Based on my experience there are two theories regarding the development of an appraisal report for litigation purposes, the minimalist theory that says that you give the opposition attorney as little as possible to attack and the "kitchen sink" theory that says you provide every possible piece of information that you can in your appraisal report. 

MINIMALIST THEORY

I have heard of appraisers in the minimalist mode who offered up a verbal report as their work product.  A verbal report leaves the opposition attorney with absolutely nothing in writing to attack, but the appraiser must be able to actually deliver the details of their verbal report and meet all USPAP’s requirements.  A verbal appraisal presentation in a deposition or at trial is not possible for many appraisers, it’s just too easy to forget something or to get turned around, and thus it is rarely used.

There are a number of ways to limit your exposure as an appraiser in litigation.  One method of appraiser self-protection in litigation is to provide qualitative adjustment grids for litigation reports that are easier to defend than quantitative ones with fixed percentage adjustments.  Some appraisers simply don’t use grids at all, they just discuss why an upward or downward adjustment was made to a comparable sale.   

THE “KITCHEN SINK APPROACH”

Those who tend toward providing everything they can provide self-contained reports or summary reports that have so much detail that they would be considered by many to be self-contained, and they tend to provide more comparable sales than they typically would.  A comprehensive approach of this type is again a method of self-protection appraisers prefer to bolster their analyses when they know that a judge or jury will compare their work with one of their competitors.

If you have the time to do something that the opposition’s appraiser likely will not, like a regression analysis or a review of published articles and books relating to your subject matter, that effort may provide you with the extra ounce of credibility that you need to convince the judge or jury that your opinion is accurate.

While you can sleep well as an appraiser thinking that you have done everything in your power to provide as much detail in defense of your opinion as was possible, reports of this type are a gold mine for attorneys.  A good litigator will find and point out one mistake after another in your report, and they will have you apologizing to the judge or jury for you work in short order.

CASE TYPE

The type of case that an appraisal is completed for is an important consideration for an appraiser.  Reports for condemnations are typically not attacked in the deposition, if one is taken, and if there are blatant errors the opposing attorney will wait to bring them out at trial. 

Appraisals prepared for civil litigation when insurance companies are involved are usually subject to hours and hours of deposition questions with one hypothetical “what if” question being asked after the next, most of questions are usually beyond the scope of the report, but try telling that to an attorney who is being paid by the hour.

What appraisers usually deliver to attorneys for litigation cases are summary reports that are relatively brief and to the point.  Attorneys are careful about not becoming involved in the appraisal process or in the formation of a value opinion.