Arizona Enacts Statute of Repose; Florida Close to Doing So
Arizona became the 12th state to enact a statute of repose and Florida would become the 13th. The other states with appraiser liability protections in place are Kentucky, Louisiana, Minnesota, Mississippi, North Carolina, Oregon, Pennsylvania, South Dakota, Tennessee, Texas and Wisconsin. The Appraisal Institute is actively involved in helping to advance similar laws in other states.
In Arizona, the law establishes a four-year limitation on lawsuits against appraisers for legal claims such as negligent misrepresentation, professional malpractice and breach of the standard of care. That four-year period is calculated beginning from “the date on which the real estate appraisal giving rise to the action was completed or should have been completed.” In the case of an appraisal-related service, it is calculated beginning “four years after the date on which the appraisal-related service giving rise to the action was performed or should have been performed.” The limitations established by HB 2230 do not apply to claims alleging “that an appraiser knowingly and intentionally committed fraud or knowingly and intentionally made a gross misrepresentation” when performing a real estate appraisal or when providing an appraisal-related service.
The current legislative session in Arizona is scheduled to adjourn May 12, and HB 2230 will take effect 91 days later and apply only to appraisals completed after the effective date.
The signing of HB 2230 concludes a multiyear effort led by the Appraisal Institute’s Phoenix Chapter and managed by Dale Cooper, MAI, SRA, AI-GRS, AI-RRS. Additionally, AI’s Southern Arizona Chapter, the Coalition of Arizona Appraisers and the Real Estate Appraisers of Southern Arizona greatly contributed to the effort.
In Florida, the legislature completed action on its appraiser-specific statute of repose and will send HB 213 to Gov. DeSantis to sign. He will have 15 days from receipt to either sign or veto the bill; if he takes no action, it will take effect July 1 without his signature.
HB 213 would require any action to recover damages against an appraiser or appraisal management company be filed within two years of the date that the alleged act or omission giving rise to the suit is discovered or should have been discovered. Actions must be initiated within four years of the date the appraisal services or appraisal management services were performed or should have been performed. The provisions do not apply to any action alleging fraud. The new limitations will apply to appraisals and appraisal management services performed on or after July 1, 2023; any action that accrued before that date must be filed by July 1, 2024.
The effort to pass HB 213 was a multiyear action by the Region X Government Relations Committee led first by Wes Sanders, MAI, and most recently by Matt Terry, SRA. Region X was represented in Tallahassee by Sun City Strategies.