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Dispute Resolution Section - State Bar of Georgia - Spring 2012 Newsletter


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Dispute Resolution Section - State Bar of Georgia - Spring 2012 Newsletter, The Role of the "Appraiser" as Arbitrator, Special Master, or Other Neutral, Judicial Adjunct, or Trier of Fact

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Dispute Resolution Section - State Bar of Georgia - Spring 2012 Newsletter

  1. 1. DR Currents A Publication of the Dispute Resolution Section of the State Bar of Georgia Spring 2012From the Chairby Hal GrayA t the outset, please accept my thanks for your those additions were well-received by our membership. I permitting me to serve as the chair of the Dispute sincerely hope that we can continue to make the Section of Resolution Section for 2012. I hope to be able more tangible, practical value to its continue the excellent stewardship of past chairs John We also welcome input from the various ADRSherrill and Ray Chadwick, and certainly have my work cut providers in the state. The American Arbitrationout for me in that regard. Association, JAMS and the various mediation services Over the past few years, this section has begun reaching scattered throughout Georgia provide support to ourout to its members in several new ways. We’ve added a section members in many ways, and we invite their staff to bring towebpage ( and we’ve added an our attention their thoughts as to how we may better serveannual CLE Dispute Resolution Seminar in Augusta. With our members, both neutrals and advocates.the addition of the latter, when combined with the annual My deepest thanks to Adam Sutton who kindlyArbitration Seminar in August and the ADR Institute and permitted me to draft him into the position of editor ofNeutrals’ Retreat in December, we now co-sponsor (with this newsletter.ICLE) three separate Dispute Resolution CLE programs. I look forward to serving this year as your Section We hope to continue the tradition of reaching out to our Chair. It is an honor to do so.members by adding a CLE Seminar, possibly in Macon,this year. As “alternative” dispute resolution becomes more My thanks and best regards.widely accepted across the state, it doesn’t make much Hal Gray is the Managing Partner of Ragsdale, Beals, Seigler,sense to me for our Section members to be required to Patterson & Gray, LLP. A graduate of the Emory University Schoolcome to Atlanta to learn more about it. of Law, he has practiced construction law and commercial and real estate litigation in Atlanta for over thirty years. He has been a The Executive Committee and I are very interested in member of the AAA Mediation and its various Arbitration Panelsyour thoughts and suggestions for new seminar topics and for 25 years and regularly works as a mediator and arbitrator inspeakers. (The members of the Executive Committee and construction and commercial disputes. Hal currently serves as thetheir email addresses are included in this newsletter.) Few Chair of the State Bar Dispute Resolution Section and the Boardsthings are more boring than CLE seminars that feature the of Directors of the Construction Law and Dispute Resolutionsame topics and the same speakers time-after-time. Last Sections of the Atlanta Bar. He is a Fellow of the College ofyear we were able to add several new matters to both the Commercial Arbitrators and a member of the Georgia Arbitrators’August and December programs, and it appeared as though Forum and the Georgia Academy of Mediators and Arbitrators. Upcoming Events “Practice Builder 2.0” at the State Bar of Georgia on April 10 The Inaugural Conference of the Atlanta International Arbitration Society, April 15-17
  2. 2. Federal Pro Dispute ResolutionBono Residential ExecutiveMortgage CommitteeMediation ProgramBy Halsey G. Knapp Jr. Herbert H. Gray III, chair Taylor Tapley Daly, vice chairI n conjunction with the Federal Bar Association, Judge William Duffey has developed a pro bono mediation program to help address the recent Joan Grafstein, secretary/flood of cases in the United States District Court forthe Northern District of Georgia involving residential treasurermortgage foreclosures. By requiring borrowers toprovide updated financial disclosures and requiringlenders to prequalify refinancing under existing At-Largegovernment programs, the mediation program is ideallysituated to facilitate a rapid and