Études de cas en pratique professionnelle | Appraisal Institute of Canada

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Études de cas en pratique professionnelle

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The Professional Practice Case Studies are provided:

  • To increase members’ understanding of the application of standards rules
  • To help members avoid claims under the professional liability insurance program
  • To help members avoid complaints under the Professional Practice process
  • To help members understand the Professional Practice process
  • To provide guidance as to best appraisal practices

It is the AICs goal to provide as much guidance as possible to its members and with this in mind, the following Professional Practice Case Studies are presented below: (Every effort has been made to protect the identification of individuals and particular files except in cases in which a Professional Practice deciding body has ordered publication; in which case, the member has been named.)

Case Summary 1

The Candidate member produced a one page appraisal report that conformed to no prescribed reporting standard having limited descriptive detail, no comparable sale information, no highest and best use analysis; and no discussion pertaining to zoning, land use controls and any future planning considerations. [posted April 6, 2009]

Case Summary 2

The member cosigned a one page appraisal report that conformed to no prescribed reporting standard having limited descriptive detail, no comparable sale information, no highest and best use analysis; and no discussion pertaining to zoning, land use controls and any future planning considerations. [posted April 6, 2009]

Case Summary 3

A complaint was received regarding the poor quality of an appraisal report that was to be used in a civil litigation. The member’s report and testimony at trial were not helpful and the complainant failed to obtain compensation. [posted April 6, 2009]

Case Summary 4

A Complaint was received regarding a CRA designated member who had completed two appraisal reports for commercial properties without having the reports reviewed and co-signed by an AACI designated member. [posted April 6, 2009]

Case Summary 5

The member produced two appraisal reports on a subject property within two months of each other. The first report did not include an inspection of the interior and this was noted in the report. The second report did include an inspection of the interior of the subject property and the valuation was higher than the first. The difference in valuations was a result of improvements made to the interior that the client had represented as not contributing to the value of the property and thus had not been examined for the first report. The complaint focused on the differing valuations. The member was also uncooperative with the Investigating Committee; having to be repeatedly requested to cooperate, threatened with suspension and finally being suspended for non-cooperation. [posted April 6, 2009]

Case Summary 6

The member, a CRA, had completed and signed an appraisal report on a property outside the scope of his designation. [posted April 6, 2009]

Case Summary 7

The crux of the complaint focuses on the omission of a discussion of highest and best use within the report. The work file for the appraisal report consisted of three pages. [posted April 6, 2009]

Case Summary 8

A complaint was received regarding Nancy Urbas a Candidate Member who had prior criminal convictions before applying for membership in the AIC. There was a concern regarding consumer protection that the Candidate Member might jeopardize the reputation of the profession and the AIC, and why the AIC would have admitted a member under these circumstances. [posted April 6, 2009]

Case Summary 9

The member completed an appraisal report on a rural property with special instructions by the client to ignore the commercial aspects of the property. The member fulfilled this request and sent the appraisal to a lender without explanation of the limiting conditions and extraordinary assumptions he had made. The complainant was concerned that the appraisal report could be construed to be misleading. [posted April 6, 2009]

Case Summary 10

A consumer contacted the Counsellor, Professional Practice to voice a concern about a member’s business practice. The Counsellor, Professional Practice attempted to address these concerns with a view to resolving them with the consumer. However before this could occur, after learning that the consumer had spoken with the Counsellor, Professional Practice, the member instituted retaliatory action against the consumer. [posted April 9, 2009]

Case Summary 11

The original complaint questioned whether the Candidate member had the proper training to undertake the valuation of a high-end single family dwelling and if the co-signer was providing adequate supervision and training. [posted April 9, 2009]

Case Summary 12

In the originating complaint, the Complainant questioned the accuracy of some comparable information included in a valuation report of an income producing property. The main concerns with the report were that the member failed to utilize historical subject revenue and expense information available from owner; the income approach was unreasonably excluded and the nature and substance of adjustments in the Direct Comparison Approach were questionable. In addition a retrospective value was given in the report with virtually no supporting market information. [posted April 9, 2009]

Case Summary 13

A candidate registered in the non-fee category in the insurance program, issued an appraisal report which was not co-signed by an accredited member of the AIC. The member became an inactive member of the Appraisal Institute of Canada in 2008 and was subsequently removed from the roster of members for non-payment of dues. The hearing proceeded by written submission without the participation of the inactive member in accordance with AIC Regulation 5.45.2. The Decision is to remain on his file to be considered should he apply for membership in the future. [posted September 11, 2009]

Case Summary 14

The Adjudicating Panel endorsed a Sanction Consent Agreement reached by the Office of the Advocate and the member, Ron Dinning, AACI, P. App of Alberta before a Hearing took place. In the case of the primary complaint, Mr. Dinning provided three appraisals on the subject property, two of which had the same effective date but two different estimates of value – one at $175,000 and the other $210,000. Both reports were poorly qualified drive bys and almost identical except for differing adjustments which resulted in the different values. The third report is effective on a later date, with an estimated value of $220,000.00. Two other inter-related complaint files were bundled with this complaint. Due to circumstances, all of these complaint files had been held in abeyance by the Professional Practice process since the complaint had been filed. Regulation revisions allowed Professional Practice to re-activate these files and resolve them in an amount of time that was satisfactory to both the AIC and the member. [posted September 11, 2009]

Case Summary 15

The Candidate member signed a report that was not co-signed by an appropriately designated member of the AIC. The report was signed by a non-member and the member relied on his designation in another organization to co-sign the report. [posted September 11, 2009]

