Soderberg v. McKinney

Opinion

MASTERSON, J.

In Bily v. Arthur Young & Co. (1992) 3 Cal.4th 370 [11 Cal.Rptr.2d 51, 834 P.2d 745], the Supreme Court held that an auditor may be liable to a third party—someone other than a client—who relies on an audit report containing negligent misrepresentations, provided the auditor intended that the third party use the report. In this case, we address whether such liability extends to a real estate appraiser who, although retained by a mortgage broker, knows that his report will be used by potential investors in the brokered loan. We hold that it does.

Background

For several years,…