expedited resolution of Phil Armstrongthese cases and to provide a meaningful opportunity forrefinancing, where appropriate. Bobby Glenn Halsey G. Knapp, Jr. of Foltz Martin, LLC isorganizing a group of pro bono volunteer mediators John Hincheywho will provide this service to the federal courtsystem. While the first five hours of the mediation are Larry Christensenfree of charge, the mediator is entitled to assess feesfor his or her time spent as mediator thereafter. For John Sherrill, immediate pastmore information on this public service opportunityplease contact Halsey Knapp at Foltz Martin, LLC at or (404)231-9397. Thank you. Ray ChadwickHalsey G. Knapp, Jr. specializes in Atlanta BusinessLitigation and tries civil cases in state and federal courts inGeorgia and other states. His multifaceted practice includes Adam Sutton, DR Currentsrepresenting clients in complex commercial litigation,business tort, trade secret, restrictive covenant, technology Editorlitigation, and employment law. Contents From the Chair............................................................................................................................................. 1 Upcoming Events........................................................................................................................................ 1 Mediators Design Your Future!.................................................................................................................... 3 Will Atlanta be the Next International Arbitration Venue?............................................................................ 4 Pre-Divorce Mediation................................................................................................................................. 7 To a Man Who Has a Hammer, Everything Looks Like a Nail.................................................................... 8 2 DR Currents
  3. 3. Mediators Design Your Future!By Bob Berlin & Carolyn L. RainesA re you one of those who left mediation training trying to be all things to all people. As marketing experts truly wanting to be a mediator? Were you all fired opine, marketing to everyone is marketing to no one. Why up about being able to help people in conflict? not become the specialist, the expert, that go-to-person,Remember how strong and confident you felt about going everyone in your target market will seek out?out to make peace in the world? Conflict is everywhere. It’s the largest growth industry Did you go visit all your lawyer friends to talk to them on the face of the planet. These are some simple steps thatabout the value of mediation? Did you get a nice pat on the can get you started.back and a ‘good for you’ just before heading for the exit? 1. What are you passionate about?Did you run straight to the courthouse? And, did you find along line of mediators, much like yourself, trying to get in? 2. List all of your skills, i.e. coach, conflict resolver,Maybe it’s time to re-think your strategy. negotiator. 3. Blend #1 and #2 above to bring your target market So, how do you go about doing that? You’ll have to ask into focus.yourself some very personal questions and then think longand honestly about the answers. So, grab a pen and paper 4. Ready. Aim. Fire!and start jotting everything down. Bravo! Now you have just defined the first chapter in First of all, understand that only 30 percent of all the new design of your life for the immediate future.conflict resides in the courthouse or a lawyer’s office. The The authors of this article will be presenting theirrate of filings of actions at the courthouse is not enough to program “Practice Builder 2.0” at the State Bar ofwarrant enough work for the newly trained mediators, let Georgia on Tuesday, April 10, 2012. If you’re interestedalone those who are already in line. in attending, please contact them by email: carolyn@ So what do you do? Where do you go? The vista of or call (478) 477-3317.possibilities is greater than you think. Open up to a broad As President of The New Decision Management Associates, Inc.range of thinking in order to narrow your focus and thus Robert A. “Bob” Berlin has primary responsibility for Mediation,expand your market. Finding a special niche that you are Negotiation and Arbitration services as well as lead trainer. Hepassionate about serving will take some soul searching. Be has handled in excess of 4200 civil and family law mediationscareful. If you pick a niche you don’t