Case Title: Ash v. All Star Lawn and Pest Control

Citation: 

Docket Number: 972711

State: virginia

Court: Virginia Supreme Court

Date: 1998-11-06T00:00:00Z

Document:
Present: All the Justices 
 
KENNETH R. ASH, SR. AND 
 JOYCE A. ASH 
 
 
 
OPINION BY 
v.  Record No. 972711 
JUSTICE LAWRENCE L. KOONTZ, JR. 
 
 
 
November 6, 1998 
ALL STAR LAWN AND 
 PEST CONTROL, INC. 
 
 
FROM THE CIRCUIT COURT OF THE CITY OF PORTSMOUTH 
James A. Cales, Jr., Judge 
 
 
In this appeal, we consider whether the trial court 
properly ruled that purchasers of real property could not 
recover under a claim of breach of contract against the 
inspection company for failure to provide an adequate termite 
and moisture damage report on behalf of the seller as required 
as a condition of the sale of the property. 
 
Under well-settled principles, we recount only those facts 
necessary to our resolution of the appeal.  On January 3, 1994, 
Kenneth R. Ash, Sr. and Joyce A. Ash (the Ashes) completed the 
purchase of a home in Portsmouth.  The contract of sale required 
the Ashes to take possession of the home “as is.”  However, as a 
condition of the sale, the seller agreed to provide the Ashes 
with 
an approved VA/FHA wood destroying insect report from 
a licensed pest control operator prior to Settlement 
Date showing the Property’s principal dwelling and 
garage to be free of visible wood destroying insect 
infestation with no visible unrepaired damage from 
said infestation.  Said report shall also indicate 
that readily accessible areas of the foundation and 
understructure including crawl space, sills, joists, 
subflooring and substructure support timbers to be 
free of standing water and/or visible moisture damage.  
Cost of inspection and required treatment and repairs 
shall be paid by Seller. 
 
 
The seller contracted with All Star Lawn and Pest Control, 
Inc. (All Star) to provide this inspection report.  Jeffrey C. 
Stuart, owner of All Star and a licensed pest control inspector, 
conducted an inspection of the home on December 18, 1993 and 
completed a standard form reporting the condition of the home.  
In that report, Stuart noted that he had found and repaired 
existing moisture damage in two locations outside the home. 
 
Section 7 of the form Stuart used to make his report 
included a pre-printed statement that the “[a]ttic, interior of 
walls, under floor coverings and behind appliances” were 
inaccessible areas and obstructions and, thus, were not subject 
to inspection.  In addition to the areas listed in the printed 
portion of section 7, a handwritten notation made by Stuart 
indicated that areas of the “Crawl Space - Behind Air Ducts” 
were also inaccessible. 
 
Section 11 of the form consisted of four disclosures made 
by All Star, the first three of which are relevant to this 
appeal:  
A. The inspection covered the readily accessible areas 
of the property, including attics and crawl spaces 
which permit entry.  Special attention was given to 
those accessible areas which experience has shown to 
be particularly susceptible to attack by wood 
 
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destroying insects.  Probing and/or sounding of those 
areas and other visible accessible wood members 
showing evidence of infestation was performed. 
 
B. The inspection did not include areas which were 
obstructed or inaccessible at the time of inspection 
. . . . 
 
C. This is not a structural damage report.  Neither is 
this a warranty as to absence of wood destroying 
insects. 
 
 
Section 10 of the form provided space for the inspector to 
make additional comments.  In that section, Stuart noted that 
there was evidence of treated and repaired termite damage, but 
did not identify the location where this was observed.  He 
further indicated that there was “no visible structural moisture 
damage in crawl space.”  Stuart charged the seller $1,010 for 
his services, which included a $35 fee for the inspection and 
$975 for repairing and repainting the areas where unrepaired 
moisture damage had been observed. 
 
The crawl space was 18 inches in height.  Portions of it 
were obstructed by sheet metal air ducts suspended between the 
floor joists and the ground.  Stuart subsequently testified that 
these areas were inaccessible to him because “I’m six-one and at 
the time I was 260 pounds.”  Stuart further testified that he 
attempted to see beyond the air ducts and tested the accessible 
area by probing the wood with a claw hammer. 
 
Stuart conceded that he was able to get 10 feet into the 
crawl space, and that he attempted to look beyond the air ducts 
 
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using a flashlight.  He maintained that he did not observe any 
unrepaired moisture or termite damage anywhere in the crawl 
space.  The Ashes introduced a photograph of the area of the 
crawl space in front of the air ducts that shows a screwdriver 
pressed into a floor joist as a probe to establish the existence 
of moisture damage. 
 
The Ashes signed the purchasers’ acknowledgement at the 
bottom of the form on the day of settlement at the office of the 
closing attorney.  At trial, Kenneth Ash testified that he had 
“no recollection” of reading All Star’s report at closing, 
saying “[w]e were just told [to] sign the papers.  We [were] 
going to be here all night if you had to read everyone of them.”  
Joyce Ash testified that she would not have signed the report if 
she “had been told there was anything wrong with it.” 
 
