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Apr 18

Texas Supreme Court Clarifies Rule That Allows a Property Owner to Testify About the Value of His or Her Property

by Greg Enos

It has long been the rule in Texas that the owner of a property can testify as to the property’s value even if the homeowner cannot qualify as an expert witness. Mata v. Mata, 710 S.W.2d 745, 758 (Tex. App.— Corpus Christi 1986, no writ). The Texas Supreme Court in December 2012 limited that rule and held that the property owner must explain the basis for his or her opinion as to value.

Natural Gas Pipeline Co. of America v. Justiss, __ S.W.3d __ (Tex.12/14/2012 – 10-0451), was a nuisance suit for damages, not a divorce. However, the rule articulated by the Texas Supreme Court should apply in divorce cases when a spouse testifies what the family house or a car or a business or the personal property is worth. In such a situation, the spouse must also explain what that opinion is based on.

The Supreme Court stated:

Because property owner testimony is the functional equivalent of expert testimony, it must be judged by the same standards. Thus, as with expert testimony, property valuations may not be based solely on a property owner’s ipse dixit.* An owner may not simply echo the phrase “market value” and state a number to substantiate his diminished value claim; he must provide the factual basis on which his opinion rests. This burden is not onerous, particularly in light of the resources available today. Evidence of price paid, nearby sales, tax valuations, appraisals, online resources, and any other relevant factors may be offered to support the claim. But the valuation must be substantiated; a naked assertion of “market value” is not enough. Of course, the owner’s testimony may be challenged on cross-examination or refuted with independent evidence. But even if unchallenged, the testimony must support a verdict, and conclusory or speculative statements do not.

Thus, the spouse who testifies his house is worth $200,000 should be asked what that opinion is based on and he should say he checked with several real estate agents, compared his house to homes that recently sold in the neighborhood and consulted two on-line Internet services that provide house values (for example). The spouse cannot simply just say his house is worth $200,000 without an explanation.

* For those who do not speak Latin, Ipse dixit means “he, himself, said it,” and is also known as the bare assertion fallacy. It is a term which is used to identify and describe a sort of arbitrary dogmatic statement which the speaker expects the listener to accept as valid

Category:Property Division | Tags: divorce, valuation

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