Kuehn v. Stanley also involved the buyer suing an appraiser for mistakes allegedly made in an appraisal made in connection with the purchase of real property and the funding of a mortgage for the property. The appraiser was employed by CRG, a division of First Magnus, the lender in the transaction.

In upholding summary judgment for the appraiser, Division 2 of the Arizona Court of Appeals held that the mortgage lender had no duty to the buyers and that they could not prove that they justifiably relied upon the appraisal in any event.

Specifically, the Court ruled that the mortgage lender lacked any duty to the buyers in connection with the appraisal. The Court held that the appraiser “did not provide the appraisal ‘for the guidance’ of the buyers as the [law] requires” and that the Kuehns were not part of the ” ‘limited group of persons’ protected.

The Court further explained that the buyers could not have justifiably relied upon the appraisal report because they did not hire the appraiser, because the “loan application specifically stated that First Magnus made no representation about the value of the property,” and because the appraisal report indicated it was for use by the lender only. More important, the Court ruled that “the [buyers] were already contractually bound to purchase the property, contingent upon qualifying for funding, before they received the appraisal.” Id. There was no showing that the Kuehns had received the report, much less reviewed it, or that they had any right to cancel when they received it.