John Buford Wins Summary Judgment in Real Estate Appraiser Case

Brooks Pierce litigator John Buford recently won summary judgment for two appraiser clients in a recent opinion from the North Carolina Business Court. These two appraisers were sued by two dozen plaintiffs over a mountain-view real estate development in McDowell County that failed when the developer went bankrupt. In the ruling, the Business Court clarified several outstanding legal issues that will benefit North Carolina appraisers in future cases.

At issue in Cabrera v. Hensley was an upscale development known as Wild Ridges at Morgan Creek. The developer sold lots in 2006 and 2007 before infrastructure was complete, and went bankrupt when the real estate market collapsed, to the chagrin of the lot purchasers. A total of 54 plaintiffs sued a total of ten appraisers in McDowell County Superior Court, and the lawsuit was assigned to the Business Court. The plaintiffs asserted claims for negligence, fraud, and unfair and deceptive trade practices.

Judge Murphy dismissed all claims against all appraisers in a 26-page opinion that adopted a number of arguments asserted by Brooks Pierce, including:

• The appraisers, who were retained by lenders rather than by lot purchasers, owed no duty to the lot purchasers.
• Neither the appraisers nor the lenders intended that the lot purchasers rely on the appraisal reports.
• The purchasers had already contracted to purchase the lots before any appraisal was performed.
• A plaintiff cannot prevail on claims for fraud and negligent misrepresentation by relying on a third party who in turn relied on an alleged misrepresentation.

John has represented corporate and individual clients in a variety of sophisticated business disputes, including issues of professional liability, unfair and deceptive trade practices, business defamation, corporate governance, transportation, taxation, construction, land use, and intellectual property.