Reference no: EM131675016

Question: The Finches hired Inspectech to perform a home inspection of a property they were purchasing. The contract they signed included a clause that read: "It is understood and agreed that the COMPANY [Inspectech] is not an insurer and that the inspection and report are not intended to be construed as a guarantee or warranty of the adequacy, performance, or condition of any structure, item or system at the property address. The CLIENT [the Finches] hereby releases and exempts the COMPANY and its agents and employees of and from all liability and responsibility for the cost of repairing or replacing any unreported defect or deficiency and for any consequential damage, property damage or personal injury of any nature. In the event the COMPANY and/or its agents or employees are found liable due to breach of contract, breach of warranty, negligence, negligent misrepresentation, negligent hiring or any other theory of liability, then the liability of the COMPANY and its agents and employees shall be limited to a sum equal to the amount of the fee paid by the CLIENT for the inspection and report."

After the inspection, which reported no significant defects, the Finches purchased the house. Within one week of closing, the Finches discovered water damage; prior repairs to correct said water damage; and water infiltration in the basement of their new home as well as structural problems affecting the house's foundation. The Finches alleged that these defects were not obviously visible because of the location of a workbench owned by the sellers. They sued to recover the $39,000 they had to spend to repair the water and structural damage. Based upon this contractual language, the circuit court awarded summary judgment to Inspectech, concluding that the release prohibited the Finches from asserting their claims against Inspectech for damages they claim were occasioned by Inspectech's failure to identify and disclose various defects in their new home. The court concluded that the clause was unambiguous and conspicuously placed in the contract and that the Finches had specifi cally agreed to its terms and its inclusion in the parties' Inspection Agreement contract. On what grounds do you think the West Virginia Supreme Court overturned the granting of summary judgment to Inspectech?