Can it be an EA if it cannot be found to be false ?

[glenn walker]

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Speaking of which . . . does evidence exist of a scenario when an appraiser's use of an EA was actually useful, as pertains to liability ?

I can think of one or two cases but they were Commercial Properties or Land Appraisals and not done for lenders.

 

[Terrel L. Shields]

The problem with any EA would be that if someone else manages to find a concrete answer, that you didn't largely because you failed to really look for it...then you may be in for a rude surprise in a court setting. Example. You EA that you "assume" there are no adverse easements, but the next appraiser finds that upon simply going to the courthouse a plat shows a sewer easement crosses right thru the middle of the lot. (real situation where I was appraising a basket of lots a developer bought. He didn't realize there was such an easement that rendered one lot totally unbuildable. He had paid full retail of it.)

So you assumed away something that perhaps your "peers" would have went the extra mile for. And I am going to say "peers" is a badly abused term. What your "peers" in a court setting would do might differ wildly from that of a lending situation.

 

[Meandering]

The HC is made that the subject is a 3 story home.
The EA is made that nobody will look at the photo, and will just believe what you say.


.

 

[George Hatch]

The problem with any EA would be that if someone else manages to find a concrete answer, that you didn't largely because you failed to really look for it...then you may be in for a rude surprise in a court setting. Example. You EA that you "assume" there are no adverse easements, but the next appraiser finds that upon simply going to the courthouse a plat shows a sewer easement crosses right thru the middle of the lot. (real situation where I was appraising a basket of lots a developer bought. He didn't realize there was such an easement that rendered one lot totally unbuildable. He had paid full retail of it.)

So you assumed away something that perhaps your "peers" would have went the extra mile for. And I am going to say "peers" is a badly abused term. What your "peers" in a court setting would do might differ wildly from that of a lending situation.

This is an example where USPAP laying out the 2-part test out provides the defensible position for an appraiser so long as they're working to specs.

From an appraisal standards perspective, merely being "wrong" isn't proof of an inadequate SOW for that assignment, no matter how much soapboxing the attorney is doing. There are regs in your state licensing act which designate USPAP as the standard of conduct for a licensee and a judge doesn't get to just ignore that statute in favor of their interpretation of consumer law. Either you or your atty would have to be sufficiently familiar with both USPAP and the regs to connect those dots, but once you're there opposing counsel is facing an uphill battle to hold the appraiser to some "must have perfect knowledge" expectation which was never part of the appraiser's assignment.

Any critic would have to demonstrate that trip to the courthouse as being a typical action as would be performed by a peer *for that type of assignment* as well as a typical expectation by the users for that type of assignment. Moreover, what's typical for AR may not be typical in CA.

Meaning, the expectations for a 1004p performed for a mortgage lender will be measured on what's typical for *that* type of appraisal assignment, not what's typical for an appraisal that is intended to be used in court, or even what's typical for a FHA 1004 or conventional 1004. "Appraiser's Peers" don't refer to all appraisers, just the ones who are competent in that type of assignment.

 

[Terrel L. Shields]

a judge doesn't get to just ignore that statute in favor of their interpretation of consumer law.

Based on my conversation any number of times with a (retiring) judge, that is not true. A judge is free to hold any professional to a standard of due diligence prescribed by law, and USPAP is guidance, but the due diligence test is superior. After all USPAP is clear that the SOW must be adequate and that is a judgment made by others, not the appraiser.

This is a case where the board was overturned. The investigator claimed an appraiser violated USPAP. Three other appraisers agreed to testify that it did comply with USPAP. But the Supreme Court upheld the lower court overturning the board decision.

We direct our review not toward the circuit court but toward the decision of the agency. That is so because administrative agencies are better equipped by specialization, insight through experience, and more flexible procedures than courts, to determine and analyze legal issues affecting their agencies. McQuay v. Ark. State Bd. of Architects, 337 Ark. 339, 989 S.W.2d 499 (1999). Our review of administrative decisions is limited in scope. Such decisions will be upheld if they are supported by substantial evidence and are not arbitrary, capricious, or characterized by an abuse of discretion. In re Sugarloaf Mining Co., 310 Ark. 772, 840 S.W.2d 172 (1992). These standards are consistent with the provisions of the Administrative Procedure Act, Ark. Code Ann. §§ 25-15-201–214 (Repl. 2002), which require that the scope of appellate review under the Act be limited. According to the Act, it is not the role of the circuit courts or the appellate courts to conduct a de novo review of the record; rather, review is limited to ascertaining whether there is substantial evidence to support the agency’s decision or whether the agency’s decision runs afoul of one of the other criteria set out in section 25-15-212(h).​

 

[George Hatch]

Our review of administrative decisions is limited in scope. Such decisions will be upheld if they are supported by substantial evidence and are not arbitrary, capricious, or characterized by an abuse of discretion.

Again, you're referring to the curts finding that the state board is acting capriciously.

An appraiser adhering to THE standard of practice upon which their appraisal licence is regulated - and as recognized as THE appraisal standard by both the feds and the State - that situation has no parallels to the state board run amok and making it up on the fly. If a judge questions that I'd ask why they're trying to put me into the no-win position between my professional standards and licensing requirements vs whatever unknown and unknowable standard of appraiser performance the court is attempting to impose on me after the fact.

Just because your state board was using the "I can't define it but I know a bad appraisal when I see one" conduct in *violation* of USPAP doesn't render USPAP irrelevant.