CUMIS Insurance Society, Inc. v. Wade Massey and Capitol West Appraisals

Summary

The Idaho Supreme Court reviewed a summary judgment dismissing CUMIS Insurance Society’s negligence, negligent misrepresentation, and breach-of-contract claims against an appraiser and his business. The court held that the appraiser’s certifications could establish a duty of care to another lender and that genuine issues of material fact remained regarding how the lender obtained and relied on the appraisal. The judgment was vacated, and costs on appeal were awarded to CUMIS.

Holdings

1. An appraiser may assume a duty of care to a third-party lender when the appraisal expressly certifies that the borrower or another lender at the borrower's request may rely on the appraisal.
2. Summary judgment was improper because reasonable inferences supported the possibility that Icon obtained the appraisal through a distribution method covered by the appraisal's certifications.
3. The USPAP may define an appraiser's standard of care but does not, by itself, impose an affirmative duty of care in favor of a lender that is neither the client nor a designated intended user.
4. The district court did not err in considering the affidavit because CUMIS stipulated in open court that the affidavit could be filed and considered, and CUMIS did not timely seek relief from that stipulation.

Questions Presented

1. Whether the appraisal certifications created a duty of care running from Massey to Icon, a lender other than the original client.
2. Whether genuine issues of material fact existed concerning how Icon obtained the appraisal and therefore whether Massey's assumed duty applied to Icon.
3. Whether the district court properly considered an untimely affidavit after CUMIS stipulated that it could be considered.
4. Whether the district court properly treated testimony from Icon's representative as entity testimony under Idaho Rule of Civil Procedure 30(b)(6).
5. Whether the USPAP provisions cited by CUMIS independently imposed an affirmative duty of care on Massey to Icon.

Disposition

vacated