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Who Said I Agreed To Be An Expert?

Appraisers continue to be confused about whether or not they have agreed to act as an expert witness in litigation situations. Over the course of the past few months, we have seen several such scenarios presented, all with somewhat similar facts. Two of those situations will be discussed below.

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In the first case the appraiser had appraised the subject property multiple times over the years. The subject was a single-family residence located in GA. The appraiser prepared a purchase loan appraisal in 2019 and a refinance appraisal in 2020. Both of those reports were done for the AMC/lender.

Later in 2020, the husband/property owner retained the insured to appraise the property in connection with a divorce proceeding. In 2021, the husband and his counsel reached out to the appraiser in connection with a property tax appeal. The appraiser had acted as an expert in several other tax appeals, so he had the requisite experience. He agreed that he would be willing to take on this assignment, but neither the appraiser, nor the attorney, took any further steps to confirm the assignment beyond one telephone conversation.

In September of 2021, a package of documents was delivered to the appraiser. He learned the tax appeal matter was scheduled to proceed to trial in less than 60 days. He was being asked to sign an enclosed engagement agreement, to prepare an opinion, and to get ready for trial. The appraiser was swamped with other work commitments and had no time to complete this assignment. He called the tax appeal attorney and said he could not sign the engagement letter. The attorney said his client had no time to retain another appraisal expert and would be forced to sue the appraiser for breach of contract unless he followed through on his agreement to act as his tax appeal expert.

In another case, an appraiser in Southern California appraised a beachfront luxury condo in 2015 and again in 2018. Both reports were done for the property owner. The intended use for both reports was stated to be simply “asset valuation.” In 2020, the appraiser was retained to appraise the property for the deceased owner’s estate for estate tax purposes.

In 2021, the appraiser was contacted by counsel for one of the deceased owner’s sons/heirs. He said the 2 sons were squabbling about what to do with the property and asked if she might be willing to prepare an appraisal and act as an expert, if needed. His client wanted to sell the condo but the other son wanted to hold on to it. He wasn’t sure if the sons would come to some agreement or if the dispute would wind up in litigation. The appraiser said she would be willing to act as an expert - and that was the last she heard from the attorney, and the last she heard of the dispute...until she was served with a subpoena.

The subpoena was served in connection with a lawsuit pending between the 2 brothers. The appraiser was being asked to produce her “workfile” including copies of all appraisals she had prepared of the subject property. She was also being asked to appear for a deposition. This was the first time the appraiser learned that she had been named as an expert witness for one of the brothers. When she called the attorney whom she had spoken to months earlier, he seemed quite annoyed that she was not ready to jump into her role as expert since she acknowledged that they had discussed it previously.

What can be learned from these examples is that an appraiser has to realize that any conversation with an attorney must be taken seriously, especially if the conversation has to do with whether or not the appraiser is being asked to act as an expert. The conversation cannot be treated as casual chit chat. If an attorney calls to discuss a case, it is an important call!

The appraiser should learn as much as possible about the potential expert witness assignment to make sure he/she is competent. The appraiser should always find out as much as possible about the parties involved to make sure there are no conflicts/potential conflicts.

The appraiser should ask about the status of the case in question to make sure he or she has enough time to commit to the assignment. Has a lawsuit been filed? Are there any upcoming dates already scheduled?

Most importantly, the appraiser has to determine at the end of the call, or soon thereafter, if he or she has been retained to act as an expert and that retention or the lack thereof, should be confirmed. The appraiser should not rely upon the attorney to do this. A simple email on the part of the appraiser can serve to clear up a great deal of confusion down the road. The appraiser should also ask for an engagement letter, or agreement sooner rather than later, to make sure whatever terms being proposed (hourly rate/flat fee/turnaround time, etc.) are acceptable.

If the appraiser sends an email thanking counsel for considering him or her and wishing them luck in their expert search, that attorney is going to have a hard time explaining how the appraiser wound up on the expert witness list 6 months later. Sending a confirming email avoids the misunderstanding that could arise when the issue is just left hanging. The attorney might think the discussion meant there was an “agreement” whereas the appraiser just thought it was a discussion and nothing more.

The appraiser always has to be alert to situations where they must protect themselves and their own interests and this is one such situation. Don’t get caught in a trap where you find yourself asking, “Who Said I Agreed To Be An Expert???”

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