A Missouri Court of Appeals recently held that an appraiser may advocate for the party that appointed the appraiser as long as the appraiser has no financial interest in the outcome of the appraisal.

In Allstate Indemnity Company v. Gaworski,1 Allstate petitioned the trial court to disqualify the insureds’ selected appraiser, contending that the appraiser was not “disinterested” because the appraiser:

  1. Had an ongoing relationship with the company hired by the insureds to make the subject repairs and to which the insureds had assigned their contractual interest in their claims against Allstate, and
  2. acted unprofessionally and aggressively in his communications directed to Allstate.

In denying Allstate’s petition to disqualify the insureds’ appraiser, the trial court reasoned:

[A]lthough there was evidence of [the appraiser’s] ‘unprofessional conduct, aggressive rhetoric, and ominous emails,’ there was insufficient evidence of a disqualifying financial interest on his part.2

On appeal, the court agreed with the trial court, but expanded upon its reasoning, stating:

Although there is evidence in the record that [the insureds’ assignee] hired [the appraiser] for previous jobs, this does not constitute sufficient evidence of frequent or habitual employment rising to the level of a disqualifying bias.3

The appellate court also found:

An appraiser is not required to be entirely impartial. Instead, they may act as advocates for their respective parties without violating their commitments. Here, while [the appraiser’s] communications are certainly ‘aggressive,’ as noted by the trial court, they do not evidence a disqualifying bias against Allstate. Instead, [the appraiser’s] emails evidence his advocacy on behalf of the [insureds]….

These rulings help clarify the line between acceptable advocacy by an appraiser and improper bias or prejudice.
________________________
1 Allstate Indem. Co. v. Gaworski, No. ED106079, 2018 WL 3028851 (June 19, 2018).
2 Id. at *1.
3 Id. at *2 (citations omitted).

  • would this help in (or apply to) cases in FL where state farm will not allow another PA in a firm to act as appraiser for the assigned PA of that same firm? to clarify – the assigned PA gets paid a %, but the appraising PA (acting only as appraiser, not as PA) gets paid a stated dollar amount, regardless of the outcome of the appraisal.

  • shirley heflin

    Dear Mr. Moon:

    I’d be more concerned about the Umpire being impartial than an Insured’s Appraiser. Anyway, glad to see the Missouri Appellate Court got it right.

    Respectfully,
    SHIRLEY HEFLIN
    Tampa, FL

  • J Johnson

    I would have to agree that not letting a appraiser with ties
    to the contractor might make it to difficult for the insured. However, if
    either party gets aggressive or rude ,
    judge should be able to disqualify them. There is no reason for either
    party to act in that manner.
    ***
    However, allowing an appraiser from the same firm as the PA
    might just be a little too lenient as neither party should have too large of a
    financial interest in the outcome.

  • jeffrey C. Pellet

    Allstate did not like the “tone of the email thread” between the appraisers and as the writer, I made it clear that Allstate did not have the last and only word in the process. More so, the writer had a total of 3 previous cases in which, Allstate was only one of the three remaining cases. Interestingly so, the Allstate selected Appraiser held a far, far greater number of previous assignments as a “repeat appraiser”… Has anyone asked how much was spent on defense dollars to bring the action?

    Jeffrey C. Peller

  • Edward Fako

    I have been scouring the Case Laws on this topic for nearly a year right now in a quest to seek a reasonable method of disqualifying an opposing Insurers Appraiser, who makes a substantial income both as a damage assessment consultant and as an Appraiser for several of the most notoriously known Insurers who gave the poorest claims handling reputations.

    This party has even had a State Appellate Court rule that his actions were Tainted And Corrupted the particular Appraisal in question and his Umpiring Award was Vacated.

    The best method seems to come from the Arbitration Rules, where in some States, Appraisal has been legally determined to be Analogous to Arbitration. There is some good Statute regarding this also, but primarily only in California.

    What should the process be to seek to Discharge a corrupt, biased and tainted Insurer side Appraiser?

    I have recently started sending a minimalistic Disclosure Questionairre to lay the foundation for future legal remedies when this person does what he always does. So far, he has notvreplied to the Disclosure Questionairre, which is what I suspected. That may become useful if g is Umpire candidate is selected, whom also was labeled as Tainting and Corrupting the Appraisal process in the previously mentioned Appellate Court ruling.

    I am open for suggestions.