The Settlement Agreement specifically acknowledges that “JPMorgan Chase estimates it could be exposed to equitable claims of more than ten thousand brokers, agents and/or appraisers in Evaluation Solutions’ network for accounts payable by Evaluation Solutions.” However, the Agreement goes on to state that Chase believes it is indemnified against “claims, losses, liabilities, and any other costs and expenses incurred as a result of third party claims.” (Read the full text of Settlement Agreement at WorkingRE.com; Sidebar, Chase Settlement Agreement) 

Nick Conteduca is working with other appraisers and agents/brokers who have contracted with lawyer Breck Milde, an expert in both real estate and bankruptcy law, whose law firm will appear in court in Florida to oppose the Bar Order. Milde has also filed a class action lawsuit against Chase alleging that the bank is responsible for the unpaid fees due to appraisers and agents/brokers.  "We do not believe that the Bankruptcy Court has the authority to adjudicate the rights of the real estate professionals who performed services for the benefit of J.P. Morgan Chase Bank, N.A., and that it is appropriate for that Court to abstain from adjudicating such matters," says Milde.

Appraisers and agents affected are encouraged to join the case. “I speak with appraisers and agents regularly on these issues. We are in contact but it’s hard to get the word out to everybody,” says Conteduca.

To help pay for Milde’s $5,000 retainer fee to stop the Bar Order, Conteduca set up a donation page and asked appraisers to contribute toward the retainer. Within a day of Working RE first reporting the story, many appraisers had contributed to the cause, including Dave Biggers, Founder of a la mode, who personally donated the entire $5,000 retainer fee in a show of support for appraisers. “I'm donating the full $5,000 so that you can refund the amounts that others have contributed, unless it's needed. Personally and through my company (a la mode), I've always been a supporter of appraisal causes, and few are more clear-cut than this one. Good luck with the case,” says Biggers.

In addition to opposing the Bar Order, Breck Milde will also be filing a class action lawsuit on behalf of appraisers and agents, with the lawyer fee contingent on the amount collected. For those interested in joining the class action lawsuit, Conteduca says the following are required:  

• Proof you worked for ESA. It can be a written contract or an email trail of orders from the AMC.
• The amount owed to you. You need to furnish order numbers and amounts owed. Email receipts are acceptable. So are screen shots from Evaluation Solutions’ website.

Stories from the Field
William Furney, whose appraiser firm is owed over $70,000 by ESA, says he believes that appraisers and agents have a strong case against Chase. “Chase is listed as the client on all of my appraisals,” says Furney. Furney has been in contact with appraisers and agents who have been affected. “There are a lot of agents who are owed money for BPOs. Many are afraid to go after Chase because they still work for them.  I can see their point because Chase is still a source of income. How do you sue your employer and still expect to work for them? I speak with a handful of appraisers and agents every week who have similar circumstances,” says Furney.

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Furney has also filed complaints with the OCC and the CFPB but so far has received no response from regulators. “They acknowledge receipt but do not respond. Chase responded, saying that they’re looking into the situation. Chase sent me the same letter maybe six or seven times, telling me to contact Brian Reese,” says Furney.

“I think that we’re just stuck, and until something changes with the regulations for AMCs, there is nothing to protect appraisers from this happening again (see the story, AMC Recovery Fund for Appraisers)  People are saying don’t take work from Chase. But what if I have to feed my family from AMC work?  After the crash, every mortgage company that I worked for went under. I had to adjust and I did.  And I picked up AMCs, lots of them, and that’s how I make my living,” says Furney.

Diana Nytko is another appraiser who is negatively affected by ESA’s bankruptcy and who says she also filed complaints with the OCC.  “The OCC hasn’t done anything.  In November, I filed a complaint here in Connecticut with the State Banking Commission and never got a response.  I sent them all the information about what was going on. It’s ridiculous,” says Nytko. 

There is little question in Nytko’s mind about who is responsible. “WAMU Chase is responsible. They are the ones who received all my reports. They are the ones who benefited from my work, they are the ultimate benefactor. Through the law of agency, they are responsible for paying me,” says Nytko.

Nytko plans to take Chase to small claims court and to file property liens on the properties she appraised. “I’m going to attach the properties and I’m going to file in the local small claims courts.  I plan to file next week, I just need to make sure that Chase took over some of these properties.  There are a couple that I did right in my own town. One that Chase foreclosed on, so they won’t be able to resell it until they pay me,” says Nytko.

Nykto says this isn’t the first time her clients have failed to pay her, nor is it the first time she’s had to file property liens. “It’s legal in my state for an appraiser to file a lien. I’ve taken people to small claims before and filed an attachment against their property and won.  I don’t know how Chase can win, they were supposed to pay me and they didn’t,” says Nytko. (Learn more about property liens in One Appraiser's Solution to Getting Paid, Visit WorkingRE.com)

In contrast to other appraisers and agents who are worried about a backlash from Chase for speaking out or fighting back, Nytko says she now refuses to complete appraisals where Chase is the client. “I have closed all my bank accounts with Chase and I think others should do the same.  I honestly don’t understand how some appraisers would still want to work for Chase after this but maybe they are that desperate. If Chase wants to pay me up front to do appraisal work, I’ll do it, but I won’t let this happen again,” says Nytko.

If you’re interested in joining the class action lawsuit, Nick Conteduca can be contacted at Contact@EsAppraisalScam.com.

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