Ask an Instructor: New Definitions for Limiting Conditions and Extraordinary Assumptions
Tuesday, January 26, 2021 in Ask an Instructor
Question: Has ISA issued any new definitions for Limiting Conditions and Extraordinary Assumptions as yet?
ISA recommends that the definition for extraordinary assumptions to use in your appraisal reports should be the same as the definition provided in the current 2020-2021 edition of USPAP. The definition in the 2020 Core Course manual is taken directly from this source. USPAP does not currently define limiting conditions. As such, ISA is currently conducting further research for a definition to use. In the meantime, the Connecticut Superior Court case, Renewal Capital, LLC v. Joshua Martin, et al., Superior Court, Judicial District of Hartford at Hartford, Docket No. HHD-CV18-6088271-S, addressed the use of limiting conditions, and we can use this case as a guideline for a definition until further case law occurs. Thus, for your reports, you can use the following definition: Limiting Conditions limit the appraiser’s liability and limit the scope of the appraiser’s responsibilities in an appraisal assignment.
For more information on this topic, see Tim Luke’s blog post.