Withdrawing an Appraisal Report

[Mountain Man]

It may depend somewhat on state law.
In GA, if you take a post dated check, that is the equivalent to giving them an un-secured loan. You would have no recourse.

But if it is not a post dated, and you did not agree to such terms, then it is fraud. Go file a claim with the Sheriff. Once you have a judgment, go find some asset, like their car :wink: , that you can take. Had to do that once. When the wrecker rolled up in their yard to take the Mercedes (we discovered was paid off ) they suddenly found the $$$. :roll:

 

[maitca]

To Mr. Hatch:

May I respectfully disagree, in part, with one of your conclusions?

The Mangement section of the ETHICS RULE treats contingent compensation. There are five (5) specified contingencies which this section proscribes. None of them specifically (or implicitly) admonishes against making an appraisal or appraisal report contingent on getting paid a contractually owed professional fee that results from the normal course of business. Indeed, to quote Ted Slack, MAI, CRE (and a lot more initials) "...the purpose of the appraisal is to get paid...".

Now I want to agree with you in part. The ETHICS RULE, lines 250 to 252 (2002 edition of USPAP) specifically mentions "honesty", although in a somewhat different context than the one others have mentioned in related posts. Is one dishonest act best answered by another? I think you are correct when you respond that it is not.

Thanks! and a Merry Christmas and Happy New Year to all!

Tim Andersen

 

[George Hatch]

Tim,

It was not my intention to suggest or advocate that appraisers should be required to work for free or that working for free is somehow more noble than working for a fee. Except for those rare instances where I agree (in advance) to work for free, I believe in getting paid for every assignment I perform. Any legitimate means of collection are alright in my book. That's why I suggested a couple other methods of collection in one of my prior posts.

It's the conditioning of the appraisal report on getting paid after it's already completed that causes me some trouble. There's a difference between not accepting an assignment because you aren't going to get paid and taking on an assignment but planning in advance to condition your completed work product subject to payment. I just can't see how inserting a new condition in the appraisal report tying the validity of the opinion of value to the appraiser's compensation (or lack thereof) can be allowable under the Ethics Rule. Putting that issue aside, the bigger problem is the other implications that such a condition raises, all of which can be read to cast doubts on the appraiser's impartiality. If we openly cast doubt in the report on whether or not we're going to get paid and make the finished appraisal report contingent on it, how can we demonstrate that our work product is not advocating our clients desired result to better facilitate the payment? Can you imagine what an attorney would do with such a clause in an appraisal report? I can.

Lawyer: Mr Appraiser, I notice your appraisal report includes a condition that the report is not valid unless you get paid. Is this a standard appraisal condition that you use in every report?

Appraiser: Yes, it is

Lawyer: Do you commonly take on appraisal assignments where you don't get paid?

Appraiser: No, but sometimes it happens.

Lawyer: What would cause this to happen?

Appraiser: Well, sometimes the property owner (or borrower, or LO) doesn't have the cash.

Lawyer: Is that the only reason? Isn't it true that once in a great while your clients won't pay you because they can't use the results of your report. Not because your work is in any way deficient, but because if the value is too low there is no loan. Has this ever happened to you?

Appraiser: Well, yes...

Lawyer: So in these cases, if the value opinion were high enough to allow the client to do what they wanted to do, you'd probably get paid, right?

Appraiser: Well, yes....but I'd never do that, it's against my professional ethics.

Lawyer: I'm sure. Moving on; if your payment is in doubt, then how do we know that you'll actually perform within your "professional ethics"? How can we believe that you're doing what you're supposed to be doing without undue influence? How can we know that you won't move the value opinion to suit your clients needs?

Appraiser: Because I certify that my work is unbiased.

Lawyer: Your word is your bond, right? Then we should just take your word for it that you aren't shading your report so that you'll get paid. You know, when I read this, I get the impression that if the deal falls through for non-appraisal reasons that you'll just walk away from the fee. That the appraisal is only good if you get paid, so if your client doesn't get paid there is no need for the appraisal and you won't need to get paid. In fact, couldn't you say that your payment is actually contingent on whether your clients desires are realized?

Appraiser: Well, I certify that my work is unbiased......

And so it goes. I'm sure a professional litigator could ask better questions than that. You can see that no matter what the appraiser says to any of those questions, it ends up looking like the quality and integrity of their work product is tied not to their ethics, but to their fee. I'd be willing to bet that at least most of the state appraisal boards will see it that way, too. That's why I advocate to keep separate the business aspect from the appraisal and appraisal report.


George Hatch

 

[maitca]

Mr. Hatch:

Thank you for your post. According to my limited understanding of USPAP, it just assumes that the appraiser will be properly compensated after the completion of the appraisal and its submission in report form to the client. Given this assumption, it does not address the problem of not getting paid, nor does it address the appraiser's post-appraisal efforts to do so. Indeed, it should not, since this is a function of an appraiser's business, but not appraisal practice, the latter of which is all USPAP treats.

In this light, I agree with you with your conclusion as to the ethics of a non-payment condition as you have set it forth in the attorney/witness dialogue. To come back to the client after the fact and try to slip in another limiting condition is misleading ("Why didn't you tell me this in the first place!?"), against which USPAP constantly admonishes.

To claim, after the fact, that the appraiser has recently found "new evidence" that now calls into the question the reliability of the value opinion is self-defeating. Such a step impeaches the integrity and competency of the appraiser ("The appraiser could not get it right in the first place?!"). Further, it is a lie. As we all are aware, USPAP encourages honesty.

This is not to say the a non-paying client is not to be prosecuted to the fullest extent of the law. But that is the point. Let the law handle the problem. Its wheels grind slow but fine.

Then the appraiser should FIRE that slimebucket of a client, get ones who pay timely, and learn to manage the accounts receivable better.

Thanks! Happy and Merry!

TIM



[/u]