What’s the statute of limitations for a lawsuit against an appraiser? This is a common question because many lawsuits against appraisers are filed years after the appraisal, sometimes 10 or more years later. The reason for this is that the plaintiff suing an appraiser may not have known there was a problem with the appraisal at the time it was received or may not have suffered any damages as a result of the alleged error until a loan default or other event has occurred years down the road. This plaintiff might be a lender who has foreclosed on a loan or a borrower who believes they paid or borrowed too much based on an allegedly negligent appraisal. And, in many cases, the parties who want to sue an appraiser may have just “sat on their hands” for years and taken no action.
The applicable statute of limitations for an appraisal-related claim will vary based on: (a) the nature of the claim (for example, whether it is for negligence, fraud or breach of contract), (b) the state whose law will apply to the claim, and (c) in a few cases, who is making the claim (federal law, for example, extends the time for the FDIC to take legal action). Based on these factors, the time period might be as short as one year or as long as 10. And, then there’s the discovery rule… .
What’s the “discovery rule?” The discovery rule – if followed in a given state – is a rule for determining when the statute of limitations time period begins running. In most states, the time period does not simply start running on the date of the appraisal. Instead, it generally begins running when the plaintiff has discovered, or should have discovered, the alleged error in an appraisal or suffered damage resulting from the error. So, that means the time period may not start running until years after the appraisal; for example, a lender may claim it did not know of the deficiencies in the appraisal until it foreclosed on the property, or a borrower may contend they didn’t know about an appraisal error until another appraiser brought it to their attention.
Statutes of Repose. Because it often seems unfair for an appraiser to be sued over a very old appraisal (I’ve seen appraisers sued over 12+ year-old appraisals), appraiser organizations have been successful in persuading legislators in some states to enact specific maximum time periods in which lawsuits against appraisers can be filed. These special laws are generally called statutes of repose, which are perhaps best described as statutes of limitation on steroids. In contrast to a statute of limitation, a statute of repose generally serves as an absolute time bar to a potential claim, setting a clear deadline. Some states that have enacted strict time limitations on claims against appraisers include: Arkansas, Arizona, Louisiana, Minnesota, Mississippi, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, and Wisconsin. In these states, different time limitations may apply to appraisals based on the date of the appraisal, which underscores the importance of obtaining knowledgable legal advice.
What’s the time period in your state? Does your state apply a discovery rule or have a “statute of repose?” The most common legal claim against an appraiser is for negligence. The chart below answers these questions state-by-state for appraiser negligence claims. If you are defending or considering an actual claim, you should always seek out knowledgeable legal advice in your own state (do not rely on the chart as a substitute for legal advice). If you think a correction should be made in the information below, please share your thoughts with me ([email protected]).
This chart was last updated April 10, 2024.
| State | Years | Does a "discovery rule" potentially apply to a professional negligence claim against an appraiser? | Underlying State Statutory Source |
|---|---|---|---|
| Alabama | 2 | No, unless fraud is present. | Alabama Code § 6-2-38 |
| Alaska | 2 | Yes | Alaska Code of Civil Proc. § 09.10.070 |
