                         IN THE
          ARIZONA COURT OF APPEALS
                      DIVISION TWO


      SOUTHWEST NON-PROFIT HOUSING CORPORATION,
         AN ARIZONA NON-PROFIT CORPORATION,
                  Plaintiff/Appellant,

                            v.

                   JAMES E. NOWAK, II,
                    Defendant/Appellee.


      SOUTHWEST NON-PROFIT HOUSING CORPORATION,
         AN ARIZONA NON-PROFIT CORPORATION,
                  Plaintiff/Appellant,

                            v.

KATHLEEN KNIFFEN, DBA KATHLEEN KNIFFEN APPRAISAL SERVICE,
                    Defendant/Appellee.


      SOUTHWEST NON-PROFIT HOUSING CORPORATION,
          AN ARIZONA NON-PROFIT CORPORATION,
                   Plaintiff/Appellant,

                            v.

    JOHN T. MARTELL, DBA JOHN T. MARTELL & ASSOCIATES,
                     Defendant/Appellee.


      Nos. 2 CA-CV 2013-0069, 2 CA-CV 2013-0097, and
              2 CA-CV 2013-0098 (Consolidated)
                    Filed March 31, 2014
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                          Opinion of the Court


           Appeal from the Superior Court in Pima County
            Nos. C20125381, C20124584, and C20124585
                The Honorable Gus Aragón, Judge
                The Honorable Leslie Miller, Judge

                                  AFFIRMED


                                  COUNSEL

William E. Druke, Tucson

and

Quinn Law, PLLC
By Ian D. Quinn, Phoenix
Counsel for Plaintiff/Appellant

Snell & Wilmer, L.L.P.
By Jeffrey Willis and Katherine V. Foss, Tucson
and Mary-Christine Sungaila, Pro Hac Vice, Costa Mesa, California
Counsel for Defendant/Appellee Nowak

Gust Rosenfeld, P.L.C.
By Mark L. Collins and Robert M. Savage, Tucson
Counsel for Defendants/Appellees Kniffen and Martell



                                  OPINION

Judge Espinosa authored the opinion of the Court, in which
Presiding Judge Kelly and Judge Eckerstrom concurred.




                                     2
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                          Opinion of the Court

E S P I N O S A, Judge:

¶1          In consolidated cases, Appellant Southwest Non-Profit
Housing Corporation (Southwest) appeals trial court decisions in
favor of three defendant appraisers, James E. Nowak II (Nowak),
Kathleen Kniffen (Kniffen), and John T. Martell (Martell), whom
Southwest alleged had conducted appraisals negligently, resulting
in lost home sales for Southwest. For the following reasons, we
affirm.

                 Factual and Procedural Background

¶2           These cases arise from appraisals performed in
connection with sales of residential properties. In each case the sale
was subject to the property appraising for the contracted sale
amount. In all three cases, the appraisals were appreciably lower
than the properties’ contracted sale prices. As a result, the lender
refused to lend the amounts the buyers requested for purchase, and
the buyers ultimately canceled the sales.

¶3           The seller, Southwest, filed separate complaints against
the three appraisers, asserting each had been negligent in
performing his or her respective appraisal. Nowak responded to the
complaint with a motion to dismiss, and Kniffen and Martell filed
motions for summary judgment. All three relied on § 552 of the
Restatement (Second) of Torts (1977) (hereinafter Restatement) in
denying any liability for negligent misrepresentation. The three
motions were granted, and Southwest appealed. The cases were
consolidated in this court on Southwest’s motion. We have
jurisdiction pursuant to A.R.S. §§ 12-120.21(A)(1) and 12-2101(A)(1).

