ARIZONA HOUSE OF REPRESENTATIVES Fifty-sixth Legislature First Regular Session

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HB 2230: appraiser; claims; time limitation

Sponsor: Representative Harris, LD 13

Committee on Regulatory Affairs

Overview

Limits the time in which an individual may bring action against a real estate appraiser.

History

An individual who has a cause of action for damages against a home inspector must commence the action within four years following the event that causes the action (A.R.S. § 12-530).

The Appraisal Standards Boards of the Appraisal Foundation sets the uniform standards of practice for real estate appraisers through the Uniform Standards of Professional Appraisal Practice (USPAP). Current Statute has codified these standards into law (A.R.S. § 32-3610).

According to the Appraisal Institute, the discovery rule, a court made rule, allows a near infinite statute of limitations due to the time of filing a suit being unable to commence until the filing party discovers, or should have discovered, alleged defects in the appraisal. The USPAP requires that a work file for each appraisal be maintained for a period of five years after the appraisal was conducted or at least two years following a final disposition of any judicial proceeding involving testimony provided by the appraiser relating to the appraisal (Statutes of Repose – The Appraisal Institute).

Provisions

1. Allows an individual to take action against a real estate appraiser for damages either prior to the statute of limitations if it does not exceed four years or within a four-year period following the report date. (Sec. 1)

2. Lists the cause of action for damages against real estate appraisers as malpractice, negligence, an error, a mistake, an omission or breach in connection with a real estate appraisal or appraisal-related service. (Sec. 1)

3. Specifies that the statute of limitations does not apply to a claim in which a real estate appraiser intentionally commits fraud or makes a gross misrepresentation when performing an appraisal or appraisal-related service. (Sec. 1)

4. Defines report date as the date in which the appraisal service was completed or should have been completed and defines real estate appraiser as a:

a) state-licensed appraiser;

b) state-certified residential appraiser;

c) state-certified general appraiser;

d) state-registered trainee appraiser; and

e) any agent, employee, employer or firm of a person listed prior. (Sec. 1)

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i)                         HB 2230

j) Initials DC/TM Page 0 Regulatory Affairs

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