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Tuesday, December 29, 2015

USPAP - My Pathway to Expert Witness

By Suzanne Sellers Houck, ISA CAPP, B.A. and M.A.L.S., ISA Board Member

Have you added expert witness testimony to your bank of services yet? If not, and a perceived lack of “expertise” is your reasoning, USPAP could be your solution. Throughout my career, my courtroom experience has been very limited. But all of that changed recently, when I had the opportunity to provide expert witness testimony in a class action lawsuit against a major insurance company.

The suit claimed that settlements for depreciable household items were being settled illegally, specifically by age depreciation only. I was skeptical about what role I could play given my limited experience in writing insurance claims appraisals. I’ve often considered specializing in an area but never did, and I still classify myself as a generalist; generalists, in my mind, don’t often provide expert witness testimony. But that was all before USPAP opened the door for more business possibilities for me.

During our initial conversation, the plaintiffs’ attorney told me he had found me through the ISA website. What surprised me most about our initial conversation was that he was most interested in talking to me about appraisal methodology, not necessarily my “product knowledge,” although that too was relevant. I had just taken the USPAP update a couple months prior, so I was feeling very refreshed and empowered. "Tell me more," I said.

The suit involved California Insurance Code 2051 2014. (I’m sure other states have similar laws.) This law addresses claims settlement procedures and focuses on the concept of physical condition at the time of loss without ever mentioning consideration of a specific marketplace, specifically payment of actual cash value. I explained that Actual Cash Value is considered an insurance term and that as an appraiser I deal with Replacement Cost New or Comparable.

I explained to him that all appraisals by definition consider the Intended Use of the appraisal (insurance, selling, estate planning, etc.) and Objective of the appraisal (determining fair market value, market value, estimating replacement cost, determining loss of value, etc.) and that each value definition has a specific market. There are four primary markets we consider. They are the retail market, wholesale market, orderly liquidation market, and distress liquidation market. Appraisers choose the market based upon the intended use of the appraisal, the object(s) being appraised and its many value characteristics: Type of Item, Size, quality, Age, Condition, Alterations and/or restorations, style, Materials, Authorship or manufacturer, Country of origin, Subject matter, Provenance, and obsolescence/usefulness. I explained how using just age or physical condition would result in different (often inflated) value conclusions, a fact that further emphasized the importance of considering multiple value characteristics within a specific marketplace.

He then asked for details about my training through ISA. I am proud of our extensive educational program and welcomed the opportunity to explain it. He had no idea certified appraisers went through such extensive training.

Moving forward, I prepared for my depositions by reviewing my ISA and USPAP manuals, concentrating on Standard Rules 7 and 8, as well as sections relevant to appraiser's use of marketplace. I highlighted and sent the attorney Standard Rule 7-3 (b) which defines and "analyzes the appropriate market consistent with the type and definition of value and comments the appraiser must recognize that there are distinct levels of trade (measurable marketplaces) and each may generate its own data."

In Standard 8, I highlighted 8 (a) iii which states: "Content of an Appraisal Report must be consistent with the intended us of the appraisal and at a minimum ... summarize information sufficiently to identify the property involved in the appraisal including the physical and economic property characteristics relevant to the assignment."

When you are providing expert witness testimony, you need to be aware that everything in your work file will likely become public. Mine was copied and, during the trial, my highlighted sections of USPAP were used as Exhibits and projected onto all screens in the courtroom. What great exposure for USPAP and ISA .

The information I sent might seem basic to you seasoned appraisers, but my observations were that this information was news to the attorneys present. At one point I was asked if I was "certified" in the state of California.

"No sir, I am not," I answered, observing the surprised glances between the attorneys before continuing. "I have a business license in the state of California, but I am a certified appraiser of personal property through the International Society of Appraisers and all my reports are compliant with the USPAP standards as set forth by the Appraisal Standards Board, a Congressional subcommittee."

After the trial, I was waiting by the curb for my taxi when the main defense attorney approached me and asked, “Where are you from?” 

“Southern California,” I replied, quickly adding, “Where I often write appraisals for your insureds and hope to continue to do so!”

