When a termite company inspects a home, it typically records what it finds on a diagram — often called a "graph." Used honestly, that graph protects the homeowner. Used dishonestly, it can become a tool to deny valid claims by relabeling fresh termite damage as "old" damage the company was never responsible for.
Key takeaways. Termite inspectors document damage locations on a graph or diagram at the time of inspection. Honest graphing creates a baseline that helps everyone tell old damage from new. But a company acting in bad faith can exploit the practice — marking new damage as pre-existing, "losing" an original graph that would prove otherwise, or recharacterizing termite damage as water damage to escape a repair obligation under the bond. Alabama's Orkin Exterminating Co. v. Jeter is the marquee example, and it shows how such conduct maps onto Alabama's suppression statute and its punitive-damages framework.
What "graphing" actually is
A termite graph is a diagram of the structure on which the inspector notes the location and nature of what he finds: active infestation, mud tubes, prior damage, prior treatment, and inaccessible areas. On many forms, existing or pre-existing damage is marked at a specific spot, sometimes with an "X" or a shorthand note. The graph travels with the file, so that at the next reinspection the company can compare current conditions against the earlier baseline.
Done properly, this is a sound practice and a benefit to the homeowner. If the graph accurately records that a particular joist had old, pre-purchase damage, everyone knows that damage is not the company's responsibility going forward. Just as importantly, if the graph shows an area was clear at inspection and damage later appears there, the graph helps prove the damage is new — which is exactly what a homeowner needs when making a bond claim for a covered infestation.
How the practice can be abused
The problem arises when the graph is treated as a shield for the company rather than an honest record. A dishonest operator has several moves available:
- Backdating new damage as "old." When a homeowner reports fresh damage, the company marks it on the graph as pre-existing — an "X" indicating damage that supposedly predated the bond — so that it can deny responsibility for repairs.
- Losing the original graph. If the earliest graph would show an area was clear at inspection, "misplacing" that document removes the very proof that later damage is new.
- Recharacterizing termite damage. The company labels obvious termite galleries as "water damage," "wood rot," or "settling," none of which the termite bond covers.
Each of these tactics has the same goal: to avoid paying for repairs the company is contractually obligated to make. And each depends on the homeowner never seeing the company's own internal records — which is why these cases so often turn on documents.
Orkin v. Jeter in depth
The leading Alabama case is Orkin Exterminating Co. v. Jeter, 832 So. 2d 25 (Ala. 2001). It brings the abusive version of graphing into sharp relief.
In Jeter, the company's inspectors documented heavy termite damage to the home. But consistent with an internal practice, they did not disclose that damage to the homeowner. When the situation later came to a head, the original damage graph could not be produced — it had been lost — and the damage was mischaracterized as water damage rather than the termite damage the inspectors had actually recorded. The apparent purpose was to avoid the company's obligations under the bond.
The jury found this conduct actionable and returned a verdict of $800,000 in compensatory damages and $80 million in punitive damages. The trial court remitted (reduced) the punitive award to $4,000,000, and on appeal the Alabama Supreme Court addressed the excessiveness of that remitted punitive award.
Two features of Jeter deserve emphasis. First, the wrongdoing was not a careless inspection — the inspectors saw and documented the damage. The fraud lay in what the company did with that knowledge: concealing it, losing the proof, and relabeling the damage. Second, the size of the numbers — even after remittitur — reflects how seriously Alabama law can treat knowing concealment aimed at defeating a homeowner's contractual rights.
How this maps onto suppression under § 6-5-102
The Jeter pattern is a textbook illustration of suppression under Ala. Code § 6-5-102, which makes the suppression of a material fact that a party is obligated to communicate a form of fraud.
