e091020 Do I disclose what I know from previous inspection?

Identifier: e091020

Date: 12/15/2009

Question

If I inspected a home in the past and was privy to info about a past minor fire (told to me by the previous buyer/current seller), am I obligated to or forbidden to disclose this information to the new client/buyer? Past client (current seller) did not disclose the past fire in his current disclosure statement. Current listing agent for this home was also the listing AND buyers agent at the past transaction. This agent also knew of the past fire. If I don't disclose what I know about the home, do I open myself up to added liability for not disclosing information that I know of the home should the buyer find in the future that I knew of the fire and I didn't tell him), or am I still required to protect the original inspection findings only for the then client (current seller)? 

Response

For information on potential liability, state laws will take precedence over ASHI Standards, and given the wide variations between individual states laws concerning these matters, ASHI recommends that members consult an attorney in their state of practice to determine the legal responsibility the inspector has to the various parties in the transaction.

With that said, the committee finds that the inspector is required to fully inform the current client of all information he has about the property that may be germane a to client’s purchase decision. An inspector assisting a purchaser in performing due diligence must disclose any information obtained about the property regardless of the source of that information. To properly navigate this situation, the inspector should first inform the current client (purchaser) of the previous inspection for the current owner (now seller) and have the current owner (seller) sign a release, allowing the inspector to reveal any information obtained during the first inspection. After the release is signed, the inspector should then disclose all results from the first inspection.