He smiled and asked, “Do you have a card? I am looking for an appraiser.”

I don’t yet know the outcome of the trial, but I believe my concentration on USPAP and my ISA education helped promote my professionalism and hopefully that of the entire appraisal business for those present that day. Thanks, ISA, for providing that education and allowing me to expand my business practice in a very lucrative and exciting direction.

Tuesday, December 22, 2015

The Top 5 Reasons to Use the artnet Price Database

The following is a sponsored post by ISA Affinity Business Partner (ABP), artnet. Learn more about the ABP membership

Édouard Manet
Le Printemps, 1881
Oil on canvas
29.1 x  20.3 in.
Signed and dated
Sold for US$65,125,000 Premium at Christie's New York
on Wednesday, November 5, 2014

1. Two Trusted Databases for Two Different Markets

The artnet Price Database Fine Art and Design contains auction results for all paintings, prints, sculptures, works on paper, installations, and design from the 20th and 21st centuries, while the artnet Price Database Decorative Art includes objects such as furniture, silver, porcelain, ceramics, glass, rugs, carpets, clocks, books, jewelry, watches, and more.

Both databases have become the most trusted art market research tool for auction houses, galleries, appraisers, collectors, art enthusiasts, and students.

2. Unparalleled Scope

Our data goes back 30 years, with over 10 million color-illustrated auction results from more than 329,000 artists—the most comprehensive archive of auction results ever recorded.

3. A Global Network

We currently cover over 1,700 houses in more than 50 countries, ranging from the largest international houses to smaller regional auctions. Users can access this global network to discover comparable lots to facilitate appraisals, or to gauge the current art market.

4. Precise Accuracy

Both databases have strict requirements in order to have lots included, ensuring both the quality and accuracy of our information.

All lots in the Price Database Fine Art and Design must have the following price requirements:
  • Original paintings, sculptures, works on paper, photographs, prints and multiples, installations, and contemporary mixed artist portfolios must have a minimum low estimate of 500 USD
  • Artists with a “qualified” name, (e.g., after, follower of, circle of, school of) or artists known only by their initials, nationality, or period; artists known as master or monogrammist; artists known only by first or last name (for whom the full name cannot be identified); and anonymous artists must have a minimum low estimate of 2,000 USD   
All lots in the Price Database Decorative Art must have must have the following price requirements:
  • All furniture, silver, porcelain, ceramics, glass, rugs, carpets, clocks, books, jewelry, watches, and other decorative art objects must have a minimum low estimate of 500 USD
5. Edited by a Team of Experts

The Price Database team consists of 15 multilingual specialists that study and edit each lot before posting it online. Every single lot is checked for accuracy against auction catalogs, and our team edits an average of 68,000 lots per month—allowing us to stay on top of global art market trends and to monitor developments in price range, international collector’s interests, local trends, top-selling objects, emerging artists, and upcoming art markets.

Discover the artnet Price Database for Yourself

Trusted by prestigious auction houses, galleries, buyers, and sellers all over the world, the artnet Price Database Fine Art and Design has always been the leader for art market research.

We invite you to discover (or rediscover) the power of the Price Database for yourself. Access ten free searches in the Price Database Fine Art and a two-week free trial of the Price Database Fine Art. Click here and enter code ISAPD4HH to activate your trial today.

Questions? Contact an artnet client service specialist at We are here to help.

Offer must be redeemed by January 31, 2016. A credit card is not required to activate the trial.

Monday, December 14, 2015

The Antiques & Residential Contents Guide – Update Your Resource Library with the Newest Edition
Thanks to the tireless efforts of its current co-editors Libby Holloway, ISA CAPP, and Michael Logan, ISA CAPP, one of our primary texts, A Guide to the Identification and Evaluation of Antiques and Residential Contents, has received notable revisions for its 2015 edition. Previous versions were published in 1996 and 2011, with the latest changes in form and content ensuring that the current guide reflects industry trends, best practices, and ever-evolving appraising procedures. The 2015 edition features significant additions, including color photographs, as well as brand-new sections regarding the writing of reports, tips for research, and more.

