In Bostick v. Orkin Exterminating Co., Inc., 806 F.2d 504 (4th Cir. 1986), an extermination company prepared a wood infestation report stating there were "visible damaged structural members" caused by a beetle infestation, but that there was "no visible structural damage." Bostick, 806 F.2d at 505.
Subsequently, the home purchaser discovered extensive structural damage and filed suit against the extermination company. Yet, disclaimers on the report stated structure that was not visible or accessible was not inspected. Id. at 506.
Additionally, the court observed South Carolina regulations governing wood infestation reports provide that a report "cannot be viewed as a structural damage report." Id. at 507 (quoting S.C. Code Ann. Reg. § 27-1085(k)).
The regulation reads, "If visual evidence of wood-destroying organisms or damage is noted in this report, further investigation for structural damage by qualified building experts is recommended." Id.
The court found that Bostick's case was built upon the cornerstone that he had relied on the report as a record of structural damage. Id. at 508-09. This was impermissible under the regulations, and, therefore, his fraud action failed. Id.