'Standards and Premises of Value'

Appraisers are frequently utilized to assist matrimonial courts in determining the value of property subject to equitable distribution within a marital estate. Interestingly, every appraisal should be provided with listed assumptions ' which may give rise to questions concerning the analysis pertaining to the standards and premises relied upon. Many state courts apply a “fair market value” standard, although often the interpretation and constructs of “fair market value” differ from state to state according to the prism of case law and statutory law. (One of the better treatments of varying interpretations is the book “Standards of Value ' Theory and Practice,” by Jay Fishman, Shannon Pratt, and William Morrison (2007).) One of the key assumptions in any appraisal is the presumption of a standard, or a foundation upon which to base judgments. A premise of value modifies the standard through definition of the expected use of the property being appraised. The matrimonial attorney should understand the variability that exists regarding these standards and premises, as well as review any nuances that an appraiser may use in defining value of the marital property. This is fertile ground for logic and reasoning, and can often expose the ill-prepared appraiser and undermine the conclusions presented. Alternatively, the attorney must be aware that his/her own selected appraiser may come under attack for a cavalier valuation analysis.