love, chances are you since 1968. He is a graduate of the Walter F. George School of Law, Mercer University, receiving the LLB (J.D.) in 1963. Hewon’t see much success. If you’re going to work hard, the was a senior partner in the law firm of Berlin and Hodges, P.C.rewards will be greater if you feel passionate about it. for 39 years and served as a Municipal Court Judge for 25 years. Someone told me many years ago that hard work only Berlin served in the Georgia House of Representatives. His ismakes you tired. Hard work with a plan or a goal, however, an approved Mediator for the USPS, EEOC and FBI. He serveswill get you there. So, consider marshalling all of the skills on the Advisory Committee of the Training & Credentialing Committee of the Georgia Commission on Dispute acquired in your lifetime. Think broader than the list ofcredentials you’ve got. What are those skills that makes you As CEO of The New Decision Management Associates, Inc.‘you’? Drill down and find all of those skills you possess. Carolyn L. Raines is responsible for the operations, managementWrite them down. You’ll be amazed at how quickly your and co-trainer. A graduate of Middle Georgia College shepage fills up. You are a: Coach, Advisor, Facilitator, is a registered Mediator with the Georgia Office of DisputeNegotiator, Listener, Designer, Economist… Wow! Did you Resolution and has mediated large group conflicts on a nationalrealize you were all those things and more? level. She comes to The New DMA from the non-profit sector with expertise in corporate management, institutional Now, think about who your target market is? Define performance assessment, fund development and behaviorthem – how old are they, where do they live, what do they analysis. She currently serves on the Citizen’s Panel Reviewdo for a living, where do they hang out, what are their Board for the Bibb County Juvenile Court. hobbies? What types of conflict might they be engaged in?You may have to devote quite a bit of time in research toidentify your ideal target market. You may want to consider thinking of it in terms ofthe ‘Generalist vs. Specialist’. The generalist is one who isSpring 2012 3
  4. 4. Will Atlanta be the Next InternationalArbitration Venue?By Glenn P. HendrixA broad-based coalition comprised of the State Bar of continue to emerge. For instance, Singapore, Dubai and Georgia (at the initiative of the Dispute Resolution Miami have become leading international arbitration fora in Section), several dozen Georgia law firms, the the past decade, and the island nation of Mauritius is vying tomajor U.S.-based arbitration institutions, southeastern become a center for Africa-related schools, in-house counsel, and the Georgia and Metro Why Georgia?Atlanta Chambers of Commerce seeks to promote Atlantaas a seat of international commercial arbitration. What can Georgia offer compared to these other venues? Surveys of corporate counsel indicate that the most International arbitration is not an exotic pastime. It important factor in picking an arbitral venue is the legalis the leading method for resolving cross-border business infrastructure, including the jurisdiction’s arbitration lawdisputes, in part because companies naturally fear litigating and track record in upholding agreements to arbitrate andin a foreign court. Arbitration allows the parties to resolve arbitral awards.their dispute in a neutral forum. An international treatyalso makes it easier to enforce an arbitration award across Georgia showcases well in that regard. The 11th Circuitborders than a court judgment. While the United States has U.S. Court of Appeals is the most international arbitration-no treaties with any other country for the enforcement of friendly court in the U.S. and among the most arbitration-our court judgments, over 140 countries, including the U.S., friendly courts in the world. For instance, the 11th Circuitare parties to the U.N. Convention on the Recognition and is one of only few Circuits that preclude challenges toEnforcement of Foreign Arbitral Awards. arbitration awards on the basis of “manifest disregard for the law.” This eliminates a concern expressed by some non- Most international arbitrations take place in just a handful U.S. lawyers about conducting international arbitrations inof cities. London, New York, Geneva, Paris, Hong Kong and the U.S.s. The 11th Circuit has also taken the national leadStockholm are among the traditional leaders, but new centers 4 DR Currents
