The Well and Septic Contingency was updated on July 1 and then in August. Why was that? As you know, NVAR typically releases forms twice a year, January 1 and July 1. However, in this instance they were flooded with concerns about the form. As a result, the NVAR Forms Committee went back to the BOD at its next scheduled meeting because it felt that the form as released in July required immediate modification.
The septic contingency which was released in July had the option of either a seller or a buyer being able to select the inspector. This was a last minute addition. The form as originally presented by the NVAR Forms Committee for approval included only the option for the buyer to select the septic inspector. It quickly became clear that the change had caused some profound inconsistencies in the form. By way of example, if a seller elected to select the inspector, there was no mechanism or obligation for the seller to provide a copy of the inspection report to the buyer or any mechanism to negotiate any repairs. The form as it was originally drafted by the NVAR Forms Committee only had the option for the buyer to pay for and select the septic inspector, and thus the rest of the form was based on this assumption.
Many on NVAR Standard Forms Committee, as well as those on the NVAR BOD, work with septic systems. This change was made by informed real estate practitioners and with the cooperation of septic inspectors and was the result of many months of discussion and consideration.
It is important to remember the context of these changes. Not that many years ago a septic inspection consisted of a walk over inspection and the seller paid someone, who often had little to no formal training, to do it. Then pressure from the membership compelled the NVAR Forms Committee to list more invasive inspections for the buyers to choose from and at that time the market place was concerned about unearthing the system and the liability it created. At this stage, the NVAR Forms Committee decided to move the cost and liability to where it believes it belongs – the person who benefits from the inspection, the same process we have for every other inspection in the contract.
It is also important to note that nothing prohibits the buyers from negotiating the Seller to pay for the inspection, it just won’t be the default position.
As the new form is released and used into the marketplace, please provide your local association with feedback as to what works and what does not. As they do with all our forms, NVAR will monitor its usage, any unintended consequences and modify as needed.