JURISDICTIONAL EXCEPTION RULE (AO-32)

The JURISDICTIONAL EXCEPTION RULE exempts appraisers from the part or parts of USPAP that are contrary to the law or regulation of a particular jurisdiction.  If part of USPAP is contrary to any applicable federal, state, or local law or regulation, only that part shall be of no force and effect in that assignment.  Appraisers using the JURISDICTIONAL EXCEPTION RULE must properly disclose the legal authority justifying the exemption of part or parts of USPAP that are contrary to law.

Use of the JURISDICTIONAL EXCEPTION RULE is triggered by a contradiction between the requirements of USPAP and the law or regulations of a jurisdiction, not by client or appraiser discretion.

USPAP does not establish who or which assignments must comply.  Therefore, the JURISDICTIONAL EXCEPTION RULE cannot be applied to the decision to comply with USPAP.

An individual’s identification as an appraiser is the basis for determining who should comply with USPAP.  This is because an individual’s public identification as an appraiser establishes an expectation that valuation services will be performed in compliance with USPAP.  An individual must comply with USPAP when required by law, regulation, or agreement.  Even if the governing authority’s policy does not require USPAP compliance, other applicable law or regulation might require compliance.