                           Nowak Appraisal

¶4           In reviewing a trial court’s decision to grant a motion to
dismiss, we assume the truth of the facts asserted in the complaint.
Airfreight Exp. Ltd. v. Evergreen Air Ctr., Inc., 215 Ariz. 103, ¶ 2, 158
P.3d 232, 235 (App. 2007). Southwest purchased a residence on
Desert Aire Drive in Tucson, invested $8,000 in rehabilitating the
property, and then listed it for sale. Southwest received three offers
for the property and accepted the highest one for $94,000.


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  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                        Opinion of the Court

Southwest then entered into a sales contract with the prospective
buyer, who applied for a loan to purchase the property. The lender
required an appraisal to underwrite the loan and retained Nowak as
the appraiser. Nowak appraised the property’s value in June 2012 at
$81,000. The lender then refused to fund the loan in the amount
requested, and the prospective buyer withdrew from the contract.

¶5           Southwest thereafter filed a complaint against Nowak
alleging negligent performance of the appraisal. Southwest asserted
that Nowak had “breached his duty to all parties to the transaction”
thus “caus[ing] the lender to decline to underwrite the loan and
effectively cancel[] the sale.” Nowak responded with a motion to
dismiss, arguing he could not be liable for negligence under § 552 of
the Restatement. The trial court granted the motion, ruling as a
matter of law that the appraiser had no duty to Southwest.
Southwest filed a motion for reconsideration, which the court
denied.

                   Kniffen and Martell Appraisals1

¶6          In reviewing a trial court’s decision to grant summary
judgment we view “the evidence and all reasonable inferences
therefrom in the light most favorable to the party against whom
summary judgment was granted.” Airfreight Exp. Ltd., 215 Ariz. 103,
¶ 2, 158 P.3d at 235. The parties largely agree on the facts
underlying these appraisals but dispute their legal effect. In 2012,
Southwest entered into a contract to sell a residence on Bayberry
Street in Tucson for $170,000, contingent on the buyers obtaining
loan approval supported by an appraisal of the property for at least




      1 Although    the actions involving Kniffen and Martell were
litigated separately below, we consider them together, as the facts in
each case are similar and the filings by the parties and decisions by
the court are substantially alike. When there are differences relevant
to this decision, the two cases are discussed separately.


                                  4
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

the purchase price. 2 The lender engaged Kniffen to appraise the
property, and she estimated its fair market value as $150,000.
Because the appraisal contingency was not satisfied, the prospective
buyers attempted to renegotiate the contract. Southwest would not
agree to a new contract, and the buyers withdrew from the
purchase.

¶7          In a similar transaction, Southwest contracted to sell a
residence located on Harvester Drive to a prospective buyer for
$141,000. Again, the buyer’s obligations were contingent upon the
property appraising for at least the purchase price. The lender
engaged Martell to appraise the Harvester Drive property, and his
report appraised its fair market value at $127,000. The prospective
buyer consequently exercised his right to cancel the contract.

¶8          Southwest brought actions against Kniffen and Martell
alleging negligence relating to the appraisals. Both defendants
moved for summary judgment, asserting Southwest was not the
“intended user of the appraisal[s] and, in any event, took no acts in
reliance thereon.” Citing the appraisal certification, Southwest
responded that the appraisers knew that “secondary market
participants—parties other than the stated intended users—would
be supplied [their] appraisal report[s]” and “so long as a party was
provided the appraisal report with [the appraisers’] knowledge[,]
they are entitled to rely on the same.” The trial court entered
summary judgment in favor of Kniffen and Martell.


      2The   appraisal contingency portion of the agreement states:

              Buyer’s obligation to complete this sale is
              contingent upon an appraisal of the
              premises acceptable to lender for at least
              the purchase price. If the Premises fails to
              appraise for the purchase price in any
              appraisal required by lender, Buyer has
              five (5) days after notice of the appraised
              value to cancel this Contract and receive a
              refund of the Earnest Money or the
              appraisal contingency shall be waived.