Case Summary 16

The Candidate member co-signed the report of another candidate member. He used his designation in another organization to do something that is prohibited by CUSPAP and AIC regulation. In addition the member failed to maintain control of his digital signature. [posted September 11, 2009]

Case Summary 17

The Candidate member co-signed the report of another candidate member. He used his designation in another organization to do something that is prohibited by CUSPAP and AIC regulation. The Candidate member did not obtain the co-signature of an appropriately designated and registered co-signer. [posted September 11, 2009]

Case Summary 18

The Candidate member co-signed the report of another candidate member. He used his designation in another organization to do something that is prohibited by CUSPAP and AIC regulation. The Candidate member did not obtain the co-signature of an appropriately designated and registered co-signer. [posted September 11, 2009]

Case Summary 19

The member prepared an appraisal on the subject property 2 weeks after it had sold. It was appraised for $100,000 and had sold for $62,000, yet the appraisal made no mention of the sale. Further, the member acted as one of the agents involved in the sale without disclosing this in the appraisal. [posted March 9, 2010]

Case Summary 20

The complaint arose out of the complainant’s concern that the appraiser had not bring to attention seven remedial conditions outlined in a City notification of an Order Prohibiting Occupancy and an Order to Remedy Unsafe Conditions and that the appraiser did not reveal that the property had been renovated from a bungalow to a two-story. [posted March 9, 2010]

Case Summary 21

The member prepared an appraisal on the subject property less than 1 week after it had sold. It was appraised for $110,000 and had sold for $71,000, yet the appraisal made no mention of the sale. Further, the member acted as one of the agents involved in the sale and was also the listing agent in a former expired listing but did not disclose this in the appraisal. [posted March 9, 2010]

Case Summary 22

The quality of the reports was poor and they lacked thoroughness. Both reports were significantly short on detail. The member undertook improper analyses of both the Direct Comparison and the Income Approach. The reports lack important points of disclosure. [posted September 2, 2010]

Case Summary 23

The member produced a report for a lender to be used for lending decision purposes. The report failed to comply with CUSPAP. [posted September 2, 2010]

Case Summary 24

The report did not provide sufficient sales evidence to support the conclusions within the report and that the analysis ignored the terms and conditions of the leases in place. In addition, the report failed to identify a reasonable exposure time linked to the market value estimate. [posted September 2, 2010]

Case Summary 25

The zoning of the property was identified as being agricultural and no further details were provided. The highest and best use analysis in the report made mention of the future development for the property. The supporting argument for the conclusion that the highest and best use for the property was country residential was not adequate. [posted September 2, 2010]

Case Summary 26

The reports fail with respect to numerous Standards Rules and lack support for many of the conclusions, while the conduct of the member breaches numerous Ethical Rules. Repeated requests for copies of the reports and work files were made and the member was also asked questions on two occasions to assist the investigation with respect to those properties. Regarding two files the appraiser has produced no work product or research and the answers to questions put to Jean Clive by the Investigator were unsatisfactory. Of particular significance is Jean Clive’s failure to provide copies of her work files. Also concerning two of the files Jean Clive noted in her response that she did not maintain work files after 30-40 days. [posted September 2, 2010]

Case Summary 27

The report indicated that the existing use of the property was residential which was not correct. The report did contain limited observations that indicated that the report was hypothetical in nature; however, no reference was made to extraordinary limiting conditions. The report does not use the terminology “hypothetical” market value estimate and does not clearly set out requisite extraordinary limiting conditions that would be necessary to estimate market value “as if” converted back for residential use. Because the Member has been suspended, a hearing was requisitioned in order that the Adjudicating Committee could determine a final decision regarding the file, which would then be placed on the Member’s record. Should the Member apply for re-instatement at a later date, he will first have to meet any conditions in the final decision before reinstatement. [posted September 2, 2010]

Case Summary 28

T. Stuart Hammell, a CRA, performed an appraisal that fell outside the scope of practice for a CRA designation and was not co-signed by an AACI. [posted September 2, 2010]

Case Summary 29

The member failed to indicate in the report that there would be no insurance protection under the AIC professional liability insurance program. [posted September 2, 2010]

Case Summary 30

The member prepared a report with values noted as “as if complete” and “as is” and proceeded to give a final opinion of value that is misleading since it is unclear what his final value represents. The member was unable to produce information readily when requested by the AIC during the course of the complaint investigation. [posted September 2, 2010]

Case Summary 31

The assignment fell outside the scope of practice of a CRA designation. A member cannot omit his designation on an appraisal report. [posted September 2, 2010]

Case Summary 32

The report submitted to the client falls far short of the CUSPAP Standards and fails to adhere to virtually any of the Appraisal Standard Rules. [posted September 2, 2010]

Case Summary 33

Mr. Swanson performed an appraisal report that fell outside the scope of the CRA designation. Mr. Swanson has a prior disciplinary record of working beyond the scope of the CRA designation and failing to obtain an appropriately designated co-signer. [posted April 29, 2013]

Case Summary 34

The member, a CRA, mis-identified the zoning in the report and used comparables in the Direct Comparison Approach that fall outside the scope of the CRA designation. The member did not perform a complete Income Approach. [posted May 4, 2012]

Case Summary 35

The form report did conform to CUSPAP. The overall adjusted value range provided for the property appeared unreasonable. [posted May 4, 2012]

Case Summary 36

The member performed a contingent assignment. The member performed an appraisal assignment that fell outside the scope of his designation. [posted May 4, 2012]

Civil Case Studies

The Appraisal Institute watches for civil cases pertinent to the appraisal industry and is pleased to provide these to its members. These cases represent hot topics and trends in the appraisal industry and provide insight into issues that are relevant to the appraiser in his everyday practice.

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