Book 1 - Appraisal Institute of Canada

in the phone book – can you
phone them at that number If
you do not know the client, it may
be more prudent to insist upon
verifiable payment. Avoid postal
money orders or cash in payment
of your account.
2. Meet the client, if possible. Do
not let third parties retain you on
behalf of the client without some
contact, preferably personal.
3. If there is no commitment to
paying your account or payment is
to be made indirectly, be wary.
4. When you do the appraisal, be
wary if there is no recent sales
history. Ask questions about the
existence of an agreement of
purchase and sale or existing
mortgages.
5. Avoid clients unknown to you who
want the utmost haste without
some good reason. Speed does
not lead to good work and it indicates
some other reason for the
appraisal.
6. Continue to avoid any pressure
to accept the client’s representations
absent confirmation in writing.
If there is a value to be met,
it must be your idea of that value
in the marketplace.
7. Are there difficulties in arranging
inspections Are you being asked
to attend at houses that are listed
for sale Are real estate agents
giving you access to the house
Are you being asked to convert
your appraisal to a ‘drive-by’ after
numerous attempts to inspect
directly.
8. Is the client asking you to deliver
the appraisal directly to third
parties, or will they ‘drop-by’ to
pick up the appraisal Either may
present some problems.
9. Are you being retained by a mortgage
broker with whom you have
never dealt Can you find them in
the telephone directory Do they
have an office
Recently, an Ontario judge determined
that a bank could not rely
on a falsely registered mortgage on
account of it not using an appraiser
to verify the owners/occupants of
the home on which the mortgage
was placed. Ultimately, banks may
start requesting appraisers to do
such verifications. Such verifications
are not within the scope of appraisal
work, and are much more the province
of other professionals, such as
lawyers.
The aforementioned points
will merely keep you from being
embroiled in litigation. Arguably, if
you do come to some actual knowledge
that an appraisal is being used
for an untoward purpose, you are
bound to remove yourself from that
transaction or it may be alleged that
you are part of it. Depending on the
purpose, you may be required to
take additional steps to report.
Mark R. Frederick is a barrister
with Miller Thomson LLP, a
nationally-based Canadian
law firm. William Barnstead,
a claims representative with
Winnipeg-based Leonard
French and Co., assisted with
the authoring of this paper.
C a n a d i a n
Appraiser
E C
Volume 51 • book 1 • 2007 valuateur
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