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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