Appraisers, Experts and Other Professionals Can be Held Liable for Fraud Based Upon Opinions With “Flimsy Grounds”

There is a well-established principle that statements of “opinion” are distinct from representations of fact for purposes of establishing the elements of a claim for civil fraud. It is based upon the general premise that a representation must be proven to be true or false factually, and an opinion is merely a subjective expression that cannot be found to be either “true” or “false.”

As explained in Rubin v Sabharwal, 171 AD3d 580 (1^st Dep’t 2019), courts often characterize statements about the value of an item to be “nonactionable opinion”: “The alleged misrepresentations—that the items were of ‘museum quality,’ of ‘highest quality,’ and ‘generational’—ultimately go to the value of the jewelry, which constitutes ‘“nonactionable opinion that provide[s] no basis for a fraud claim’” (MAFG Art Fund, LLC v Gagosian, 123 AD3d 458, 459 [1st Dept 2014], lv denied 25 NY3d 901 [2015]; see also Augsbury v Adams, 135 AD2d 941, 942 [3d Dept 1987]).”

For some more background on these principles, see my posts, “Court Distinguishes Nonactionable ‘Puffery’ and ‘Hyperbole’ From Concrete Factual Misrepresentations of Fraud;” “SDNY Dismisses Fraud Claims in Context of Promised Employment Opportunities.”

These principles have particular relevance to potential claims regarding professional opinions relating to the value of real property and the purchase of real property. See,e.g., “First Department Reinstates Fraud Claims Against Attorney for Alleged False Opinion Letter to Non-Client Lender.”

The new decision by the New York Appellate Division, First Department, in RSD857, LLC v Wright, 2025 NY Slip Op 06833 (1^st Dep’t Decided Dec. 9, 2025) explains the circumstances under which an appraiser, or for that matter, any expert, can actually be held liable under a fraud cause of action for its opinion.

Read the full blog post here.