  5. 5. in upholding sanctions against parties making frivolous transactions and disputes. The city also has a cosmopolitanchallenges to arbitration agreements and awards. global brand, thanks in part to the ’96 Olympics, the Carter Center, CNN and the Martin Luther King and Andrew Subject to some very minor restrictions, Georgia allows Young legacies. 76 countries are represented in Atlanta by aparties to select counsel of their choice in international consulate, trade office or bi-national chamber of commerce.arbitration proceedings, including attorneys not licensed in Atlanta is also less expensive than other major arbitral venues.any U.S. jurisdiction. This is critical to parties selecting anarbitral venue. If the parties’ dispute is governed by, say, Finally, a common element in the rise of all successfulGerman law, they will want German lawyers involved in arbitral venues is an active collective effort by the localthe case. legal community to brand and market the city as an international arbitral seat. This plays to one of Georgia’s Georgia also has an international arbitration-friendly strengths, as we have a strong tradition of marshalingstate statute. The law was first enacted in 1988 and business, civic and political coalitions in effectively sellingsubstantially amended in the 2012 legislative session by ourselves to the rest of the world. This is reflected in theSB 383, which was drafted by a team led by Prof. Doug board of directors of the recently established AtlantaYarn. SB 383 de-links the international and domestic International Arbitration Society (AtlAS), which includeschapters of the Georgia Arbitration Code and largely the following individuals:tracks a model law prepared by the United NationsCommission on International Trade Law (UNCITRAL). Philip “Whit” Engle, Ecova, Inc. (Executive Vice-The State Bar’s Dispute Resolution Section Chair, Hal President); Brian White, King & Spalding (ViceGray, provided effective testimony on behalf of the bill in President); Steve Clay, Kilpatrick Townsend &the General Assembly. Stockton (Vice President); Valerie Sanders, Sutherland Asbill & Brennan (Treasurer), Joan Grafstein, JAMS Moreover, Atlanta is one of the easiest cities in the (Secretary), Tom Asselin, Smith Gambrell & Russell;world to access. In Hartsfield-Jackson, we have the busiest Dorothy Beasley, Henning Mediation & Arbitration;passenger airport in the world. No other city in the world Linda Beyea, American Arbitration Association;can make that claim. The airport serves non-stop flights Alan Blackburn, Balch & Bingham;William 151 U.S. destinations and more than 90 international Brogdon; Charles “Chip” Brower, University ofdestinations in 55 countries. Mississippi; Jorge Fernandez, Metro Atlanta Chamber Atlanta is also a major corporate headquarters city of Commerce; John Fleming, Sutherland Asbill &and a primary legal market served by a sophisticated legal Brennan; Shelby Grubbs, Miller & Martin; Huntercommunity accustomed to handling the most complex Hughes, Rogers & Hardin; Matt Richardson, Alston & Bird; Peter “Bo” Rutledge, UGA; Christof Siefarth, GÖRG; Richard Sheinis, Hall Booth Smith & Slover; John Sherrill, Seyfarth Shaw; Tony Smith, Weinberg, Wheeler, Hudgins, Gunn & Dial; Chris Soffe, Gleeds; John Watkins, Barnes & Thornburg; Kirk Watkins, Womble Carlyle Sandridge & Rice; Doug Yarn, GSU; and Frank Young, Haskell Slaughter. What is the Plan to Realize Georgia’s Full Potential as an Arbitral Center? Several steps are being taken to ensure the success of this initiative: Clarifying the Bar Rule with regard to foreign lawyers handling international arbitrations in Georgia. This involves some tweaks to the commentary to Georgia Bar 5.5(e)(3). The State Bar’s Board of Governors has already approved the revisions, which now await the approval of the Georgia Supreme Court. Ben Greer of Alston & Bird (ret.), Bill Smith of the State Bar, and Bryan Cavan of Miller & Martin have been key players in moving this forward. Getting the word out. AtlAS has developed a website ( and brochures in a number ofSpring 2012 5