| Arizona | 2, with a 4-year statute of repose for appraisals after the effective date of HB 2230 | Yes; however, on 4/28/23, Arizona enacted HB 2230 creating a 4-year statute of repose for claims against appraisers (does not include AMCs). | Ariz. Rev. Stat. Ann. §§ 12-531, 12-542 |
| Arkansas | 3 | No. Arkansas has adopted an appraiser-specific statute of limitations with no discovery rule, unless the claim is for intentional fraud. | Ark. Code § 17-14-206(c)(1) (as amended by SB 394 in 2019) |
| California | 2 | Yes | Cal. Civil Proc. Code §§ 338(d), 339, subd. 1 |
| Colorado | 2 | Yes | Colo. Rev. Stat. § 13-80-102 |
| Connecticut | 2 | Yes | Conn. Gen. Stat. Ann. § 52-584 |
| Delaware | 3 | Yes | 10 Del. Code § 8106 |
| Florida | 2, with a maximum period of 4 years from appraisal (per H213 enacted effective 7/1/23) | Yes. (Under prior law before H213, discovery rule applied for claims by clients or those in "privity" with appraiser. For claims by other parties, the limitations period was 4 years with no discovery rule.) | Fla. Stat. Ann. § 95.11(4)(a). |
| Georgia | 4 | The limitations time period and whether a discovery rule applies for negligence claims against appraisers in Georgia has not been difinitively determined. | Ga. Code Ann. § 9-3-31 |
| Hawaii | 6 | Not determined. The case law in Hawaii does not support a firm conclusion as to whether the discovery rule would apply to claims against appraisers. Recent appellate decisions have applied a discovery rule to malpractice claims involving medical professionals and attorneys. | Haw. Rev. Stat. § 657-1 |
| Idaho | 2 | No | Idaho Code § 5-219 |
| Illinois | 5 (there is no specific precedent for appraisers, however, and at least one court has stated in "dicta" that it is 2 years) | Yes | 735 ILCS 5/13-205 |
| Indiana | 2 | Yes | Ind. Code § 34-11-2-4 |
| Iowa | 2 | Yes | Iowa Code Ann. § 614.1 |
| Kansas | 2 | Yes | Kan. Stat. Ann. § 60-513 |
| Kentucky | 1 | Yes | Ky. Rev. Stat. Ann. § 413.140(3) |
| Louisiana | 1 with a 3-year statute of repose effective 1/1/20 | Yes; however, effective 1/1/20, Louisiana has enacted a statute of limitations providing that any action against an appraiser or appraisal management company must be filed at the latest within three years from the date of the relevant act, omission or neglect. | La. R.S. § 9:5610 |
| Maine | 6 | Yes | Me. Rev. Stat. Ann. Tit. 14, § 752 |
| Maryland | 3 | Yes | Md. Cts. & Jud. Proc. Code Ann. § 5-101 |
| Massachusetts | 3 | Yes | Mass. Ann. Laws ch. 260, § 4 |
| Michigan | 2 | Yes, but the discovery rule is limited - an action must be filed within 6 months of the plaintiff's discovery of the claim. | MCL 600.5805(9) and MCL 600.5838(2) |
| Minnesota | 6 | Under Minn. Stat. § 82B.24, Subd. 4, an action must be filed no later than 6 years from the date of the appraisal. | Minn. Stat. § 82B.24, Subd. 4 |
| Mississippi | Earlier of 3 years after discovery or 5 years after intended user relies on appraisal | Yes, but subject to maximum time period of 5 years after intended user relies on appraisal | Miss. Code Ann. § 15-1-49 and § 15-1-83 |
| Missouri | 5 | Yes | Mo. Ann. Stat. § 516.120 |
| Montana | 3 | Undetermined | Mont. Code Ann. § 27-2-204 |
| Nebraska | 2 | Yes | Neb. Rev. Stat. § 25-222 |
| Nevada | 4 | Undetermined | Nev. Rev. Stat. Ann. § 11.190 |
| New Hampshire | 3 | Yes | N.H. Rev. Stat. Ann. § 508:4 |
| New Jersey | 6 | Yes | N.J. Stat. Ann. § 2A:14-1(a) |
| New Mexico | 4 | Yes | N.M. Stat. Ann. § 37-1-4 |
| New York | 3 | No | N.Y. Civ. Prac. L. & R. § 214 (6) |
| North Carolina | 3 with a 5-year statute of repose | Yes; however, North Carolina has adopted a "statute of repose" that imposes a maximum time period on claims. A claim for negligence against an appraiser, even under the discovery rule, must be filed within 5 years of the appraisal. (N.C. Gen. Stat. §1-51(4).) | N.C. Gen. Stat. § 1-15 and § 1-52(9) |
| North Dakota | 2 | Yes, within 2 years of discovery up to a maxium of 6 years. | N.D. Cent. Code § 28-01-01, et seq. |
