances are actually present.

Home Inspector Overlooked Furnace Problem

The House Detective:  by Barry Stone, Certified Home Inspector

Dear Barry:Before we bought our home, we hired an ASHI certified home inspector. We were with him for most of the inspection, but he didn’t spend much time looking at the furnace, and now we have a major problem. The inspection report says the system is “normal,” whatever that means, and recommends “routine maintenance and cleaning.” When we moved in, we hired a heating contractor to clean and service the unit, as recommended by the inspector. The heating guy removed the cover panel and found large rust holes on the inside. The unit puts out carbon monoxide, so it has to be replaced. All our home inspector did was shine a flashlight into a small opening, without removing the cover panel. When we called him about this, he said, “I told you to have the heater cleaned before closing escrow.”  But the inspection report says nothing about before the close. Do you think our home inspector was negligent?  Randy

Dear Randy:  Inspecting a furnace without removing the cover panels is grossly negligent. It makes as much sense as a podiatrist examining your feet without first removing your shoes. If a home inspector or foot doctor is conducting a diagnosis, visual access is essential.

If your home inspector is certified by ASHI, the American Society of Home Inspectors, he must comply with ASHI Standards of Practice. According to these standards, “the inspector shall inspect the installed heating equipment.” And the definition of “inspect,” according to ASHI standards includes “opening readily openable access panels.” Therefore, failure to remove the access panels on your furnace was a violation of professional standards.

If the heating contractor was able to see rust damage merely by removing the access panels, then your home inspector should have discovered the damage and should now take responsibility for a substandard inspection. If he recommended cleaning and servicing the furnace prior to close, that recommendation should have been in the written report. Verbal recommendations that differ from the written report are legally invalid.

The next question for you home inspector is, “Do you have errors and omissions insurance?” If not, you might consider small claims court.

Dear Barry: We were about to buy an old home until we learned that it has asbestos shingle siding. We’ve read that this material is safe if it is not damaged, but we’re worried about future problems. What do you recommend?  Lane

Dear Lane: Asbestos shingle siding was commonly installed in the 1940’s and early 50’s. It consists of a material knows as transite, a mixture of cement and asbestos fibers. Transite is not regarded as a significant health hazard because it does not release asbestos fibers into the air unless it is ground into dust with power tools.

If you intend to remove or alter the transite shingles, handling, removal, and disposal should be assigned to a specially licensed professional, and this can be very costly. When you eventually resell the home, the presence of asbestos material must be disclosed, and this can adversely affect the interest of some buyers (just as you were deterred), regardless of the relative safety of the material.

Buyer Takes Issue With Seller’s Disclosure Statement

The House Detective:  by Barry Stone, Certified Home Inspector

Dear Barry: I recently made a purchase offer on a house. The seller’s disclosure statement listed no defects, but the offer was contingent on a clean home inspection report. So I hired a home inspector and also ordered an appraisal for a total cost of $700. When I read the inspection report, I couldn’t believe the number of major issues that needed attention, from standing water under the building to rotted wood on the roof. Because of this, I’ve decided not to buy the house. Since the seller’s disclosure statement listed no defect, is he liable for the money I spent on the inspection and appraisal?  Dan

Dear Dan: Unless you can prove that the seller concealed known defects in the disclosure statement, he is not responsible to reimburse your costs. The purchase contract was contingent on your acceptance of the home inspection report. Therefore, your only options are to cancel the transaction or renegotiate the contract.

Reliance on seller disclosure statements is usually disappointing. In most cases, disclosure statements are worth less than the squares of toilet tissue they might have been printed on. A home inspection report, if properly prepared by a qualified professional, will always reveal more than a disclosure statement.

In most cases, sellers are simply unaware of defects in their homes, although there are instances where sellers deliberately conceal known defects. The seller in your case may never have looked under the building and may have been totally unaware of the drainage problem. Likewise, he probably never walked on the roof or crawled through the attic, and therefore had no idea that the wood was rotted.

It is unfortunate that you hired an appraiser before you reviewed the home inspection report. The appraisal should have been done after you considered the physical condition of the property. That would have limited your nonrefundable expenses.

Dear Barry: When we bought our home, the sellers prevented our home inspector from inspecting the attic. They simply told him that there was no access, and he merely confirmed this in his inspection report. We later discovered that the access was on the wall of the master closet, behind some clothes. Our concern now is whether we have asbestos insulation in our attic. If so, are the sellers liable for asbestos removal?  Kim

Dear Kim: The sellers must have known about the access panel in the closet, although they may not have realized it was the entry to the attic. On the other hand, there may have been some attic issues that they wanted to hide. The answers to these questions may never be known. The main focus now is to inspect the attic for possible defects.

Asbestos in the attic is only likely if the home dates back to the early 1970’s. At that time, asbestos was used for air duct insulation and for flue pipes. It was not used, however, to insulate attic spaces. Attic insulation typically consists of fiberglass, rock wool, or recycled cellulose.

The one error that was made by your home inspector was to confirm the lack of an access with no further comment. The disclosure in the inspection report should have been: “No attic access was found. It is recommended that an access be made to enable completion of this inspection.” (or words to that effect)