  6. 6. languages extolling the city’s virtues as an arbitral venue, ALI’s Restatement project on the U.S. Law of Internationalas well as an extensive mailing list, and is developing Commercial Arbitration; and leading practitioners, neutralsan outreach program to in-house counsel around the and in-house counsel from Georgia and well beyond. Asworld. AtlAS seeks to promote an Atlanta arbitral seat this article goes to print, eighteen countries are representedto companies throughout the Southeast. A company among the registrants.headquartered in, say, Memphis, Charlotte or Nashville The event offers an opportunity to learn more aboutmight be able to persuade the party on the other side of the the initiative and recent developments in internationaldeal that Atlanta is a sufficiently “neutral” site to resolve arbitration and to network with local and internationalfuture disputes. leaders in the field. You can register online through the Presenting an annual signature conference on AtlAS website -- arbitration. Hosting conferences to attractthe international arbitration community to their cities What’s in this for Georgia Lawyers?has been a key factor in the recent emergence of Miami Increasing the number of international arbitrationand Singapore as major arbitral centers. Likewise, AtlAS proceedings with a Georgia venue would expand the workhas organized a world-class international arbitration available for Georgia lawyers, even if non-Georgia lawyersconference to take place on April 15-17, 2012 in the Loews also benefit. For instance, over 80% of all arbitrationsAtlanta Hotel, with a reception and dinner at the High administered by the LCIA have no connection to England.Museum. The title is “The Role of the United States in That creates a lot of work for English lawyers. In a recentthe International Arbitration System of the 21st Century: speech to Parliament, the Chancellor of the ExchequerTrendsetter, Outlier or One in a Crowd?” Brian White and described international arbitration as one of the “unsungValerie Sanders are the conference co-chairs. success stories” of the U.K. economy. An all-star cast of speakers from five continents Conclusionwill include Chief Justice Carol Hunstein of the Georgia AtlAS is aiming for a much larger share of theSupreme Court, Mayor Kasim Reed, the presidents of burgeoning field of international arbitration for Georgiathe AAA, Chartered Institute of Arbitrators and London lawyers. Its monthly meetings rotate between law firmsCourt of International Arbitration (LCIA); the secretaries- and local arbitral institutions. The schedule appears on thegeneral of the China International Economic and Trade AtlAS website. Anyone is welcome to attend, regardless ofArbitration Commission (CIETAC) and International membership in the AtlAS organization. We hope to see you atCentre for Settlement of Investment Disputes (ICSID); the an upcoming meeting and at the conference on April 15-17!chairs of the International Chamber of Commerce (ICC)Court of International Arbitration and the international Glenn P. Hendrix is the managing partner of Arnall Goldenarbitration committees of the International Bar Association Gregory LLP and the president of the Atlanta Internationaland American Bar Association; all four reporters for the Arbitration Society. He can be reached at The State Bar has three offices to serve you. HEADQUARTERS SOUTH GEORGIA COASTAL GEORGIA OFFICE 104 Marietta St. NW OFFICE 18 E. Bay St. Suite 100 244 E. 2nd St. Savannah, GA 31401-1225 Atlanta, GA 30303 Tifton, GA 31794 912-239-9910 404-527-8700 229-387-0446 877-239-9910, 800-334-6865 800-330-0446 Fax 912-239-9970 Fax 404-527-8717 Fax 229-382-7435 6 DR Currents
  7. 7. Pre-Divorce MediationBy Adam M SuttonW hile discussing the trials and tribulations of Pre-Divorce Mediation is an attempt to eliminate the managing a small law office, an experienced time, energy, and money spent litigating when the parties litigator and long-time member of the State Bar need to be mediating. In Pre-Divorce Mediation, theonce said that even in a down economy people still commit spouses meet with a mediator before anything is filed withcrimes and people still get divorced. The implication was the court. Some people may prefer to have attorneys withthat criminal defense attorneys and family law attorneys them at the mediation but others may not. The Pre-Divorcesurvive a struggling economy better than most. That Mediation session is similar to typical mediation sessions.statement generally rings true. However, while the number The mediator works to help the parties resolve theirof divorcing spouses may be as high as ever, the manner disputes by facilitating communication, clarifying interest,which clients approach divorce is changing. Spouses who and generally assisting in negotiation. If the