Legal Question in Real Estate Law in California
Can the appraisal be done without our signatures?
My husband and I are in the process of building a new home. We have been dealing with two different loan officers who were helping us obtain the best rates. We have filled out loan applications and provided the required documentation to both,including a check for the appraisal fee. However, we had not signed a contract with either loan officer nor given any consent to send out the appraiser.
We have now chose one of the loan officers and signed a contract. We have signed consent with him to send out an appraiser. To be safe we put a stop payment on the check given to the other loan officer for the appraisal fee.
Well, we just received a call from the appraiser who was sent to do the appraisal from the other loan officer we are not using, stating he completed the appraisal and tried cashing the check, and obviously it was refused. We had never given authorization to that loan officer to send out the appraiser as we had not determined who we were going to use as our lender. The appraiser is threatening to take us to small claims court if we don't pay him his fee. Does he have any legal right without our written consent? Do we legally have to pay him for his services? What are our options?
Sincerely,
Michelle
2 Answers from Attorneys
Re: Can the appraisal be done without our signatures?
So, you made two people work for you, knowing that you would only use one. Did you inform both of the loan brokers that you were also working with someone else to see "who could get you the best deal?"
What would you think if you went to work one day, and you were not paid because your boss had two people working on the same project, and the other did the job quicker or better?
Re: Can the appraisal be done without our signatures?
Section 1719 of the Civil Code covers dishonored checks, including checks not paid due to a stop payment order as well as NSF checks, etc.
In order not to be subject to civil penalties for stopping payment, there must be a "good faith dispute" between payor and payee; these are defined to include non-delivery of goods or non-performance of services, goods defective or not what was ordered, etc.
I have considerable doubt that you can claim a good-faith dispute with the appraiser; you seem to have contracted for appraisal services and you seem to have received the appraisal.
Your proposed defense that you did not sign an additional authorization or notice to proceed seems weak. You did, after all, apply for a loan, and you knew the lender would require an appraisal, and that you were to pay for the appraisal. You tendered a check in payment, and the appraisal was duly made. You apparently failed to notify this loan broker that you had made other arrangements to finance the property.
Apparently, one broker's internal procedures called for obtaining a separate authorization to proceed with the appraisal, while the other's did not. I am not aware of any law that would require the lender or loan broker to obtain a separate authorization from the borrower to proceed with an appraisal, especially after the check for the appraisal has been delivered.
I have a sister-in-law who is a residential real estate appraiser; I'll ask her when I can reach her and if I get a different slant on things I'll post a supplemental reply. At this point, however, your case looks weak.
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