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  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

                              Discussion

   A. Nowak’s Motion to Dismiss

¶9           Southwest asserts the trial court committed reversible
error in dismissing its complaint “on the sole ground that Southwest
had executed the sales agreement ‘before the appraisal was
commissioned,’” observing that § 552 of the Restatement imposes
liability “when the provider of professional information knows the
specific transaction or type of transaction involved and intends to
guide and benefit those involved in the transaction.”

¶10           We review dismissal of a complaint under Rule 12(b)(6),
Ariz. R. Civ. P., de novo. Coleman v. City of Mesa, 230 Ariz. 352, ¶ 7,
284 P.3d 863, 866 (2012). In doing so, we look only to the complaint,
assuming the truth of all well-pled factual allegations and indulging
all reasonable inferences. Cullen v. Auto-Owners Ins. Co., 218 Ariz.
417, ¶ 7, 189 P.3d 344, 346 (2008). Although we “uphold dismissal
only if the plaintiffs would not be entitled to relief under any facts
susceptible of proof in the statement of the claim,” Mohave Disposal,
Inc. v. City of Kingman, 186 Ariz. 343, 346, 922 P.2d 308, 311 (1996),
we may affirm if the dismissal is correct for any reason, Dube v.
Likins, 216 Ariz. 406, n.3, 167 P.3d 93, 104 n.3 (App. 2007). Moreover,
“we do not accept as true allegations consisting of conclusions of
law, inferences or deductions that are not necessarily implied by
well-pleaded facts, unreasonable inferences or unsupported
conclusions from such facts, or legal conclusions alleged as facts.”
Jeter v. Mayo Clinic Ariz., 211 Ariz. 386, ¶ 4, 121 P.3d 1256, 1259 (App.
2005).

¶11         To state a claim for relief for negligent
misrepresentation, including those presented here—that the
defendants were negligent in their appraisals—a plaintiff must
allege, among other elements, that he was owed a duty of care by
the defendant. See Belen Loan Investors, LLC v. Bradley, 231 Ariz. 448,
¶ 8, 296 P.3d 984, 989 (App. 2012). We address de novo the purely
legal issue of whether the trial court correctly ruled that Nowak
owed Southwest no such duty as a matter of law. Id.




                                   6
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                        Opinion of the Court

¶12           To determine the scope of an appraiser’s obligations to
third parties we look to Restatement § 552. See Belen Loan Investors,
LLC, 231 Ariz. 448, ¶ 10, 296 P.3d at 989. An appraiser has liability
for losses suffered “by the person or one of a limited group of
persons for whose benefit and guidance he intends to supply the
information or knows that the recipient intends to supply it.” This
liability is limited to those transactions “that he intends the
information to influence or knows that the recipient so intends.”
Restatement § 552(2). The appraiser need not know the specific
identity of the third-party recipient when the information is
supplied, so long as the appraisal is intended to reach and influence
a particular type of individual or class of persons.

¶13           Section 552, however, does not open liability to an
unlimited class of individuals who are merely “foreseeable.” The
appraiser is not liable to all whom “might reasonably be expected
sooner or later to have access to the information and foreseeably to
take some action in reliance upon it.” Restatement § 552 cmt. h; see
also Sage v. Blagg Appraisal Co., 221 Ariz. 33, n.7, 209 P.3d 169, 174
n.7 (App. 2009) (foreseeability ordinarily creates no duty of care).
As the Restatement observes, the “risk of liability to which the
supplier subjects himself by undertaking to give the information . . .
is vitally affected by the number and character of the persons, and
particularly the nature and extent of the proposed transaction.”
Restatement § 552 cmt. h. This court also has noted “there are good
reasons to conclude that a professional who provides information
should not owe a duty of care to anyone who happens to receive the
information.” Sage, 221 Ariz. 33, n.9, 209 P.3d 175 n.9.

