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Elderly-ish family member of mine sold her house and bought a townhouse 2 years ago.
Purchasers of her house, b/c someone messed up on the HUD statement, received her homestead rebate during the closing. Her lawyer, who we told her not to use, also missed it.
She was the one who found it but let it go because it would have been a huge headache and cost her more to get it back than it was worth. She was out of the country during the closing and gave her attorney power of attorney.
Two weeks ago she receives a call from "her lawyer" telling her that the survey company didn't get paid and they want their $500.
Two years after she closed on her new property.
She calls my husband, my husband calls the lawyer. The lawyer says he didn't make the mistake so he won't pay for it. My husband calls the title company. The same chick who processed/settled up the HUD statement was still working for the title company - so they had a conversation.
My husband asked her whose responsibility it was to make sure that the survey company fee was included on the HUD. She admitted it was hers but in the same breath said that it doesn't make her OR her company (the title company) responsible for her mistake.
My husband told her that when you screw up doing your job, it IS either YOUR personal responsibility or the responsibility of the company you work for to CYA.
She said he'd hear (meaning his family member) from the title company in house lawyer.
I see the two items as separate issues. Sorry to hear you lost out on the rebate. That's done and has little bearing on the other issue. Although, it would seem like win/loose.
As for the Survey Company, I would tell them to pound sand. It would appear to me that the survey cost should be assessed to the buyer as part of their due diligence. The fact that they are coming to collect 2 years later is ridiculous. I would tell them to be more careful next time.
I agree with the above. These are two separate issues, although they apparently highlight some incompetent amateurs in the proceedings.
Regardless, who incurred the survey expense to begin with?
Who expected to pay because they needed a survey and then engaged the surveyor or requested a surveyor to be engaged?
That is who should pay their service provider now.
Last edited by MikeJaquish; 02-27-2015 at 07:51 AM..
Regardless, who incurred the survey expense to begin with?
^^^^This is the primary issue. The survey company is an innocent party in this. They did the work, so they deserve to be paid.
In most of the closings I deal with, where the title company prepares the paperwork, the title company usually has the Buyer and Seller sign a form whereby they agree to rectify any mistakes that may have been made in the closing documents. Yes, it's unfortunate (and rather inexcusable) that the title company and the lawyer missed this expense at closing, but it doesn't change the nature of the underlying debt.
As for the homestead rebate, that is a separate issue...BUT, if they're going to correct the survey mistake you should also seek to correct the rebate mistake at the same time. I would think that the title company and the lawyer would be more on the hook for covering that mistake if the Buyer doesn't come through. Maybe that would help to balance the sting of paying out $500 for the survey at this late date.
The seller has to pay for a $500 survey every time a townhome is sold?? That seems ridiculous if there has been no additions or detached garage built or fence or something (highly unlikely on a townhome).
Whoever did the settlement neglected also to take out the money to pay the survey company. Yes, generally the buyer pays for the survey in states I'm familiar with.
I'm also aware a company will pull out the stops and bombard whoever they can reach when they are trying to get payment on their debt. Perhaps the buyer at that time is no longer reachable. Perhaps the company is now bombarding whoever did the settlement and the lawyer is trying to pass it off on whoever is his own easy target.
The seller has to pay for a $500 survey every time a townhome is sold?? That seems ridiculous if there has been no additions or detached garage built or fence or something (highly unlikely on a townhome).
Oh, and to answer your question, I would not pay.
It could have been a condition of sale...or it could have been a requirement for title insurance. It doesn't mean it would necessarily be a requirement on every sale.
^^^^This is the primary issue. The survey company is an innocent party in this. They did the work, so they deserve to be paid.
In most of the closings I deal with, where the title company prepares the paperwork, the title company usually has the Buyer and Seller sign a form whereby they agree to rectify any mistakes that may have been made in the closing documents. Yes, it's unfortunate (and rather inexcusable) that the title company and the lawyer missed this expense at closing, but it doesn't change the nature of the underlying debt.
As for the homestead rebate, that is a separate issue...BUT, if they're going to correct the survey mistake you should also seek to correct the rebate mistake at the same time. I would think that the title company and the lawyer would be more on the hook for covering that mistake if the Buyer doesn't come through. Maybe that would help to balance the sting of paying out $500 for the survey at this late date.
I would agree, but TWO YEARS AFTER? That's just wrong.
I know for some things there is a limit. Had a Anesthesiologist who worked on my husband's knee surgery send a bill three years after the surgery. There is a one year limit on medical billings and I called to talk to someone on his staff and said sorry, no. When he got nasty that's when I told him I knew the law and he could go pound salt. And if I was the Doctor, I'd be firing the idiot who is three years behind on his billing.
I've got an invoice that's four months old, and I am calling them for non payment. In this case I know it's an accidental oversight (they pay monthly, missed October, but have paid November's - January.) I'm not letting this go for two years.
Yes, but if it's within the statute of limitations, how would you feel about it if you were the survey company?
If I owned that survey company, I would feel like my accounting person needs to be replaced. If the bank hired the survey company, the bank needs to pay them.
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