In many lawsuits, the level of animosity between the parties involved is so high that it seems as if they would never be able to agree on anything. As a result, when disagreements between parties rise to the level that a lawsuit is filed, the likelihood of jointly retaining an appraiser may seem like a far-flung dream. The parties involved in these types of engagements, however, are often the ones that can benefit the most from the joint retention of a valuation expert (as opposed to each side hiring their own independent experts).
There are many benefits that can be realized from jointly retaining a valuation expert – a few of the most pertinent benefits are listed below:
Lower Fees – As the name implies, the costs for a jointly retained expert are normally borne jointly by the parties involved in the dispute. Therefore, each party is effectively receiving a 50% discount compared to what their expenses would have been had they hired their own independent appraisers. In addition to these savings, if the parties agree to be bound by the value determined by the joint expert, significant fees can be saved by avoiding the lengthy battle that can ensue arguing over which experts’ report is more “right” or more reliable. It is not uncommon for these costs to be significantly in excess of the cost of having the valuation report prepared.
Minimization of “Hired Gun” Image – Even if the valuation expert retained by a single party is offering a completely unbiased opinion, there may still be a perception that he or she is a “hired gun” for the retaining party. The use of a joint appraiser minimizes this perception (whether real or not) since it has more of an unbiased appearance by its very nature.
Quicker Resolution – Disagreements over valuations can significantly lengthen a lawsuit (which only increases fees, as discussed above). Therefore, not only does the joint retention of an appraiser reduce potential fees, but it can also bring the lawsuit to a conclusion more quickly and allow the parties to return to their normal responsibilities sooner than they might have otherwise.
As discussed above, even if the parties cannot agree on the issues that form the substance of a lawsuit, agreeing on the use of a joint appraiser can reduce the costs and headaches for everyone involved and help bring the disagreement to resolution sooner.
For more information on our Business Valuations Services, please leave a message below or call 440-449-6800.