| Ohio | 4 | No | Ohio Rev. Code Ann. § 2305.09(D) |
| Oklahoma | 2 | Likely; see Calvert v. Swinford, 382 P.3d 1028 (Okla. 2016). | 12 Okla. Stat. § 95(3) |
| Oregon | 2 with a 5-year statute of repose | Yes; however, Oregon has adopted a "statute of repose" that imposes a maximum time period on claims. A claim for negligence against an appraiser, even under the discovery rule, must be filed within 5 years of the appraisal. | Or. Rev. Stat. § 12.132 (as amended by HB 3218 in 2019) |
| Pennsylvania | 2 with a 5-year statute of repose for appraisals not performed for a consumer effective 2/20/22 | Yes; however, Pennsylvania has enacted a "statute of repose" that imposes a 5-year maximum time period on claims from completion of the appraisal, except in cases of fraud or when the appraisal was performed for a consumer in connection with the purchase or sale of a single-family home not involving a lender. | 42 Pa. Cons. Stat. Ann. §§ 5524, 5539 |
| Puerto Rico | 1 | Yes | P.R. Laws Ann. tit. 31, § 5298 |
| Rhode Island | 10 | No | R.I. Gen. Laws § 9-1-13(a). Note: Under R.I. Gen. Laws § 9-1-14.1, the statute of limitations is 3 years with a discovery rule for "medical, veterinarian, accounting, or insurance or real estate agent or broker malpractice," but appraisers are not included within that statute. |
| South Carolina | 3 | Yes | S.C. Code Ann. § 15-3-530 |
| South Dakota | 3 | No | S.D. Codified Laws § 15-2-35 |
| Tennessee | 3 with a 5-year statute of repose | Yes; however, Tennessee has enacted a "statute of repose" that imposes a maximum time period on claims. A claim for negligence against an appraiser, even under the discovery rule, must be filed within 5 years of the appraisal. | Tenn. Code Ann. § 28-3-104(d). Tennessee's appraiser-specific statute of limitations with the 5-year maximum time period only applies to appraisals after July 1, 2017. |
| Texas | 2 with a 5-year statute of repose | Yes; however, Texas has enacted a "statute of repose" that imposes a maximum time period on claims. A claim for negligence against an appraiser (including AMCs), even under the discovery rule, must be filed within 5 years of the appraisal (eff. 9/1/21). | Tex. Civ. Prac. & Rem. Code Ann. § 16.013 |
| Utah | 4 | No; however, Utah has a very limited "equitable" discovery rule that can be applied when a defendant has concealed the alleged wrongdoing. Utah's "equitable" discovery rule is addressed in Russell Packard Development, Inc. v. Carson, 108 P.3d 741 (Utah 2005). | Utah Code Ann. § 78B-2-307(1)(a). The conclusions regarding a 4-year time period and application of § 78B-2-307(1)(a) are based on Lilley v. Chase, 317 P.3d 470 (Utah Ct. App. 2013). |
| Vermont | 6 | Yes | 12 Vt. Stat. Ann. § 511 |
| Virginia | 5. See remarks. | No. There is no published case involving an appraiser in VA. The conclusion is based on professional negligence cases involving attorneys, architects and insurance brokers. | Va. Code Ann. § 8.01-246. A 3-year period should apply if there was no written agreement for performance of the appraisal. |
| Washington | 3 | Yes | Wash. Rev. Code Ann. § 4.16.080 |
| West Virginia | 2 | Yes | W. Va. Code 55-2-12 |
| Wisconsin | 5 | Wisconsin has enacted an appraiser-specific 5-year statute of repose for claims against appraisers running from the date the appraiser submits the report to the client (does not include AMCs). | Wis. Stat. Ann. §§ 893.53, 893.895 |
| Wyoming | 2 | Yes | Wyo. Stat. § 1-3-107 |
Important: The information in this chart is subject to ongoing legal research and may also be impacted by new statutes and cases. The information in this chart should not be relied upon in making any legal decision, including, but not limited to, deciding whether or when to file any legal action. A reader should consult with knowledgeable local legal counsel with regard to any legal decisions. The information is also not to be construed as an admission of fact or law and is offered without prejudice to any legal position or defense of any party.