The Fine Print

The big print giveth, and the fine print taketh away.

Q: " One of our lender clients has forwarded a new form that they want us to sign and submit with our commercial appraisals. Overall, I don’t see anything that causes me too much concern but the one section, entitled, "RELIANCE LANGUAGE", bothers me. It says I have to agree that the lender can give this report to any third party, at any time, without my knowledge or consent, and that this third party has my permission to rely upon the report. In addition, I have to agree to answer any questions about the report that might be posed to me by this third party. It seems to me that this language would expand my liability risk. Do you agree?"

A: Of course I do and I hope you are not really thinking about signing this. The lender is saying they can give your report to any one for any purpose and you are OK with that. Why should any party, besides your client, benefit from your work without having to pay you a fee? This could open your company up to claims from any number of parties who might have seen your report, and relied upon it, in connection with who knows what sort of transactions. I cannot imagine any circumstance where this could be beneficial to you, or to your company, in any way, whatsoever.

Would you like Claudia to manage your liability concerns?