Appraiser hired by lender owes a duty to buyer/borrower.

[CANative]

Just do your appraisals correctly and don't worry.

 

[Webbed Feet]

Try a different descriptive word

The bank has a fiduciary obligation to the borrower to extend credit in safe and sound manner, ie. in the best interests of the borrower, not just in the best interests of the bank. It obtains an appraisal as a part of this obligation.

For too many years, lenders have gotten away from this standard. This ruling is a double edged sword but one which I believe will inure to our benefit.

This has as much potential for increasing the standards of practice as any regulations we've seen in the past year.

We really need to learn what creates a fiduciary relationship, and what does not, on this forum.

 

[moh malekpour]

We really need to learn what creates a fiduciary relationship, and what does not, on this forum.

The fiduciary duty of the appraiser is the honesty, objectivity and impartiality in what the appraiser does in developing and reporting the appraisal. The appraiser is not an agent of any body.

 

[Webbed Feet]

<......snip......> In its unanimous decision, the Court of Appeals disagreed and allowed this case to proceed. The case opens the door for buyers to sue appraisers even when the appraiser was hired by the lender.

The opinion is based on a residential case, but does this also open the door for commercial litigation as well?

Click here to see the Court's published decision.
http://www.berkmoskowitz.com/documents/CV080331.pdf

The hell it does! The "door" to sue was already wide open! He got sued didn't he? Am I missing something here? Has Blagg been convicted? Has Blagg been found guilty? Post the part where the trial is over and this appraiser was found liable.

Ok, due to all the posts convicting Blagg before any trial is over, I doubt I'll finish reading all the posts in this thread.

Point in fact, at least by what has been offered in this thread, BLAGG IS NOT CONVICTED OF ANYTHING! The decision is simply to allow a case to go forward in order to determine if Blagg did anything wrong or not.

Honestly, having so many posting as if this changes precedents in case law already established from prior finalized cases is just surprising. Ok, Blaggs legal team did not succeed in getting the case squelched. That does not mean it is game over.

The next little point I would like to make is, even if Blagg loses, it's not game over. What our trade does is simply demand copies of sales contracts before we agree to assignments, or agree contingent to the sales contract language. The moment we find such language in a sales contract we............

A) Turn the assignment down;
B) Respond with an engagement contract of our own that causes the lender to indemnify and hold us harmless from the buyer and seller;
C) Respond with a nice lovely contract for the buyers and sellers that causes them to sign away any right of reliance on the appraisal, and acknowledge their unintended use. They indemnify and hold us harmless.... or;
D) we charge $2,000 for the appraisal services to account for the liability involved.

This ain't that tough folks! .... Look for that crap in the sales contracts, if it is in one, turn the assignment down or tell the parties involved, including the fricking lender/client.... guess what?! We have the power of the word..... NO

P.S.. Have I ever posted that it is WAY past time the residential side pulls it's head out of it's kister regarding formal, well written, Engagement Contracts? .. Have I? One thing I think I noticed posted I think I agree with. It is going to take lots of lawsuits before our trade finally decides to grow up and graduate from grade school.

 

[Webbed Feet]

The fiduciary duty of the appraiser is the honesty, objectivity and impartiality in what the appraiser does in developing and reporting the appraisal. The appraiser is not an agent of any body.

MOH!!!!!!

The duty of the appraiser under ADMINISTRATIVE RULES! Not "fiduciary duty." ... As you said, the appraiser is NOT an agent! .. Therefore, there is NO "fiduciary" about it regarding anything!

m2:

P.S... UGHHHHHHH! For hopefully the last time! We CANNOT be "Agents," because we are NOT allowed to be "Advocates!" An "Agent" must be an "Advocate." A "Fiduciary" duty would be a position requiring advocacy!!!!!!!!!!!!!!!!!!!!! So, as we are allowed to advocate for ONLY our own opinions, if you all want to go on saying you have a fiducary duty to yourself... Ok, ... have at it!

 

[NORTON]

what was the reason for the square footage difference, converted garage, attic, etc?

 

[Elliott]

I'm surprised the Appeals court made a ruling of law when apparently
the 'facts' of the case were not clearly determined and will now have to
be determined.

 

[timd354]

.

But I have confidence that those that practice in a scrupulous fashion can easily be defended. The differences in contrast are too great and obvious, even for sympathetic juries.

Calvin, you really have no clue as to how the legal system works and how juries in certain areas act. Please trust me when I say that there are certain places that facts just do not matter to the jury........and the appraiser will simply be seen by the jury as an outsider with deep pockets whose insurer can afford to pay the verdict....it is very sad, but that is just the way it works.

 

[timd354]

Just do your appraisals correctly and don't worry.

If it were only that easy...yours is a very naive view.

I was a litigator for 5 years and believe me that there is a very good reason that litigating attorneys call expert witnesses *****s. Trust me, if the door is opened for buyers to easily sue appraisers, plaintiff's attorneys will line up plenty of so-called USPAP and appraisal experts who will just be *****s that will find things wrong in reports, even there is nothing wrong in the reports or even if the reports were done in an overall credible manner with some minor erros and these minor errors will be blown up by the expert witness/***** into "evidence" of appraisal fraud, etc. If you think that you will find actual justice in the legal you are sadly mistaken. If you think that the appraisal system and the mortgage lending system are rotten, you should see the level of rot within the legal system in this country.

May God help anyone (including the innocent) in this country whose fate is the hands of a jury...as juries are not exactly composed of the more intelligent people among us.

 

[Ray Miller]

The hell it does! The "door" to sue was already wide open! He got sued didn't he? Am I missing something here? Has Blagg been convicted? Has Blagg been found guilty? Post the part where the trial is over and this appraiser was found liable.

Ok, due to all the posts convicting Blagg before any trial is over, I doubt I'll finish reading all the posts in this thread.

Point in fact, at least by what has been offered in this thread, BLAGG IS NOT CONVICTED OF ANYTHING! The decision is simply to allow a case to go forward in order to determine if Blagg did anything wrong or not.

Honestly, having so many posting as if this changes precedents in case law already established from prior finalized cases is just surprising. Ok, Blaggs legal team did not succeed in getting the case squelched. That does not mean it is game over.

The next little point I would like to make is, even if Blagg loses, it's not game over. What our trade does is simply demand copies of sales contracts before we agree to assignments, or agree contingent to the sales contract language. The moment we find such language in a sales contract we............

A) Turn the assignment down;
B) Respond with an engagement contract of our own that causes the lender to indemnify and hold us harmless from the buyer and seller;
C) Respond with a nice lovely contract for the buyers and sellers that causes them to sign away any right of reliance on the appraisal, and acknowledge their unintended use. They indemnify and hold us harmless.... or;
D) we charge $2,000 for the appraisal services to account for the liability involved.

This ain't that tough folks! .... Look for that crap in the sales contracts, if it is in one, turn the assignment down or tell the parties involved, including the fricking lender/client.... guess what?! We have the power of the word..... NO

P.S.. Have I ever posted that it is WAY past time the residential side pulls it's head out of it's kister regarding formal, well written, Engagement Contracts? .. Have I? One thing I think I noticed posted I think I agree with. It is going to take lots of lawsuits before our trade finally decides to grow up and graduate from grade school.

Good answer.

Working on my revesion today for all the AMCs, they have all got to sign off on it or no ticket for an appraisal. I am doing one general one to cover six months at a time. Attached will be my new fees.