A state law requires appraisers to use a specific format that conflicts with USPAP reporting requirements. In this situation, the appraiser should:
Correct Answer
A) Invoke a jurisdictional exception and follow the law
Why this is correct: USPAP's Jurisdictional Exception (Lines 901-903) states that if a law or regulation conflicts with USPAP, the appraiser must comply with the law and disclose the conflict in the report. This exception prevents appraisers from violating the law. Why the other choices are wrong: 'Follow USPAP and disregard the state law' would violate the law. 'Use whichever of the two proves less restrictive' is not the rule; compliance with law is mandatory. 'Decline every assignment within that state' is unnecessary; the jurisdictional exception provides a solution. Exam tip: Law conflicts with USPAP? Invoke jurisdictional exception, follow the law, and disclose.
Why This Is the Correct Answer
Option B correctly identifies the proper use of a jurisdictional exception under USPAP Standards Rule 2-2(a)(viii) and other applicable sections. When law or regulation conflicts with USPAP, appraisers are permitted and expected to comply with the legal requirement while invoking a jurisdictional exception. The appraiser must clearly identify and explain the parts of USPAP that are set aside and cite the law or regulation that necessitated the exception. This approach maintains legal compliance while preserving professional integrity through proper disclosure.
Why the Other Options Are Wrong
JEL Method
JEL = Jurisdictional Exception for Law. When law conflicts with USPAP, invoke a Jurisdictional Exception and follow the Law while disclosing the deviation.
How to use: When you see a question about conflicts between USPAP and legal requirements, think 'JEL' - the answer will involve using a jurisdictional exception to comply with the law while properly disclosing the USPAP deviation.
Exam Tip
Look for keywords like 'state law requires,' 'regulation mandates,' or 'legal requirement' combined with 'conflicts with USPAP' - these signal jurisdictional exception questions where compliance with law takes precedence.
Common Mistakes to Avoid
- -Thinking USPAP always takes precedence over state law
- -Believing jurisdictional exceptions allow appraisers to ignore USPAP entirely
- -Failing to properly disclose and explain the jurisdictional exception in the report
Concept Deep Dive
Analysis
This question tests understanding of jurisdictional exceptions under USPAP, which is a critical concept for appraisers working across different states with varying legal requirements. USPAP recognizes that appraisers must comply with applicable laws and regulations, even when they conflict with USPAP standards. The jurisdictional exception provision allows appraisers to deviate from USPAP requirements when law or regulation requires it, but mandates proper disclosure of the deviation. This balances professional standards with legal compliance requirements that appraisers face in practice.
Background Knowledge
USPAP provides for jurisdictional exceptions when law or regulation conflicts with USPAP requirements, allowing appraisers to comply with legal mandates while maintaining professional standards through proper disclosure. The appraiser must identify the specific USPAP requirement being set aside and cite the conflicting law or regulation in their report.
Real-World Application
In practice, appraisers frequently encounter state-specific reporting formats for tax assessment appeals, eminent domain cases, or regulatory filings that may not align perfectly with USPAP report formats, requiring proper use of jurisdictional exceptions to maintain both legal compliance and professional standards.
More USPAP Questions
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According to the Competency Rule, if an appraiser lacks the knowledge and experience to complete an assignment competently, which action is NOT acceptable?
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A client-imposed requirement — 'use only comps from our approved list' — is best described as:
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The certification required by Standards Rule 2-3 must be signed by:
According to Standard 1, when developing an opinion of market value, an appraiser must analyze:
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