As part of risk management, a commercial property inspector should steer clear of providing repair/replacement cost estimates as much as is practical when generating his/her report. However, sometimes that will be of the most interest to the client. There are two optimum ways for commercial inspectors to handle this. The first is to have the specialty consultants who helped with the inspection to produce a rough range of repair/replacement cost estimates. The other way is to charge the client to arrange for gathering repair estimates from local contractors.

In either case, CCPIA offers two sample clauses that can be added to an inspection agreement (between inspector and client) to help shield an inspector (and his specialty consultants) from claims related to repair/replacement cost estimates.

 

Option 1:

If the Inspection Report described above contains any estimates as to the costs associated with making any repairs, the Client understands and agrees that said estimates are included solely as a guide and are not to be considered, understood or utilized by the Client as representing the actual costs associated with making any such repairs.  The Client further acknowledges and agrees to hold harmless the Company in connection with any estimate(s) that may overstate or understate the actual cost of repair(s), even if said overstatement and/or understatement is due to the negligence of the Company.  Regardless of any such estimates, the Client should obtain further qualification of any cost estimates from an appropriate contractor, tradesperson and/or professional.

 

 

Option 2:

If the Inspection Report described above contains any estimates as to the costs associated with making any repairs, the Client understands and agrees that said estimates are included solely as a guide and are not to be considered, understood or utilized by the Client as representing the actual costs associated with making any such repairs.  The Client further acknowledges that this Contract is made in conjunction with the Inspector’s separate contract with a third party that agrees to faithfully and diligently perform the services consistent with the standards of practice in their professional community. Regardless of any such estimates, the Client should obtain further qualification of any cost estimates from an appropriate contractor, tradesperson and/or professional. Costs may vary in various markets and due to individual circumstances.

 

If the latter sample clause is used, an inspector should be using the Professional Services Contract (between the inspector and specialty consultant) because the sample clause reiterates points specific to that agreement.

Additional Commercial Inspector Resources:
Standards of Practice Online Course
Members Receive Up to 10% Off RS Means Purchases
Who Can Perform a Commercial Property Inspection? Video
Creating a Team of Expert Consultants for Your Commercial Property Inspection Business