Help I Got a Subpoena!

Brian L. Trotrier

Brian L. Trotrier

Executive Vice President and Chief Operating Officer at FREA
A former practicing attorney with more than 30 years experience in real estate and risk management. The Foundation of Real Estate Associates (FREA) has specialized in providing Errors & Omissions Insurance to appraisers and home inspectors since 1993. As a membership organization with over 6,000 members, FREA is one of the largest and most well respected professional associations in the country, providing E&O Insurance for appraisers and inspectors as well as educational opportunities, member benefits, and legal support.
Brian L. Trotrier

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Help I Got a Subpoena! - Errors & OmissionsIf you are in business long enough, you will get subpoenaed by someone involved in a dispute that may not even involve you. A subpoena is technically a court order compelling you to appear and testify or to produce records or both. If you are actually involved in the dispute as the plaintiff or defendant, your duty to comply with the subpoena is generally very clear and mandatory.

However, when you are not the plaintiff or defendant, complying blindly with a subpoena without asking any questions may not be in your best interest. As a non-party, a subpoena may be issued to you for two basic (*), but very different, purposes. In the first instance, you may be called as a fact witness and asked to testify to what you saw or did not see. In the second instance, you may be called and asked to render an opinion, also based on what you saw or didn’t see. The main difference is that giving an opinion based on your professional experience is the same as being called to testify as an expert witness and offering an expert opinion may open the door to a future claim against or, in some rare cases, result in you being added to the lawsuit as a new party.

The best way to understand the difference between being a fact witness and being an expert witness is to think about the situation like this. Assume you are an accident reconstruction expert and while you are out walking your dog you see a blue car run a stop sign and hit a red car in the middle of the intersection. Being a good citizen, you call 9-1-1, wait until the police arrive, and then give a statement to the police about what you saw. About a year later you receive a subpoena to testify in a lawsuit filed by the driver of the red car against the driver of the blue car. If you are testifying as a fact witness, you will be asked questions like “did the blue car stop at the stop sign?” or “did you hear the sound of brakes squealing before the crash?” In other words, you will be giving fact testimony. On the other hand, if you are asked to estimate the speed of the blue car at the time of impact based on the amount of damage to the red car, you are being asked to give your professional opinion and that means you are testifying as an expert witness.

If you are testifying as a fact witness, the risk of being added to the lawsuit as a party or being sued separately later is pretty low. However, if you offer any opinions based on your professional experience, the risk of getting embroiled in a dispute is much higher. For this reason, if you have done any work for either party in the underlying dispute you need to get advice before testifying. If you are not sure whether you are a fact witness, you should also seek advice. Very few experts are paid to testify about a real estate transaction they were involved in previously as a primary service provider (appraiser, home inspector, etc.).

For example, if you inspected a home for the buyer a year ago and now the buyer is suing the seller as well as the real estate agents/brokers involved in the sale for not disclosing certain defects in the home, you could be subpoenaed. Then, during questioning about what you saw on the day of the inspection you could get asked a question about your opinion on the condition of the foundation and in your answer you could potentially offer an opinion or make a statement which opens the door for a potential claim against you.

The bottom line is that any professional who is subpoenaed to testify about a real estate transaction where they performed a service for a fee should contact their E&O carrier as soon as they have been served a subpoena so the carrier can offer advice about how to handle the matter. Many carriers also offer free access to outside legal counsel as part of your policy benefits. Finally, in some cases, your E&O carrier might even appoint counsel to seek to quash the subpoena entirely or to limit the scope of questioning to protect you. Just remember it is far better to be safe than sorry.

(*) You could also be served with what is called a subpoena duces tecum. This is a subpoena for records and may not involve testifying at all, especially if you are willing to authenticate the records for the party requesting them.

Brian L. Trotrier

Brian L. Trotrier

A former practicing attorney with more than 30 years experience in real estate and risk management. The Foundation of Real Estate Associates (FREA) has specialized in providing Errors & Omissions Insurance to appraisers and home inspectors since 1993. As a membership organization with over 6,000 members, FREA is one of the largest and most well respected professional associations in the country, providing E&O Insurance for appraisers and inspectors as well as educational opportunities, member benefits, and legal support.

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4 Responses

  1. Walt Lambert says:

    Brian,

    I assure you I am not pandering but I wanted to comment or more appropriately thank you for your articles.

    I find them extremely helpful, well written (which translates, I understand what you’re saying because they lack a lot of legaleze, (I don’t think that’s a word)). I save them and keep them in a file on my desktop for reference.

    The valuation landscape has been a bit rocky recently as I barely print off a white paper on something when (it seems like) a new regulation modifies the prior comments before the ink is dry on the first one.

    I appreciate your contributions, hope you continue to write and wish you continued success.

    Respectfully,

    Walt Lambert

    AZ #21580 Certified Residential

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  2. Mike Ford CA AG, SCREA, AGA, GAA, RAA Mike Ford CA AG, SCREA, AGA, GAA, RAA says:

    All good advice. The first thing I look for on a subpoena is whether or not it has been signed by the judge. Attorneys in Southern California get so casual about these  that they issue them without Judges signatures. As far as I ‘m concerned no signature; no subpoena.

    Additionally, if it is from my clients side I cite my expert witness fees to them ( do NOT make these competitively low-you lose credibility if the attorneys offer to pay you from petty cash!). $300 to $375 per hour seems about right in the L.A. area; plus $75 an hour travel time portal to portal, and an allowance for parking; four hour or eight  minimum is up to you.

    IF my work files are being subpoenaed I cite them as professional work product and INSIST on expert witness fees as noted above; and at a minimum $1.00 a page paid in advance as copying fees & $25 an hour for administrative office expense compensation since I have to hire someone to do this. Only one time have I been subpoenaed with no PW fees agreed to and paid in advance. Notice of this fact to the opposing attorneys side generally opens up an opportunity to say the same thing to the judge who (in my experience anyway); strictly curtailed the line of questions the attorney was allowed to ask to “Did you write this report” rather than WHY I wrote something.

    ANY attorney that subpoenas an unwilling appraiser (at least in residential work) is generally making a HUGE mistake. They are likely to hear nothing more than “I don’t recall right now.”

    EW work is a good source of additional income. I’d keep it to less than 10% of your total work or you will be seen and treated as a hired gun or shill for attorneys. I welcome it, but don’t be fooled into thinking you have to do it for free. You do not. You may have to appear, and you always tell the truth but that is all. Having a faulty memory is just being human.

    Last bit. NEVER answer right away. Always take the time to repeat the question to yourself or out loud (THAT annoys the hell out of them, by the way) and THINK about whether the question or answer was within the scope of work performed and your specific expertise. I made THAT mistake only one time. Honest answer; personal opinion about ‘responsible lending practices’. I KNEW the answer but fact is it was subjective and outside the scope of my professional expertise. My client never let me know that they had never even read the original report for which they later paid me to review, but they HAD admitted that in THEIR deposition! They still won but amount was reduced due to their contributory negligence & I lost that attorney as a future client. Tough lesson.

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  3. Retired Appraiser Retired Appraiser says:

    Congratulations…are you surprised?

    Anyone who stayed in this “profession” after 2009 deserves at least one subpoena and a series of trips to a professional psychiatrist’s office.

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  4. Mike Ford Mike Ford says:

    You misunderstand. I LIKE subpoenas because to me they are the ringing of the cash register. When else can we realistically quote over $300 an hour AND GET IT? Heck, even that’s low now! I think I’ll raise it to $350 and maybe drop the minimum hours? What do you think? (its not all that frequent). Only a few chances a year.

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