¶14          In its complaint, Southwest stated that Nowak “owe[d]
a particular duty of care in performing h[is] professional duties.” It
asserted that by “agreeing to complete the Appraisal[,] Nowak
attained a duty to the lender and the borrower for whom the
Appraisal was to benefit,” and that “by failing to properly utilize
data readily available to him . . . Nowak breached his duty to all
parties of the transaction.” And finally, Southwest maintains that
“[b]y breaching his duty, Nowak caused the lender to decline to
underwrite the loan and effectively cancelled the sale of the
Property.”


                                  7
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

¶15           The trial court found that under the facts pled, and the
requirements of § 552, Nowak owed no duty to Southwest. The
court noted § 552 required Southwest to show that it was “part of a
limited group of persons or entities specifically intended to be
benefitted or guided by the appraiser” and that the “appraiser
intend[ed] to supply his appraisal to the seller or kn[ew] that the
lender, as the intended recipient of the appraisal, intend[ed] to
supply it to the seller.” It also noted the requirement that “the
appraiser intended that the appraisal information would influence
the seller, or [knew] that the lender intend[ed] to use the appraisal to
influence the seller.” Expressly “[l]ooking at the language in
Plaintiff’s Complaint,” the court found it “clear that the sales
agreement had been made before the appraisal was commissioned,”
and thus found “no reason to believe that the appraiser intended to
influence the sale.”

¶16          Southwest asserts the trial court’s holding “put[] the
proverbial ‘cart before the horse’ by requiring an appraisal before
the sales agreement is signed.” According to Southwest, “Nowak
could only become ‘manifestly aware’ of the appraisal’s purpose
after Southwest signed the agreement,” and contends that “Nowak’s
duty of care arose only after, not before, the sales agreement was
executed.” Southwest’s complaint, however, is devoid of support
for the claim that Nowak intended at any point to influence
Southwest, thereby assuming a duty of care to it.3


      3 Southwest   did assert generally that “Nowak breached his
duty to all parties of the transaction.” However, as a conclusion of
law not necessarily implied by the facts pled, we need not accept the
assertion as true. Cullen, 218 Ariz. at 419, 189 P.3d at 346 (“mere
conclusory statements are insufficient to state a claim upon which
relief can be granted”); Jeter, 211 Ariz. 386, ¶ 4, 121 P.3d at 1259 (“we
do not accept as true allegations consisting of conclusions of law . . .
not necessarily implied by well-pleaded facts . . . or legal conclusions
alleged as facts”). Further, Nowak’s duty is described in the
complaint as arising at the time he agreed to perform the appraisal
and that duty was to “the lender and the borrower for whom the
Appraisal was to benefit.”


                                   8
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                        Opinion of the Court

¶17          In applying § 552, “[i]ntent to influence is a threshold
issue.” Bily v. Arthur Young & Co., 834 P.2d 745, 771 (Cal. 1992); see
Restatement § 552, cmt. j. (“the liability of the maker of a negligent
misrepresentation is limited to the transaction that he intends, or
knows that the recipient intends, to influence, or to a substantially
similar transaction”). Under the facts as pled, it is undisputed that
Southwest’s contract with its buyer preceded the appraisal and that
the appraisal was performed for the lender. As such, the trial court
could not reasonably find that Nowak had intended to influence
Southwest, which had already committed to the sale price. 4 See
Wingate Land, LLC v. ValueFirst, Inc., 722 S.E.2d 868, 870 (Ga. Ct.
App. 2012) (no attempt to induce seller of property to rely where
appraiser performed appraisal for lender after seller and buyer
entered into sales contracts for previously agreed upon prices). 5

