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Appraisal: Nursery/Tree Farm

appraisal nursery tree farmAppraisal: Nursery/Tree Farm

The most difficult assignment for an arborist or other professional appraiser is evaluating  a nursery or tree farm, and the required expertise is exponentially greater if business damages are involved. Further, if the assignment falls under eminent domain, an even greater degree of expertise is required.

Nursery and tree farm appraisals are not for the faint of heart. Most appraisers think that an inventory of plant material and pricing is required for a successful report; such is far from the case. The appraiser must consider case law regarding inventories and their values. Data from the inventory must demonstrate to the trier of fact the species representation, the container size population, and marketplace demands including a grueling comparable pricing exercise. The appraiser must know how much soil is required to fill whatever container size is being appraised.

This volume of required soil must consider the area of the plant root ball size. Other considerations are the value of the plant before it is placed into a container, the labor to place it in a container, add soil and fertilizer, set it on a trailer, and place it in inventory. The cost of the container must be factored including the resources necessary to locate it and the plant that will be placed into it.

If the loss of the plants or trees is a partial loss, such as from a road widening, gas pipeline, theft, vandalism, or act of God, that loss must be paired to the remaining inventory to reflect an after situation offering to the end user. Mathematics play a strong role in the opinion of damages.

Not one area of expertise can be applied to this assignment. An arborist or horticulturalist may have the expertise to analyze the data of the entire nursery as it relates to the parts taken; however, a CPA will be needed to calculate immediate damages and those damages into the future. A member of the Appraisal Institute (MAI) may be required to render an opinion of damages to the entire site, not just the plant material growing on the site.

An arborist or horticulturalist may be able to effectively calculate plant and tree losses, but it is highly doubtful that they will qualify in a voir dire as to their competence to testify, just like a CPA proving proficiency in conducting a plant inventory. No matter the efficacy of their work, they are not qualified to do so, and the probability of their opinion seeing the light of day in testimony is remote.

The appraiser must have proven credentials and expertise regarding Curing a damaged nursery. If collecting the data associated with the losses of an inventory could be considered undergraduate work, the Curing of a tree farm or nursery may be compared to acquiring a PhD in the subject matter.

Appraising the value and lost function of a tree farm or nursery is best left to a team of experts.

The articles presented here do not make any legal recommendations or representations, as the author is not qualified to do so. These articles are for educational and entertainment purposes only. Seek the advice of a qualified attorney regarding questions of law.

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