Consider the elements. There was a material fact — the existence and extent of active termite damage. There was knowledge of that fact — the inspectors documented it. There was silence — the company, per its practice, did not tell the homeowner. And whether there was a duty to disclose is analyzed under the six-factor test from State Farm Fire & Cas. Co. v. Owen, 729 So. 2d 834 (Ala. 1999): the relationship of the parties, their relative knowledge, the value of the fact, the homeowner's opportunity to discover it, trade customs, and the surrounding circumstances. A homeowner who hires a termite company for its expertise, cannot inspect inside the walls himself, and depends on the company's report has a strong case that the company was obligated to communicate what it found. (We walk through the fraud framework in detail in our companion article, "Fraud and Suppression in Termite Inspections: Alabama Law Explained.")
Where the company goes further and affirmatively recharacterizes termite damage as water damage, the conduct also implicates misrepresentation under Ala. Code § 6-5-101 and deceit under §§ 6-5-103 and 6-5-104. In short, the same course of conduct can support multiple fraud theories at once.
Why the graph is central to punitive-damages exposure
Concealing documented damage is exactly the kind of conduct that can move a case from ordinary breach into punitive-damages territory. Under Ala. Code § 6-11-20, punitive damages require clear and convincing evidence that the defendant consciously or deliberately engaged in oppression, fraud, wantonness, or malice. Knowing concealment of material facts — and the loss or alteration of the very records that would prove it — is the sort of deliberate conduct that can meet that heightened standard.
Alabama also caps punitive awards. Under Ala. Code § 6-11-21, punitive damages are generally limited to the greater of three times the compensatory damages or $500,000, with a higher cap for cases involving physical injury and special provisions for small businesses and wrongful death. These caps, together with constitutional excessiveness review, are why an enormous jury number like the one in Jeter was ultimately reduced. The lesson for homeowners is not that they will recover tens of millions of dollars — they almost certainly will not — but that Alabama law provides real teeth against companies that knowingly conceal damage. (For more, see "Mental Anguish and Punitive Damages in Alabama Termite Cases.")
What to do if you suspect your graph was manipulated
If you believe a company has relabeled new damage as old, lost a graph that would help you, or called termite damage something else, take these steps:
- Demand the complete file — in writing. Ask specifically for the original inspection graph, every reinspection graph, field notes, photographs, and prior reports. The pattern in Jeter — a "lost" original graph — is exactly why you want to request these records early and keep proof of your request.
- Do not repair or re-treat until the damage is documented. Repairs destroy the physical evidence that shows whether damage is old or new. Photograph and video the damage in place first. (See "Don't Repair That Termite Damage Yet: Preserving Evidence in a Termite Claim.")
- Get an independent inspection. A qualified independent inspector can document current conditions and offer an informed opinion about the age and cause of the damage — for example, whether what the company called "water damage" shows the galleries and mud characteristic of termites.
- Compare the graph to reality. If the company's graph marks an area as previously damaged but an independent inspector finds fresh, active damage there, that discrepancy is significant.
- Note your deadlines. Fraud and suppression claims in Alabama are generally subject to a two-year period, often running from when the fraud was or reasonably should have been discovered. Confirm your timeline with counsel rather than assuming.
- Consult a termite litigation attorney. Whether a graph discrepancy reflects an honest baseline or deliberate concealment is a fact-intensive question, and building it requires the company's own records.
Closing
The termite graph is only as trustworthy as the company that keeps it. In the right hands it is an honest baseline that protects homeowners; in the wrong hands, as Jeter shows, it can be turned into a device for denying legitimate claims. If your damage has been labeled "old" or "water damage," or if the company cannot produce its original graph, those are precisely the circumstances Alabama's suppression and punitive-damages law were built to address — and precisely the circumstances worth reviewing with counsel before you repair anything.
Talk to Yates Anderson
If a pest-control company has denied a termite claim, buried damage, or filed an inspection you believe was wrong, the analysis above only goes so far. Request a case evaluation and a Yates Anderson attorney will respond within one business day.
Informational only. Not legal advice. No attorney-client relationship is created by reading this post. Consult a licensed attorney in your jurisdiction.