spouses reach aare unemployed, behind on their mortgage, and struggling settlement, the mediator drafts an agreement which is thenwith day-to-day expenses are not willing or able to give an signed by both parties. They can then take this agreement toattorney a lump sum retainer in the thousands of dollars. an attorney who will draft their legal paperwork and file theThey also resist committing to an divorce’s per hour rate when they There are some things to keephave no idea how much the fees in mind if you are consideringwill be by the end of their case. recommending Pre-DivorceSpouses are shopping for low costs Mediation. Because mediationand fast results more than ever. occurs before discovery, it may not Naturally, these people be appropriate for spouses whogravitate towards the idea of have very complicated financialan uncontested divorce. In an issues or where there is a concernuncontested divorce, a spouse that one spouse is not willing tohires an attorney to draft and file fully disclose his or her assets.all necessary paperwork and to Even when financial issues arefacilitate the divorce process. relatively simple, it is importantIn most cases only one attorney is involve but the non- that each have access to necessary financial documents andrepresented side may retain counsel to review the proposed be knowledgeable enough to effectively negotiate. Finally,settlement agreement if he or she so wishes. Most attorneys while a trained and experienced mediator can provide a lot ofwho accept uncontested divorces only charge a single low negotiating assistance even when people adamantly disagree,flat fee. To utilize the uncontested divorce process the it is important that both parties are willing to at least attemptparties must agree on all issues from the very beginning. to negotiate in good faith.If the parties disagree, no matter how big or small the For many people, utilizing mediation at the beginningdisagreement may be, they are out of luck. They are left of the divorce process gives them the ability to turnwith the traditional combative approach to divorce where what could have been a long and expensive process intothey each must retain their own attorney, pay thousands of a comparatively short and cost efficient experience.dollars in fees, and fight in court. It bridges the gap between people who cannot afford Pre-Divorce Mediation may be a viable alternative lengthy litigation and the benefits and cost savings of anfor these people. Mediation is certainly not a new concept uncontested the realm of divorce. Most divorcing parties attend Adam M Sutton is the founder and president of The Sutton Lawmediation. Many judges even require mediation. However, Office LLC in Kennesaw, Georgia and the new Editor of DRmost divorcing parties do not attempt mediation until Currents. A graduate of Atlanta’s John Marshall Law School,after they begin the traditional divorce process. Typically he is a family law attorney, criminal defense attorney, guardianeach spouse retains attorneys who file answers and ad litem, and mediator who practices throughout Metro-Atlanta.motion, request and fight over discovery, and argue over He is a volunteer attorney for Cobb County Legal Aid, worksthe contentious issues. While some jurisdictions mandate with inner-city youths with the Atlanta Teen Court program, andmediation early in the process, most courts do not mandate assists in the training of new mediators. He can be reached atmediation until after the first temporary hearing. adam@thesuttonlawoffice.comSpring 2012 7
  8. 8. To a Man Who Has a Hammer, EverythingLooks Like a NailThe Role(s) of the “Appraiser” in Dispute Resolution and Alternative Dispute Resolution asFinder of Fact, Neutral, or Judicial AdjunctBy Jon M. RipansT his article was prompted by a debate over the role of value of the real property”; appraisers serving as property tax County Hearing • USPAP defines “appraisal” simply as “an opinion Officers under a new Georgia statute. As appraisers of value;”2 andare wont to do, there were strong opinions regarding twoissues: • Georgia law defines “appraisal” as “an analysis, opinion, or conclusion prepared by an appraiser 1. whether the role of County Hearing Officers relating to the nature, quality, value, or utility of presiding over property tax appeals under Official specified interests in, or aspects of, identified real Code of Georgia Annotated [“O.C.G.A”] Section estate”3and further provides that “[a]n appraisal 48-5-311(e.1) is that of an appraiser, appraisal may be classified by subject matter into either a practice or some other form of valuation service as valuation or an analysis.”4 opposed to something completely different; and It cannot be ruled out that some of these appraiser 2. whether the Uniform Standards of Professional colleagues may also believe that the Georgia property tax Appraisal Practice [“USPAP”] apply. arbitration statute5 is also calling for an appraisal, despite This article is but one person’s opinion on a rather the fact that its default provision is for the arbitrator tocontentious matter. It’s a tough topic on which many people choose between a value submitted by the taxpayer and oneseem to disagree –passionately. Take it with a grain of submitted by the taxing authority based upon the evidencesalt. And use it at your own risk, whether you are an presented.appraiser, advocate or party. The question becomes: what is the role of the holder Here are the specifics of the Georgia situation, but the of an appraisal classification as neutral when a statute callsgeneral scenario is analogous to manyother fact-finding or neutral roles that maycall upon a person holding an appraisalclassification. The Georgia property taxCounty Hearing Officer statute1callsfor the Hearing Officer to be a CertifiedGeneral Real Property Appraiser orCertified Residential Real PropertyAppraiser. To many of my appraiser colleagues,those requirements make it sound likean appraisal is the function of CertifiedGeneral Real Property Appraiser orCertified Residential Real PropertyAppraiser serving as a property a CountyHearing Officer because: • the statute requires that the County Hearing Officer hold certain appraisal classifications under Georgia law; • the County Hearing Officer’s role is to “determine the fair market 8 DR Currents
  9. 9. for that trier of fact to hold an appraisalclassification? There is surprisinglylittle published on the topic of appraisalclassification holders serving as triers offact, but I conclude that the role is almostalways something other than that of“appraiser.” One particular Georgia Court ofAppeals decision tends to support thisconclusion. See Skinner v. Smith, 120Ga. App. 35, 169 S.E.2d 365, 367 (1969)(explaining that the fact that a contractreferred to a third-party decision makeras an appraiser and not arbitrator wasimmaterial where that third party wasselected to make determination of factto bring an end to litigation).See also,Stephens v. Trust for Public Land, 475F.Supp.2d 1299, 1316-17 (N.D. Ga, 2007). The crux of the problem is that realestate appraisers and other valuationprofessionals and the rules that govern theirprofession, such as USPAP, function along by law or regulation,” 2) “by agreement with the clientthe lines of the Civil Law inquisitorial system of justice, in or intended users,” or 3) when the appraiser or otherwhich judges take on the responsibility of investigating the professional chooses to comply (which could be triggeredfacts of a matter. But, our legal system, including most, but by membership in various professional organizations thatnot all, administrative proceedings,6function as a Common have different codes of conduct.).Law adversarial system. When a statute indicates/requires that the neutral hold Appraisers and other valuation professionals are a real property appraisal classification, or the parties selectsubject to USPAP in a wide variety of contexts, and so or a court appoints a person known to hold a real propertyUSPAP tends to be the default, “go to” authority for most appraisal classification, incorrect expectations can result.real property appraisers. But, USPAP itself maps out some These expectations could even rise to the level of a duelimitations on its applicability, and some experts, like The process issue, grounds for vacating an award, or maybeAppraisal Institute’s Stephanie Coleman, MAI, note that even a malpractice concern for the advocates and thethere is a distinction between USPAP applicability and appraisal classification holding neutral. Unless the holderUSPAP enforceability.7USPAP enforceability is a separate of an appraisal classification is being hired as a neutral forissue. It does not even become relevant unless USPAP the express purpose of performing an appraisal (either asapplies. As for applicability, as opposed to enforceability, an appraiser or maybe a “special master”), the neutral isthe Preamble