      4In  its reply brief, Southwest argues it was not contractually
bound at the time it executed the sales agreement because of the
appraisal contingency. However, that provision, apparently the
same as in Kniffen’s and Martell’s cases and quoted above, protects
buyers by allowing them to cancel the contract if the appraisal is
lower than the contract price. It provides no such cancellation rights
to the seller. Compare Sage, 221 Ariz. 33, ¶¶ 2-3, 24, 209 P.3d at 170,
175 (appraiser owed duty of care to homebuyer where buyer paid
for appraisal, had right to appraisal, and contract allowed buyer to
forego sale if appraisal unfavorable). While it might be foreseeable
that buyers exercising their rights pursuant to this provision would
show an appraisal to the seller, foreseeability alone has been deemed
insufficient to create a duty on the part of the information provider.
See Restatement § 552 cmt. h; Sage, 221 Ariz. 33, n.7, 209 P.3d at 174
n.7; Hoffman v. Greenberg, 159 Ariz. 377, 379, 767 P.2d 725, 727 (App.
1988).
      5 Southwest   relies heavily on a Washington case, Schaaf v.
Highfield, for the proposition that liability under § 552(2)(a) extends
“to those involved in the transaction that triggered the appraisal
report, including, but not necessarily limited to, the buyer and the
seller.” 896 P.2d 665, 670 (Wash. 1995). However, the language in
Schaaf relating to an appraiser’s duty to a “seller” was mere dicta, as
the case involved an appraiser’s duty to a buyer.


                                  9
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

Because no reasonable interpretation of the facts alleged allows for a
finding that Nowak intended to influence Southwest, see Cullen, 218
Ariz. 417, ¶ 14, 189 P.3d at 347 (courts consider only well-pled facts
and reasonable interpretations of those facts), dismissal was
warranted, see Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th
Cir. 1988) (dismissal proper under Fed. R. Civ. P. 12(b)(6) when
complaint fails to allege sufficient facts to support legal claim),
abrogated on other grounds by Bell Atl. Corp. v. Twombly, 530 U.S. 544
(2007); see also Waltner v. JPMorgan Chase Bank, N.A., 231 Ariz. 484, ¶
18, 297 P.3d 176, 180 (App. 2013) (applying Fed. R. Civ. P. 12(b)(6)
analysis to Ariz. R. Civ. P. 12(b)(6)).

¶18          Southwest also contends there is a factual issue to be
determined, specifically, “who Nowak intended his appraisal to
benefit and guide in the transaction.” Again, however, nowhere in
its complaint does Southwest assert that Nowak intended to benefit
and guide it by his appraisal. Rather, the complaint states “[i]n
agreeing to complete the Appraisal[,] Nowak attained a duty to the
lender and the borrower for whom the Appraisal was to benefit.” In
considering a motion to dismiss, we are limited to well-pled facts
and cannot speculate about hypothetical ones that might entitle a
party to relief, Cullen, 218 Ariz. 417, ¶ 14, 189 P.3d at 347, and the
trial court could properly decline to hypothesize about Nowak’s
intentions notwithstanding Southwest’s efforts to articulate its claim.
The complaint against Nowak was properly dismissed as a matter of
law.

   B. Kniffen and Martell’s Motions for Summary Judgment

¶19          When a party appeals a summary judgment decision,
our review is de novo to determine whether the trial court correctly
applied the law. Tenet Healthsystem TGH, Inc. v. Silver, 203 Ariz. 217,
¶ 5, 52 P.3d 786, 788 (App. 2002). We also review de novo issues of
contract interpretation. Id.

¶20          In its ruling on the motion for summary judgment, the
trial court rejected Southwest’s argument that it was owed a duty
because its real estate broker was a “secondary market participant”
under paragraph twenty-one of the appraiser’s certification. That
paragraph identifies the parties to whom the “lender/client may


                                   10
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

disclose or distribute this appraisal report” without having to obtain
the appraiser’s consent, 6 and does not include the “seller.”
Southwest argued that its broker’s implied inclusion on this list of
permissible recipients made it an intended recipient as well and
created a duty to Southwest on the part of Kniffen and Martell.

