Expert Opinions in California Real Estate Cases – Does the Expert Need to Personally Know the Matter That is the Basis for The Opinion?

Expert opinions are occasionally relied on in California real estate disputes. Experts may be hired initially to determine if there are grounds for a lawsuit. In ongoing litigation, an expert may be hired to offer an opinion to establish damages, or to serve as a witness at trial as to the other party’s breach of a duty, or to counter an expert identified by the opposing party. Experts are usually hired by Sacramento real estate attorneys, rather than their clients, so that the expert’s report is protected by the attorney privilege.

Some examples of expert opinion in real estate cases –

Valuation of property – it must be based on matter perceived by the expert or made known to the witness before the hearing, that is of the type reasonably may be relied upon by an expert in determining the value of property. (Evidence Code section 814)

Construction defect – review and evaluation of the specifications and plans, materials that were used, and degree of care and skill used by the contractor are usually required and undertaken by experts.

Broker and Agent Negligence – expert testimony is admissible regarding the breach of the duty of care, including testimony as to custom and practice. However, such testimony is not admitted to establish whether there is a duty in the first place.

In a decision out of Southern California, a peculiar set of facts resulted in an opinion that clearly sets out what is required for an expert opinion to be admissible. In Bell v. Mason, apparently Bell forged a deed from an elderly godparent. She borrowed as much as she could against the property, which had been free and clear of liens, and then she sold it Mason. The godfather died, and his estate sued Bell. They settled, agreeing that Bell would sue Mason, and would share any recovery with the godparent. Bell sued, claiming that she was mentally retarded. At trial, Bell presented Scarf as an expert witness, who testified that she had an IQ of 62.

The defendants presented a psychiatrist as an expert witness, who testified that he had read Scarf’s trial testimony in its entirety and reviewed the records that Scarf produced which Scarf testified were the basis for her opinion. In addition, Black read all three volumes of Bell’s deposition testimony and viewed in excess of 15 hours of her videotaped deposition testimony. The trial court judge ruled that his testimony was not admissible as he had not personally evaluated Bell.

The court of appeal said that this is wrong – his opinion was based on matter made known to him at or before the hearing, and is of a type that reasonably may be relied upon by an expert on this subject. This is all that Evidence Code section 801 requires (set out below) Here, the trial judge shot from the hip and apparently did not closely at the Evidence Code, which resulted in his eviscerating the defense case. The judge was wrong.

Evidence Code section 801
If a witness is testifying as an expert, his testimony in the form of an opinion is limited to such an opinion as is:
(a) Related to a subject that is sufficiently beyond common experience that the opinion of an expert would assist the trier of fact; and
(b) Based on matter (including his special knowledge, skill, experience, training, and education) perceived by or personally known to the witness or made known to him at or before the hearing, whether or not admissible, that is of a type that reasonably may be relied upon by an expert in forming an opinion upon the subject to which his testimony relates, unless an expert is precluded by law from using such matter as a basis for his opinion.