Professional License Restrictions Not A Bar To Expert Report, NC Sup. Ct.
Statutory restrictions on professional licenses do not necessarily apply to expert witness reports, the North Carolina Supreme Court has ruled in a decision reversing both the state Court of Appeals and the trial court.
In North Carolina Department of Transportation v. Mission Battleground Park, DST, No. 361PA16, 2018, NC, the owners of a 240-unit apartment building, Mission Battleground Park (MBP, brought suit against the state Department of Transportation (DOT), arguing that the $276,000 offered by DOT for condemning 2.193 acres of their land was not just compensation.
MBP sought to introduce the testimony of their Commercial Real Estate expert witness, James Collins. His report compared the fair market value of the entire tract just before the taking with what the fair market value of the remainder of the tract would be after the construction of the highway. Collins found the proper amount of compensation to be $3.734 million.
DOT moved to exclude Collin's expert witness report and testimony, based on North Carolina General Statutes §93A-83, which govern the practice of real estate agents, specifically the practice of providing broker price opinions and comparative market analyses. The trial court agreed with DOT, excluding Collin's report and testimony. MBP appealed to the state Court of Appeals, and losing there, moved to the state Supreme Court.
The North Carolina Supreme Court reviewed the statute which allows licensed brokers to provide estimates of the “probable selling price or leasing price” of real property, but prohibits them from providing estimates of the “value” of real property — a practice restricted to licensed or certified appraisers.
However, that prohibition, the Court pointed out, was made “under the authority” of that Article, something “both the trial court and the Court of Appeals seem to have overlooked.”
The authority of a broker (or of anyone else) to testify as an expert or prepare a report does not come from the statute, the state Supreme Court said. That authority comes from NC Rule of Evidence 702.
The state Supreme Court noted that under DOT's interpretation, the statute "would bar a licensed broker from testifying about fair market value simply because he holds a broker's license — even when an intelligent layperson, without any license, could potentially testify about fair market value.
The state Supreme Court quoted Antonin Scalia & Bryan A. Garner:
“Perhaps no interpretive fault is more common than the failure to follow the whole-text canon, which calls on the judicial interpreter to consider the entire text, in view of its structure and of the physical and logical relation of its many parts.
Antonin Scalia & Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 167 (2012).