In September 1994, the Ashes employed Stuart M. Zenzel, a 
civil engineer and licensed pest control inspector, to reinspect 
the home.  Zenzel testified that upon entering the crawl space 
he was able to observe unrepaired moisture damage in the area in 
front of the air ducts.  This was the area that Stuart had 
conceded he had been able to enter and inspect at the time of 
his inspection.  Zenzel, who is of a slighter build than Stuart, 
was able to move beyond the air ducts to the back areas of the 
crawl space and discovered significant termite and moisture 
damage in those areas.  Zenzel further testified that all of the 
 
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damage he discovered was not of recent origin and would have 
been visible at the time of Stuart’s inspection. 
 
As a result of Zenzel’s report, the Ashes contracted with 
Wright Construction Company, Inc. for a structural evaluation 
and estimate for cost of repairs to the home.  Joseph A. 
Fosnock, an estimator for Wright Construction, confirmed the 
existence of the damage discovered by Zenzel and estimated the 
cost of repair at $16,900. 
 
On January 23, 1995, the Ashes filed a motion for judgment 
against All Star seeking damages of $18,500.  In that pleading, 
the Ashes alleged that they were third-party beneficiaries of 
the contract between the seller and All Star. 
 
The matter was heard by the trial court in a bench trial on 
September 29, 1997.  At the conclusion of all the evidence, the 
trial court ruled that All Star’s report “clearly indicated 
[Stuart] couldn’t get to every place, that every place was not 
read[ily] accessible.”  Accordingly, the court determined that 
the Ashes were on notice that the report was incomplete and 
could have required a further inspection.  Noting that “[c]aveat 
emptor still applies in Virginia,” the court entered judgment in 
favor of All Star.  We awarded the Ashes an appeal. 
We begin by noting that although All Star initially 
contested the Ashes’ claim of being third-party beneficiaries of 
the contract between the seller and All Star, that issue was not 
 
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raised at trial.  During oral argument on appeal, All Star 
conceded that it did not challenge that assertion at trial or 
assign cross-error for purposes of raising the issue on appeal.  
Accordingly, for purposes of this appeal, we accept that the 
Ashes were intended third-party beneficiaries of the contract. 
The Ashes assert that the trial court erred in ruling that 
All Star could insulate itself from liability by disclaiming on 
the report that certain areas were accessible.  In conjunction 
with this argument, the Ashes further assert that the trial 
court erred in construing the statements in the report in favor 
of All Star. 
We agree with the Ashes that merely making a broad and 
generalized disclaimer on a termite inspection report following 
a casual or defective inspection does not automatically insulate 
the inspector from contract liability.  To hold otherwise would 
render the report useless.  The inspector, in preparing the 
report, undertakes the obligation to report clearly and 
effectively the existence of damage to the structure inspected.  
See Baird v. Dodson Bros. Exterminating, 217 Va. 745, 749, 232 
S.E.2d 770, 773 (1977).  Inherent in that obligation is the 
corresponding duty of the inspector to explain clearly and 
effectively any impediments encountered in making a thorough 
inspection through the use of clear disclaimers and disclosure 
of his failure to inspect specific areas of the structure.  
 
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Where this is done, the inspector will be insulated from 
liability.  However, the evidence presented in this record does 
not support the trial court’s judgment that an adequate 
disclosure was made in this case. 
The evidence clearly showed that the area behind the air 
ducts in the crawl space was not “inaccessible” in the same 
sense as other areas excluded from the report, such as interior 
walls and areas beneath permanent floor coverings that are not 
traditionally subject to inspection.  These latter areas are 
“inaccessible” for visual and physical inspection because access 
to them would require structural alterations.  By contrast, here 
the sole cause of the area behind the air ducts being 
inaccessible was, as Stuart conceded, that his large physical 
size prohibited him from going over or under the air ducts.  At 
best, Stuart’s disclaimer was ambiguous.  At worst, it was 
misleading.  In either case, the disclaimer did not effectively 
explain the circumstances surrounding Stuart’s limited 
inspection or give notice to the purchasers of the property that 
a thorough inspection of the area would not otherwise require 
structural alterations. 
Moreover, while the report states that there was “no 
visible structural moisture damage in [the] crawl space,” the 
evidence at trial clearly showed that unrepaired damage was 
readily apparent in the area of the crawl space accessible to 
 
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Stuart.  Thus, notwithstanding his disclaimer, he simply failed 
in his contractual obligation to discover and disclose the 
unrepaired damage in the accessible area of the crawl space.  
Accordingly, the evidence in this particular case does not 
support the trial court’s conclusion that All Star complied with 
its contractual obligations.  Code § 8.01-680. 
For these reasons, we will reverse the trial court’s 
judgment, and, because the trial court did not reach the issue 
of damages, remand for further proceedings consistent with this 
opinion.*
Reversed and remanded. 
                     
*Because of our holding on the issue addressed, we do not 
address the other issues raised by the Ashes in this appeal. 
 
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