The valuation industry doesn’t often get helpful legislation.
Today we do.
On May 2, 2023, the Florida Legislature passed HB 213/SB 398, which amends Florida Statutes to establish new time limitations for legal actions against real estate appraisers and appraisal management companies (AMCs). The bill provides an effective date of July 1, 2023 and Governor Ron DeSantis is expected to sign.
Under the new law, an action to recover damages from an appraiser or AMC based on contract, tort, or other legal theory for an act or omission, other than fraud, in the performance of appraisal services or appraisal management services must be brought:
• Within 2 years after the date that the alleged act or omission is discovered, or should have been discovered with the exercise of due diligence.
• No more than 4 years after the date the appraisal services or appraisal management services were performed, or should have been performed.
Accordingly, the bill sets a maximum time – or statute of repose – of 4 years from the date of services in which most legal claim may be brought against appraiser and AMCs. This represents an improvement in the law for both appraisers and AMCs.
The bill was passed in response to a number of concerns raised by appraisers and AMCs, including the fact that existing law sometimes resulted in legal claims being pursued over appraisals that were 10 or more years old – long after damages could fairly be described as having been caused by a deficient appraisal. The new law is intended to enable appraisers to defend themselves against frivolous lawsuits.
The bill has been met with mixed reactions from the legal community. Some lawyers believe that the new law is too favorable to appraisers and AMCs and will make it more difficult for plaintiffs to recover damages for their losses. Others believe that the new law is fair and will strike a balance between the interests of appraisers and AMCs and the interests of plaintiffs.
With the passage of this bill, Florida joins a growing list of other states that have recently enacted similar improvements on statutes of limitation for the benefit of appraisers, including AZ, LA, MN, MS, OR, PA, TN, TX and WI.
Appraisers breathe easier thanks to new law.
That’s a win for appraisers.