¶21           On appeal, Southwest no longer advances its
“secondary market participant” argument, but instead contends the
court erred in effectively concluding Southwest had waived Kniffen
and Martell’s tort liability to it based on the fact that paragraph
twenty-one did not include the term “seller” in the list of those
intended to receive the appraiser’s report. Southwest argues, “the
omission of [the term] ‘seller’ from paragraph 21 in the[] Appraiser’s
Certifications raises a genuine issue of material fact as to whether
Southwest waived its tort liability against the appraisers and
precludes summary judgment.” Southwest further argues that
“[f]ederal law charges an appraiser with knowledge that the
recipient of an appraisal, such as a lender, must supply the appraisal

      6Paragraph   twenty-one states in relevant part:

            The lender/client may disclose or
            distribute this appraisal report to: the
            borrower; another lender at the request of
            the borrower; the mortgagee or its
            successors and assigns; mortgage insurers;
            government sponsored enterprises; other
            secondary market participants; data
            collection    or     reporting       services;
            professional appraisal organizations; any
            department, agency, or instrumentality of
            the United States; and any state, the District
            of Columbia, or other jurisdictions; without
            having to obtain the appraiser’s or
            supervisory appraiser’s (if applicable)
            consent. Such consent must be obtained
            before this appraisal report may be
            disclosed or distributed to any other
            party . . . .


                                  11
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

to a person with an interest in the real estate transaction, such as the
seller.”7

¶22          Southwest asserts that paragraph twenty-one of the
Appraiser’s Certifications for Kniffen and Martell constitutes a
waiver of tort liability, which contravenes public policy unless the
waiver was freely and fairly made. Southwest maintains that
because “it did not waive its tort remedies against Martell and
Kniffen,” any such waiver was not “knowingly bargained for,” and
“[w]ithout such evidence, a genuine issue of material fact exists as to
whether the omission of the term ‘seller’ from paragraph 21
constitutes a waiver of Southwest’s tort claims against Martell and
Kniffen and precludes summary judgment.”8


      7Neither  of these arguments was made to the trial court and,
as urged by Kniffen and Martell, may be considered waived. See
Odom v. Farmers Ins. Co. of Ariz., 216 Ariz. 530, ¶ 18, 169 P.3d 120, 125
(App. 2007) (“Generally, arguments raised for the first time on
appeal are untimely and deemed waived.”). But, as Southwest
observes, the waiver rule is one of procedure not jurisdiction, id.,
and is subject to our discretion. Such discretion may be properly
exercised when “the facts are fully developed, undisputed, and the
issue can be resolved as a matter of law” or when the question is one
of statewide public importance. State ex rel. Horne v. Campos, 226
Ariz. 424, n.5, 250 P.3d 201, 205 n.5 (App. 2011); see also Stokes v.
Stokes, 143 Ariz. 590, 592, 694 P.2d 1204, 1206 (App. 1984). We do so
here where Kniffen and Martell addressed the new arguments in
their response, the facts are undisputed, and the issues may be
resolved as a matter of law.
      8 At oral argument, Kniffen and Martell observed that
Appraisal Certification paragraph twenty-one identifies those who
may receive copies of the appraisals without obtaining the
appraiser’s consent and pointed out that paragraph twenty-three
limits who can rely on the appraisals. That paragraph states: “The
borrower, another lender at the request of the borrower, the
mortgagee or its successors and assigns, mortgage insurers,
government sponsored enterprises, and other secondary market
participants may rely on this appraisal report as part of any

                                   12
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

¶23          The appraisal engagements, however, were solely
between the appraiser and the lender/client. Southwest was not a
party to the agreement or the intended user of the appraisal. A
waiver is an intentional and voluntary relinquishment of a known
right. Am. Cont’l Life Ins. Co. v. Ranier Constr. Co., 125 Ariz. 53, 55,
607 P.2d 372, 374 (1980). Southwest simply had not acquired a right
that it might have waived. Cf. Restatement (Second) of Contracts
§ 315 (1981) (incidental beneficiary acquires by virtue of promise no
right against promisor or promisee).

