In a settlement conference at TALCB, it became apparent that the investigator did not have support for an allegation:
- When pressed, the investigator said that if further research showed that the allegation could not be supported, TALCB would remove it from the charges.
- In a world of reverse logic, this translates as: If we cannot support our accusations, we will remove them!
This case was resolved favorably for the trainee after it became evident to the client/attorney that many allegations were either inaccurate or unsupported. For this the trainee had to retain an attorney and me.
It gives me no pleasure to write this. I was an investigator at TALCB until 2012, and I can think of no more stimulating work I’ve ever done (including my time in the navy as a missile technician on a submarine).
The experience at TALCB made me a much better appraiser. Because every case went to court unless settled beforehand, I had to have proof of all facts and support for all opinions and conclusions with what our attorney consistently called “objectively verifiable data.”
To this day, I employ that phrase when mentoring Texas appraisers. It’s not enough for us to say that adjustments are “based on the appraiser’s experience.” That experience must be supported with factual data to be credible. In fact, if you look at the USPAP definition of credible, you’ll see the comment:
“Credible assignment results require support by relevant evidence and logic.”
Evidence is objectively verifiable data.
Somewhere along the line, TALCB stopped requiring investigators to support their opinions with facts. Each of the investigators is a certified appraiser. When examining an appraisal report that is part of a complaint, they are performing Appraisal Review as defined by USPAP.
The appraisal review is performed using a form called an Investigative Report (“IR”). It is a checklist which goes through USPAP. It asks if the at-issue report complies with the rules, standards, and standards rules. Each question is answered with a “Yes”, “No”, or “N/A” followed by commentary. Each IR must be produced in compliance with USPAP.
Completed IRs are sent to the staff attorney (the client) who uses this report to propose a settlement to the appraiser/respondent. This settlement offer lists the violations of USPAP, transcribed from the IR’s “No” answers, which the investigator produced using “objectively verifiable data” to support the opinions and conclusions it contains.
Each of these IRs ends with the USPAP certifications required of every appraiser/reviewer:
“the statements of fact contained in this report are true and correct.”
“the reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions and are my personal, impartial, and unbiased professional analyses, opinions, and conclusions.”
“my analyses, opinions, and conclusions were developed and this review report was prepared in conformity with the Uniform Standards of Professional Appraisal Practice.”
Consequently, the staff attorney/client has every reason to believe what’s stated in the IR is true, correct, appropriately developed, etc. And here is where the problem lies.
Some investigators consistently check No for non-compliance by a respondent of a USPAP requirement without support, as in the example above. Ironically, there is also at least one instance of an investigator/reviewer checking Yes while knowing that the at-issue report was NOT compliant in those specific categories!
DOUBLE STANDARD: a set of principles that applies differently and usually more rigorously to one group of people or circumstances than to another; [merriam-webster.com]
In short, allegations are being made against respondents that are unsubstantiated. In appraisal review, these might be appropriate assumptions and extraordinary assumptions but only if the investigators clearly, conspicuously, and accurately disclosed them as required by USPAP.
An investigator testified that the IR for an at-issue appraisal report was written and given to the attorney/client before receiving the response from the actual respondent:
- The investigator/reviewer relied on what was provided by a trainee for the substance of the allegations.
- The IR stated that the investigator had examined what the respondent provided to the board.
- Charges were drawn up based on that “evidence” without any consideration of what was said by the true respondent in his response letter, his answers to the Questionnaire, and the workfile he provided in his complaint package.
One wonders if the TALCB attorney/client would have proceeded with charges against the appraiser had he known the response to the complaint had yet to be received by the investigator.
TALCB’s Due Process is not Fair Process
A respondent, faced with a list of charges, which is written in legalese that describes allegations in the broadest terms, must either accept TALCB’s offer or spend a good deal of money on a consultant such as myself, an attorney, or both, to examine the case and refute the charges.
This is due process under the law, but not fair process under USPAP requirements for appraisal review. Were this so, appraisers would only be found in non-compliance of those parts of USPAP for which TALCB had proof or support. Appraisers wouldn’t have to pay to have unsupported charges removed, and sanctions reduced or dismissed.
Informal discussions with TALCB about these practices have been for naught. It was explained to me that charges brought for a hearing often contain allegations based on circumstantial evidence. This is the crux of the problem. Although attorneys may allege violation based on assumptions, an appraiser acting as a reviewer cannot unless they are disclosed to the intended users of the review. This is not being done.
More examples to come in future posts.
 In fact, it shows up twice in USPAP. Page 4, Line 112 in Definitions; and Page 12, Line 353 in Scope of Work Rule [USPAP 2018-2019 Edition]
 See SRs 3-2(e), 4-1(c), and 4-2(f) in USPAP 2018-2019 Edition.