You could manufacture lead lifejackets with military precision and zero manufacturing defects, but they would still be a poor idea.

As long as you're brokering in Texas, you cannot simply ignore a very recent professional inspection report and claim ignorance of the alleged defects claimed therein.

The first step is to go into the office of the construction official, and see what if anything has been permited, inspected, and what special requirements they might impose for getting the work done.There is a good chance as @Ron Drake stated that the work done is not compliant, failed inspection, or is somehow defective.

I bought the house "as is," but does the seller have any liability since he had to know about the defect and didn't disclose it?

(b) No action to recover damages for any deficiency, defect, omission, error, or miscalculation in a survey or plat shall be brought against registered surveyors or their employees engaged in the practice of land surveying who performed or furnished such survey or plat more than six years from the date of the survey or plat.

You never really know if there may be some hidden title defect until you get the report back.

But you run the risk of creating title defects that have to be corrected later.  

@Adam:Depending on which of the Drake models you are considering, they score relatively well on the MaP test, though be warned that most of them are not HET nor WaterSense certified, so will not help reduce your water consumption.Champion does not appear to have submitted their models for testing.We have been using Niagara Conservation 1.28usg single-flush HET, flapperless model for the past couple of years (MaP score >1000) in all our renovations and replacements ... installed more than 30 so far and have had one with a defective fill valve ... which the supplier replaced in an hour.

I don't know if or how laws in MN differ from in TX, but here it's assumed that MF investors are sophisticated, and should rely on their own due diligence for uncovering defects.  

I can generally control any contract with individuals so I'm less concerned with hidden defects, title matters or condition as I have recourse all the way to settlement.