¶24          Restatement § 552 provides that a negligent supplier of
misinformation is liable “only to those persons for whose benefit
and guidance it is supplied.” Restatement § 552 cmt. h. The maker
of the representation may be liable when he intends the
representation:

             to reach and influence either a particular
             person or persons, known to him, or a
             group or class of persons, distinct from the
             much larger class who might reasonably be
             expected sooner or later to have access to
             the information and foreseeably to take
             some action in reliance upon it.

 Id. The language of paragraph twenty-one evidences Kniffen’s and
Martell’s intent to limit the distribution of the appraisals to
particular classes of people, none of which included the seller of the
property. Southwest was thus part of the “much larger class” who
sooner or later might have access to the information and foreseeably
rely on it. Id. As such, Kniffen and Martell did not owe Southwest
any duty and summary judgment was appropriate. See Kuehn v.
Stanley, 208 Ariz. 124, ¶ 15, 91 P.3d 346, 351 (App. 2004).



mortgage finance transaction that involves any one or more of these
parties.” Because Southwest specifically cited paragraph twenty-
one in its brief and the analysis remains the same under both
paragraphs, as neither references a “seller,” we limit our discussion
to paragraph twenty-one.


                                  13
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

¶25          Southwest alternatively argues that a recent federal law,
the Dodd-Frank Act, caused Kniffen and Martell to “know” that
Southwest would receive their appraisals. Southwest points to
15 U.S.C. § 1639e which sets out requirements for independent
appraisals. Generally, the statute forbids “a person with an interest
in the underlying transaction” from attempting to influence the
appraised value assigned. 15 U.S.C. § 1639e(b). Exempted from this
prohibition, however, are enumerated parties including “any other
person with an interest in a real estate transaction” who requests
that an appraiser (1) consider additional appropriate property
information; (2) provide further detail for the appraiser’s value
conclusion; and (3) correct errors in the appraisal report. 15 U.S.C.
§ 1639e(c). Citing this provision, Southwest argues “[t]he Act thus
charges an appraiser with the knowledge that a seller will receive
the appraisal when a dwelling secures the buyer’s credit.”

¶26         Kniffen and Martell respond that nothing in the
statutory language of 15 U.S.C. § 1639e requires disclosure of an
appraisal to a seller under the facts at issue here. We agree. The
federal provision allows a variety of parties with an interest in a real
estate transaction to request that an appraiser consider more
information, provide further detail and correct any errors. It does
not, however, impose any affirmative requirements regarding the
distribution of appraisals or duties owed to third parties.
Accordingly, Southwest’s claim that § 1639e provides a basis for
imputing knowledge to Kniffen and Martell is unpersuasive.

   C. Reliance

¶27          Finally, assuming arguendo that some duty was
nevertheless owed to Southwest by Kniffen and Martell, we address
Southwest’s argument that the trial court erred by determining as a
matter of law that Southwest did not rely on their appraisals.
Southwest observes that Restatement § 552 subjects a provider of
professional information to liability “for pecuniary loss caused to
others by their justifiable reliance upon the information,” and cites at
length our supreme court’s guidance in St. Joseph’s Hospital &
Medical Center v. Reserve Life Insurance Co., relating to whether a
misrepresentation is material for purposes of showing that reliance
was justifiable. 154 Ariz. 307, 316, 742 P.2d 808, 817 (1987).


                                  14
  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                         Opinion of the Court

¶28           Before justifiable reliance can be found, however, there
must be some evidence in the record of reliance. Southwest is a
corporation in the business of purchasing, rehabilitating, and
reselling properties. When the prospective buyers of the Bayberry
Street property sought to reduce the contract price based on
Kniffen’s appraisal, Southwest’s president, “[u]sing [his] own
analysis and upon the advice of [his] agent,” rejected the offer.
Southwest later sold the residence to another buyer. Similarly, after
receiving Martell’s appraisal, Southwest challenged it by formally
asking for reconsideration of the appraisal’s property valuation.
When the prospective buyer cancelled the contract upon learning of
Southwest’s challenge, Southwest remarketed the property and sold
it to another buyer.

