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Editor’s Note:
Many appraisers are diversifying into expert witness work; many
others need polished courtroom skills in order to defend their own
reports. In either case, understanding depositions and court
testimony is essential for today’s appraiser.
This story is excerpted from the new Working RE print
edition, mailing to 80,000 appraisers in February.
Depositions
and Court Testimony By Phil Spool, ASA
Whether testifying as an expert
witness on someone’s behalf or in defense of your own appraisal
before a state licensing board or judge, your keys for success are
the same.
Depositions
Testimony in a deposition is recorded
by a court reporter and is part of the official transcript. It is,
therefore, as important as testimony at trial. Although a judge is
not present at a deposition, your testimony may be read back at
trial, especially if the two versions are not consistent. In cases
involving your own work, opposing counsel is generally trying to
determine what you know about the issues or what you did. This is
known as “discovery.” They also are trying to establish “benchmark”
testimony, hoping to find inconsistencies between your statements in
deposition and at trial, in order to discredit you as a witness.
(story continues below)
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(story
continues)
Court Testimony
The courtroom is the place where
decisions are made. This is also where the attorney who hires you
will be asking you questions. If you are hired as an expert witness,
the first set of questions will probably be from your attorney to
get you approved as an expert. Your attorney is trying to
demonstrate your knowledge and expertise. They will ask your name,
the type of licenses you have, how long you have been appraising,
your education, specialized training/expertise, any disciplinary
actions or complaints against you, membership in any professional
organizations and whether you testified before in a court
proceeding.
There are basically two types of
courtroom trials: (1) a jury trial and (2) a bench trial. In a jury
trial, the jury determines the outcome of the case. In a bench
trial, the judge makes the final determination and there is no
jury. The players in court are the Trier of Fact (can be a
jury or judge), the plaintiff’s attorney, defendant’s attorney,
plaintiff, defendant and expert witnesses.
Expert Witness As an expert witness, you
need to be objective and not biased toward your client. Not everyone
is capable of being an expert witness. You will be called to testify
about your knowledge, skills and experience in the subject matter.
Sometimes opposing counsel will ask you under oath if you are being
paid for your testimony. A proper reply is, “No, I am being paid for
my time, education and expertise.”
As an expert witness you are getting paid. Obviously,
when defending your own appraisal you are not. In
either case you must be prepared prior to the deposition
and especially before trial. Being prepared includes
understanding your property fairly well, including going
out to the subject and comparable sales just prior to
the deposition and/or trial to refresh your memory.
Being called as an expert witness to provide court
testimony might be the result of a divorce involving
ex-clients: you may be called to establish the value of
the divorcing couple’s home at the date of purchase.
You can be sued for any number of reasons. Today
appraisers are sued by lenders as a result of a borrower
defaulting on their loan. Appraisers also are sued by
the buyer of a property whose value has plummeted due to
a declining market. The first step, of course, is to
make sure that your report is good enough to defend in
court. If you have errors and omissions (E&O) insurance,
then you will have the benefit of having your legal
representation paid for. Remember, if you plan on
dropping your E&O insurance ask your agent about
prior acts coverage. Attorney’s fees are not cheap.
One attorney who represents residential appraisers
indicated to me that the average legal fee representing
either an appraiser or the insurance company in a
lawsuit from beginning to end is around $75,000 and
considerably more for a commercial appraisal.
In part two of this series, What’s in Your Workfile
(WorkingRE.com, Library, Issue 25), I stressed the importance of
arranging your workfile in an orderly fashion and keeping all your
support information in the file. Multiple Listing Service (MLS)
documentation should also include a copy of the interior photo pages
of the comparable sales, either printed in color or black and
white. One attorney told me, “Paper is cheap, defending yourself is
not.” He said that when he once asked a defendant why he did not
maintain interior photos of the comparable sales, in order to
support his conclusion about the physical condition of the
comparable sales, the defendant replied, “It would be too costly to
make copies for all my files.”
David
Brauner Insurance Services/ OREP/Working RE Magazine
David
Brauner Calif. Insurance License: 0C89873
(story continues)
Dos and Don’ts of Deposition and Testimony
The list of dos and don’ts regarding testifying is
endless. However, I find the following are the most
valuable:
Prior to Trial: Assist and prepare your attorney
with appropriate questions to ask you. Be prepared. Look
over your workfile and, if time permits, revisit the
subject and comparable properties. Make sure that the
report you submit to your attorney is the one admitted
or used as evidence in the case.
At Trial: Tell the truth. Don’t make up an answer
if you don’t know how to respond. As an expert witness,
objective and truthful testimony is expected. Answer
questions you know personally. Evidence based on the
report of others, rather than the personal knowledge of
a witness, is referred to as hearsay and is
generally not admissible as testimony. You can overcome
this by forming your own conclusions based on
information you obtain. For example, if asked how you
arrived at an adjustment for the swimming pool, your
answer should not be that it is based on discussions
with Realtors who specialize in the area but that it is
based on your opinion after discussions with
Realtors who specialize in the area.
Take your time answering the questions. Listen carefully
to what is being asked, pause before answering (your
attorney might object to the question) and answer with
authority. If your attorney makes an objection, wait
until the objection is resolved before answering the
question.
At a jury or bench trial, occasionally look at the jury
or judge when answering questions. They are the ones
deciding your credibility and the outcome. I was
involved in a case where the appraiser/expert witness on
the opposing side made a statement that raised the
eyebrows of the judge and caused a surprised facial
expression. This should have been a clue to the expert
witness that the judge did not believe his statement.
Look at the jury to see if they seem to understand and
agree with you rather than looking bored or confused. Be
polite and courteous to the opposing counsel but don’t
be intimidated either. Dress neatly and look like the
professional that you are.
Trial Don’ts
Don’t provide an answer that you cannot back up. If
asked a question by opposing counsel, proper answers
besides “yes” or “no” might include: “I don’t recall (or
remember)” or “I don’t know” (if true statements). Don’t
expand your answers to impress anyone. Be concise and to
the point. Don’t volunteer information. Don’t continue
talking when you’ve finished your answer, if the
opposing attorney does not speak up right away. Don’t
raise your voice or argue with the attorney asking the
question. Don’t act as an advocate, unless you are
defending or advocating the correctness of the opinion
of value to the jury or judge.
It should be obvious by now why all three elements in
this series are vital to mitigating risk: the engagement
letter (Doing It Right: Engagement Letters,
WorkingRE.com, Library, Issue 24) sets the stage for a
good appraisal; a well-documented workfile provides a
solid defense when needed (What's
in Your Workfile?,
WorkingRE.com, Current Issue),
and whether you are diversifying your practice or
defending your license, learning the dos and don’ts of
depositions and court testimony are essential to eluding
trouble.
Look for this entire story in the upcoming print edition
of Working RE magazine, mailing to
80,000 appraisers in February.
About the Author Philip G. Spool, ASA, is a
State-Certified General Real Estate Appraiser in
Florida, appraising since 1973. Formerly the Chief
Appraiser of Flagler Federal Savings and Loan
Association, he has been self-employed for the past 18
years. In addition to appraising, he is an instructor
with Miami Dade College, teaching appraisal courses and
continuing education. He is Vice President and Chairman
of real estate programs with the Greater Miami Chapter
of the American Society of Appraisers. He can be reached
at
pgspool@bellsouth.net.