to USPAP itself sends up a huge red flag: probably not serving as an appraiser, but as a passive trier USPAP does not establish who or which assignments of fact who happens to be conversant in the subject matter.9must comply. Neither The Appraisal Foundation nor its As a passive trier of fact, the “appraiser” who serves asAppraisal Standards Board is a government entity with a neutral does not perform the full range of steps that arethe power to make, judge, or enforce law. Compliance usually taken in an appraisal assignment, starting withwith USPAP is required when either the service or the the information gathering that normally accompanies anappraiser is obligated to comply by law or regulation, or appraisal assignment: inspecting the subject, gathering andby agreement with the client or intended users. When not vetting comparables, gathering market data, etc. Indeed, suchobligated, individuals may still choose to comply.8 activities could even constitute “undue means.” Instead, the parties bring the law and the facts and the “appraiser” who So, before one even considers USPAP’s Jurisdictional serves as trier of fact merely analyzes that information andException Rule or USPAP Advisory Opinion No. 21, the settles upon the most correct (or least erroneous) value.first step in the analysis under USPAP is to determinewhether it even applies. USPAP clearly applies 1) “when Depending upon the jurisdiction, there may be aeither the service or the appraiser is obligated to comply pretty easy solution for appraisers and other valuationSpring 2012 9
  10. 10. professionals who are serving as a neutral or mere passivetrier of fact, regardless of its nomenclature:10The appraiseror other valuation professional serving as a trier of factcan make it clear in arbitration submissions, agreements tomediate, and similar documents, which services are and arenot being provided and which professional and ethical rulesare being applied. Copyright 2012 by Jon M. Ripans. All RightsReserved. A longer version of this article can be found at and at M. Ripans, Esq. is a Certified General Real PropertyAppraiser, Member of the State Bar of Georgia, RegisteredNeutral (Arbitration and General Mediation) with the GeorgiaOffice of Dispute Resolution, Secretary to the Property TaxSubcommittee of the Real Property Law Section of the State Barof Georgia, and a Georgia property tax arbitrator and Georgiaproperty tax County Hearing Officer. Jon also serves as acommercial real estate appraiser and expert witness, and also asa property tax advocate under various fee arrangements. He hasgiven presentations to the American Bar Association, Institute forProfessionals in Taxation, the Georgia Department of Revenue,and at Georgia State University School of Law.(Endnotes)1 O.C.G.A. Section 48-5-311(e.1).2 Uniform Standards of Professional Appraisal Practice, Definitions, p. U-1 (Appraisal Standards Board of the Appraisal Foundation 2010-2011).3 O.C.G.A. § 43-39A-2(2). Georgia law further provides: “Analysis” means a study of real estate or real property other than one estimating value. O.C.G.A. § 43-39A-2(1). “’Valuation’ means an estimate of the value of real estate or real property.” O.C.G.A. § 43- 39A-2(20).4 Id.5 O.C.G.A. Section 48-5-311(f).6 Non-adversarial administrative proceedings in the United States can involve an inquisitorial role. See, e.g., In re Beck, 526 F.Supp.2d 1291 (S.D. Fla., 2007) (citing Richardson v. Perales, 402 U.S. 389, 409-10, 91 S.Ct. 1420, 28 L.Ed.2d 842 (1971)).7 My mentioning Stephanie Coleman, MAI, is not to imply in any way that she was given the opportunity even to review this article, let alone endorses any ideas presented.8 USPAP Definitions, p. U-6, Lines 158 through 161.9 “Arbitration discourages litigation, permits parties to resolve their disputes in a specialized forum more likely to be conversant with the needs of the parties and the customs and usages of a specific industry than a court of general legal or equitable jurisdiction, and provides for speedy resolution of disputes in order that work may be completed without delay.” New Hampshire Ins. Co. v. State Farm Ins. Co., 643 A.2d 328, 330-31 (Del. Super. 1993) (citation omitted). [The less polite description would be Spencer and Twain on juries].10 Some possible labels include arbitrator, hearing officer, assessor, judicial adjunct, special master, expert advisor, auditor, etc. Mediators, technically, are not triers of fact. 10 DR Currents