¶29           As asserted by Kniffen and Martell, the record does not
support Southwest’s assertions of reliance. Southwest doubted the
accuracy of both appraisals; in Martell’s case, it asked for the
appraisal to be reconsidered, and in Kniffen’s case, refused to lower
the contract price of the property. There is no indication Southwest
relied on either appraisal in acting or refraining from action. See
Western Techs., Inc. v. Sverdrup & Parcel, Inc., 154 Ariz. 1, 3, 739 P.2d
1318, 1320 (App. 1986) (party injured by negligent misrepresentation
“must have relied on the information the defendant supplied”); see
also Ness v. Western Sec. Life Ins. Co., 174 Ariz. 497, 502, 851 P.2d 122,
127 (App. 1992) (no reliance where plaintiff did not accept
defendants’ statements that he lacked disability insurance coverage,
consulted attorney, and ultimately brought action against insurer);
Wingate Land, LLC, 722 S.E.2d at 870 (no reliance where plaintiff
seller asserted information in appraisals was false); cf. Restatement
§ 537 (recipient of fraudulent misrepresentation may recover if he
relies on misrepresentation in acting or refraining from action and
reliance justifiable).9



      9 In its reply brief, Southwest argues “Ness is inapposite
because it involved, among other claims, a claim of common law
fraud, rather than a claim of negligent misrepresentation” and the
requirements of those torts “differ significantly.” Southwest asserts
that fraud requires detrimental reliance while negligent

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  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                        Opinion of the Court

¶30          Southwest also contends it relied on the appraisals
when it ultimately sold the properties to new buyers for reduced
amounts. The record, however, again does not support this
assertion. By affidavit, Southwest attested that in remarketing the
property after the contracts were cancelled, it “was mindful that [its]
agent would need to explain to interested buyers that the property
was back on the market because [it] failed to appraise for the prior
contract price,” and Southwest was “generally aware that a negative
association attaches to properties under these circumstances.”
Southwest then reported that it had sold the Harvester Drive house
for $136,000 and the Bayberry Street house for $152,000.10 Southwest
did not assert that it had relied on the appraisals in selling the
properties to subsequent buyers. Further, Southwest ultimately sold
the Harvester Drive house for $9,000 more than Martell’s appraisal
and the Bayberry Street house for $2,000 more than Kniffen’s
appraisal. For all these reasons, Southwest has not demonstrated a
genuine factual dispute as to its reliance.




misrepresentation requires only justifiable reliance. Both claims,
however, require “reliance” and in Ness we found none and,
consequently, no “reasonable reliance.” Ness, 174 Ariz. at 502, 851
P.2d at 127. Here, as well, we find no evidence of reliance and thus
no need to proceed to the question whether reliance was reasonable
(based on the complaining party’s information and intelligence) and
justifiable (depending on whether the misrepresentation is material).
St. Joseph’s Hosp. & Med. Ctr., 154 Ariz. at 316, 742 P.2d at 817. We
observe in passing that our supreme court in St. Joseph’s Hospital
uses “reasonable” and “justifiable” somewhat interchangeably in its
discussion of reliance. Id.
      10Southwest first listed the Harvester Drive property for
$135,000 and the Bayberry Street property for $165,000. Martell
valued the Harvester Drive property at $127,000 and Kniffen valued
the Bayberry Street property at $150,000. Southwest did not provide
the relisting prices of the properties following the disputed
appraisals.


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  SOUTHWEST NON-PROFIT HOUSING CORP. v. NOWAK, ET AL.
                        Opinion of the Court

                            Disposition

¶31         Based on the foregoing, the trial courts’ dismissal of the
negligence claim alleged against Nowak and grant of summary
judgment in favor of Kniffen and Martell are affirmed.




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