The ISA Antiques & Residential Contents (ARC) course was developed to provide specialty knowledge to those appraisers who cover the world of general household contents, be they antique or contemporary. This manual, which contains extensive information on 19th and 20th century furniture and accessories that forms the basis for how appraisers examine residential property, is not a price guide but rather a how-to source for procedures that include identification, evaluation, and connoisseurship.

From the preface by Leon Castner, ISA CAPP, Director of Education:
This is one of the only texts that cover the contents of a house from attic to basement, wall décor to floor coverings. It provides the information necessary for anyone seeking to become an appraiser, dealer, auctioneer, or estate sale agent, or anyone seeking a comprehensive and thorough foundation of the world of antiques, collectibles, and general residential contents.

This book has proven itself to be a crucial guide to ISA members seeking reference to the world of antiques and residential contents. Purchase your copy of A Guide to the Identification and Evaluation of Antiques and Residential Contents from ISA’s online store.

Wednesday, December 9, 2015

Invitation from the President: Expand Your Appraisal Horizons in Dallas and Fort Worth, Texas

By Christine Guernsey, ISA CAPP, President

It is my absolute pleasure to invite all my colleagues to my hometown of Dallas and Fort Worth, Texas, April 15-18 for ISA's Annual Conference, Assets 2016.

Our conference theme, "Expanding Horizons," focuses on an ever-changing industry and finding new opportunities for your appraisal practice. By attending, you will gain insight into the new directions industry-related gatekeepers are taking with their clients and how appraisers can collaborate for increased business; learn advanced methodologies to solve unique and difficult appraisal assignments; discover how to forecast future trends and advance your connoisseurship; and identify new business strategies that will help expand your appraisal horizons.

This year’s conference speakers continue ISA’s tradition of bringing you top industry experts. They include, to name only a few, Michael Moses of the Mei Moses Index; Peter May of LinkedIn’s “Art Solutions…Best in Practice” and “Trusts & Estates Network” with a combined 25,000-plus followers; Michael Plummer of Artvest; Lark Mason of Lark Mason Associates and IGavel; and an inspiring keynote presentation by Dennis McCuistion, award-winning host of the PBS television news show, the McCuistion Program.

The beautiful, newly renovated Hilton Hotel in Fort Worth, will host ISA. Renowned for its celebrity guests including JFK, this downtown hotel is a few blocks walk from Fort Worth’s Sundance Square where you will find a variety of great restaurants, shops and entertainment which are all affordable, easily accessible and safe for walking at night. For $10 per day, the Trinity Railway Express (located one block behind the hotel) will take you all around the DFW area as well as the Museum District in Dallas. Fort Worth’s Cultural District, with three major museums and its historic Stockyards, are all just minutes away.

We have arranged two days of special tours for conference attendees. Thursday, enjoy a very special hands-on, behind-the-scenes tour at Heritage Auctions in Dallas. Friday, tours include a stop to the Design District in Dallas to visit Pittet Architecturals, one of the leading importers of European architectural elements in the United States, NorthPark Mall's Raymond Nasher collection, the Dallas Art Fair with over 90 exhibitors of Contemporary art, the Crow Collection of Asian Art, The Dallas Museum of Art (with both decorative and fine arts) and the acclaimed Nasher Sculpture Center.

You can’t afford to not attend Assets 2016. It is an investment in your future appraisal practice, a commitment to your continued appraisal education and a chance to network with some of the top professional peers in our organization.

I invite you to take a closer look at the Assets 2016 program and to register early for savings. It will be great to see you in my hometown. You will leave knowing it was well worth the trip!

Wednesday, December 2, 2015

ASK LEON: Should I reject assignments due to my "competency"? If so, how do I gain experience in these appraisals if I'm required to reject them?

ISA members are invited to send in their questions on all things appraising and education to Leon Castner, ISA CAPP. Leon will share his answers on the ISA Now Blog. Please send questions to

I just completed another organization’s 7-hr. online USPAP course. I am very curious if something said was an organizational opinion or a general USPAP requirement.

