At the time that the short sale was approved, the seller was no longer in the home, and the utilities were not on. The listing broker tells the buyer that the seller has no money to turn the utilities on for the home inspection and that the buyer should turn on the utilities. The buyer telephones the city to turn on the water, but when the city turns on the water, the home is flooded. The home inspector was unable to do the home inspection because of the flooding, and the buyer cancelled the Contract. Is the buyer liable to the seller for the flooding of the home?
No. In essence, the seller designated the buyer to be the seller’s agent to turn on the utilities. The buyer was never able to do a home inspection. Therefore, there is no liability of the buyer under lines 193-194 of the Contract for damages due to a home inspection.
Arizona REALTOR® Magazine – September 2011