Appraisal Port user agreement, now what?

[Mike Seward]

Morning, Tim.
You are addressing the issue of protecting yourself from YOUR negligence. The user agreement requires you to be responsible (and pay the costs to defend them) for THEIR negligence.

 

[DWiley]

If they ask why, tell them that E & O will not cover anything not secured like your pdf.

I am not fan of the new AP user agreement. However, I would not fight it by telling a client something that is not true.

The OP omitted the portion of the statement that clearly says that agreeing to the AP terms of use does NOT invalidate your E&O coverage. The response from the LIA attorney begins with:

First, an appraiser's decision to sign the agreement -- like the signing of any contract containing an indemnity clause -- does not void an appraiser's E&O coverage with LIA. To the contrary, the appraiser's E&O coverage remains unaffected and in place.

How can one twist those words into a claim the AP agreement voids E&O coverage?


It is true that the agreement addresses things not covered by E&O, but those things would not be covered regardless of whether or not one signed the AP agreement. E&O covers mistakes made by an appraiser, not business arrangements made for report delivery.


The statement contains clauses that IMO are unfair and increase appraiser risk. (Most hold harmless agreements do) However, it does not void my E&O.

As for "secure" PDF files, provide a "locked" PDF and I will demonstrate just how secure it is. I have a little program that will unlock a PDF in a few seconds. There are hundreds of such programs on the Internet. Unless you apply a real digital signature, the security in a locked PDF file is merely an illusion.

 

[DTB]

As for "secure" PDF files, provide a "locked" PDF and I will demonstrate just how secure it is. I have a little program that will unlock a PDF in a few seconds. There are hundreds of such programs on the Internet. Unless you apply a real digital signature, the security in a locked PDF file is merely an illusion.

There is a difference between locking your car and going in the store (despite the fact that locks can be broken and cars can be hotwired) and leaving the car unlocked w/keys in the ignition isn't there?

 

[Mike Seward]

Dan,
I don't know who implied that signing the agreement would void E&O coverage. I didn't.

But we're still addressing mistakes the appraiser makes. My concern is this part of the LIA attorney's letter:

"In the indemnity provision of this agreement, you are agreeing very broadly to pay all of AppraisalPort's losses, damages, expenses, etc. which might result from any aspect of an appraisal delivered through AppraisalPort
-- even if, the loss or damage is the result of AppraisalPort's own "sole negligence." In doing so, you are agreeing to pay potential costs and damages that are broader than can be covered by your insurance.
Indeed, as an example, you are agreeing to pay for losses not only due to your own potential mistakes, but also due to AppraisalPort's own negligence (if AppraisalPort, for example, chopped up one of your reports or deleted important information) and agreeing to pay AppraisalPort to defend against its own negligence. "

Above and beyond that, my original question to the forum was only this:

If you have decided you are not going to sign the agreement and you have good clients that use AP, what are you going to do?

 

[Offshore]

"In the indemnity provision of this agreement, you are agreeing very broadly to pay all of AppraisalPort's losses, damages, expenses, etc. which might result from any aspect of an appraisal delivered through AppraisalPort
-- even if, the loss or damage is the result of AppraisalPort's own "sole negligence."

That's the part that concerns me. Plus, what if you win? You still have to fly to Missip, pay a lawyer out of your own pocket and hope for the best. I realize that by worrying this means I must see black helicopters hovering around. Actually that seems to be the standard insulting line used by the software bullies who are attempting to ram the system down our throats. To the good people of Missip, I love your state; I just don’t want to visit it to defend myself due to a “glitch” in some software program.

 

[Jon D. Quinn]

Back to the original (yet unanswered) question: is there anyone out there that has good bank clients that use AP and who has decided not to sign the agreement? What do you plan to do?



I do have a Bank client that uses AP. I have spoken with GeneralStar and they wrote to me saying they are fimiliar with the agreement and it doesnt affect my coverage. However, after reading what I have I am of the thought............I'm so confused!!! I will be checking with the client soon.

 

[DWiley]

The risks involved in agreeing to the terms of use are real; they are not black helicopters. Appraisers should be trying to obtain more favorable terms, but they should not do so by making false statements like, "Signing this voids my E&O," or "E&O will only cover PDF files." One cannot build a credible position with false information.

 

[Elliott]

Jon asked, ...is there anyone out there that has good bank clients that use AP and who has decided not to sign the agreement? What do you plan to do?

The idemnity problem has been around for years. Because one attorney put it in the
contract, the next attorney puts it in (cause they copy). I've done a number of
things, sometimes I email them (and usually get the "all the other appraisers sign it"
response, to which I say, "I'm not like all the other appraisers."). Sometimes I've
"X-ed" it out and sent it in. With AP it says, sign it or get dropped, so I've decided
not to sign it. Eventually one of my six AP Clients will try to order an appraisal and
find out I'm not on the approved list...and they'll want to know why.

I'm not all that worried about it. The lending side of appraisal is in cardiac arrest
currently and the AMCs have squeezed fees so low I don't even get the fee quote
call. It will have to get worse before it get better. I can see the day I'll say,
"Gee sorry, mortgage loan, I haven't done one of those in years, I don't think
I even have the current forms anymore. ....No, I don't really know any appraisers
that are doing mortgage appraisals."

 

[DTB]

The risks involved in agreeing to the terms of use are real; they are not black helicopters. Appraisers should be trying to obtain more favorable terms, but they should not do so by making false statements like, "Signing this voids my E&O," or "E&O will only cover PDF files." One cannot build a credible position with false information.

Those positions are best left for those running for political office or appointed positions.

 

[Tudor]

Regarding the E&O Insurance. Will they cover costs that arrive from errors and omissions cause by someone else? I think that is the question that needs to be asked. I'm not asking, because I refuse to help these companies by working for or thru them.