While the instructor was talking about “competency,” she mentioned one must make the case in the cover letter as to why you are qualified to write this particular appraisal assignment. Particularly, she expressed concern that generalists don't know what they don't know and should be extremely wary before accepting assignments. She gave this example: if you are asked to appraise a Picasso and you have only appraised a couple, then you should NOT accept the appraisal. Only someone who has appraised hundreds of Picasso's would be qualified to handle this assignment.

This really freaked me out. So many questions ran through my head. How can you gain experience if we can't accept assignments? Doesn't the CV state appropriate information regarding qualifications? Why did I just earn my dual AM designation if I don't have enough experience appraising the "heavy hitters" to accept (if only I would be that lucky!) such an assignment?

Answer: Yes, the competency rule states that you have 3 choices when confronted with any assignment:
  1. You are competent to do it and tell the client you are.
  2. You are not competent and you refuse the job.
  3. You are not competent, but you will take steps to do the job competently. This means any number of options, which are left up to you and the client. You can take steps to become competent yourself (hard to do in a short time frame), work with a qualified appraiser or team to do the job, or a combination of the two. That’s how we gain knowledge in other areas: we accept challenges and then become proficient enough to finish the job. No one can decide how many items one must do to claim competency. I would venture to say that what the instructor said might have more to do with authentication than appraising, although her point is that a generalist is not an expert in everything (which I agree with completely). However, just because one is a fine art expert doesn’t mean they can automatically do every piece of art either. Everyone has limits. You must confront them when asked to do an assignment and then decide if you can take steps to do the job competently. You must disclose those steps to the client and in the report.
Question: What role does provenance play in valuing an item? I had an inquiry about an appraisal for insurance replacement of custom tailored textiles made for political figures in a local history collection.

Answer: Great question. It would take a book to answer it. Provenance is a value characteristic of an item that the market deems very significant. One of the problems, however, is that for insurance coverage it is very difficult to put a replacement cost on the item since, in a sense, it is not replaceable. One can either compare the item to other items (parallel market) or estimate the cost to replicate/duplicate them if lost. The owner might want to insure them for the potential market value based on what similar items bring in the marketplace. For example, the opera glasses Lincoln used at the Ford Theater are just $200 opera glasses. They could be replaced easily. However, the exact opera glasses that he held in his hands brought over $400,000 when sold. If you were the new owner, wouldn’t you want them insured at $400,000 rather than $200? That’s provenance.

Tuesday, December 1, 2015

The "Circle of Trust" Deepens the Collaboration Between the Major Appraisal Organizations with the Development of Formal Mission and Vision Statements

By Cindy Charleston-Rosenberg, ISA CAPP
COT organization leaders, including
Christine Guernsey, ISA CAPP, President,
Cindy Charleston-Rosenberg, ISA CAPP,
Immediate Past President, and
Todd Sigety, ISA CAPP

One of the goals of ISA's three-year Strategic Plan is to advance ISA's industry standing among users of appraisal services. As part of this directive, ISA is committed to working with peer appraisal organizations to raise public awareness and demand for meaningful personal property appraising credentials.

To help guide this initiative and frame the overall scope, ISA, AAA and ASA have furthered our collaboration with the development of mission and vision statements, announced Monday in a joint public press release.   

The mission of the Circle of Trust (COT) is: "To raise public awareness of qualification standards for credentialed personal property appraisers who are members of The Appraisal Foundation sponsoring organizations." The concept of limiting participation in this collaboration to TAF sponsoring organizations is, that for sponsors, adherence to the AQB qualifying criteria will now be mandatory. This protects the public from individuals who may be practicing to a lower standard and without organizational accountability.

The next meeting of the COT organizational representatives will be in April at the ISA Annual Conference in Dallas/Fort Worth. At this meeting, the COT intends to move the mission forward with activities geared toward educating allied industry users. The participating organizations believe that as a result of our unified efforts to raise public awareness, informed consumers and allied professionals will recognize, and increasingly demand, meaningful personal property appraising qualifications.

I am proud to be ISA's member representative in this effort, and invite your ideas and comments. Please contact me at: or 215 346-2799.