‘Expert’ Testimony Offers Steady Cash in a Slow Market
As the real estate market sank into a recession this decade, some in the real estate trade found additional work in one area that never seems to slow down: helping clients battle through real estate-related lawsuits.
A lot of these cases don’t end up in court, but in arbitration hearings. Still, when there is a legal case, it often requires “expert” depositions--out of court testimony by a witness for hire.
But the boom in expert witnesses rankles some. “People seem to be coming into this field as a way to make easy money,” complained Ira Gribin, an expert witness himself and a past president of the National Assn. of Realtors, California Assn. of Realtors and the San Fernando Valley Assn. of Realtors. Many experts, he contended, are too willing to mold their expert opinions based on who is paying them.
“I try to pick cases that I believe in,” said Gribin, a resident of Encino. “My contract specifically says that my involvement is subject to my review of all documents and all the information I want to get. If after my research I think the client is off-base, I’ll back out.”
Gribin reported that he has been retained to work on 100 cases over the last seven years--mostly related to disputes among home buyers, sellers and residential real estate agents. Only about 20 of these cases required him to give a deposition and about 10 required testimony in court. Nearly all of the cases, however, dragged on for a very long time, Gribin said. “We are in a very litigious society.”
Stephen C. Wexler decided several years ago to take advantage of the popularity of litigation by adding expert witness services to his construction, engineering and management company--Wexco International Corp. based in Marina del Rey. Expert witness work and so-called litigation support now account for 40% of Wexco’s business, Wexler said. “Because of the real estate recession, we tried to anticipate other kinds of services we could offer.”
Last year’s earthquake has been something of a boon to business for Wexler and others hired by property owners who are in conflict with contractors or insurance companies.
Wexler’s company, for example, was retained by owners of a Simi Valley home who hired a contractor to fix earthquake repairs and now are dissatisfied with the work. Wexco was hired to comment on whether the work was done properly; experts at the company plan to testify at an upcoming arbitration that it wasn’t.
All told, Wexler said, his company has consulted on about 400 cases, most in the past half dozen years. But only about 5% have led to testimony in a courtroom.
Before stepping into a courtroom, there is lots of other work for expert witnesses, Wexler said. “We let clients know the strength and weaknesses of their case and we then advise them when to settle.” The most common cases that Wexco is hired to work on involve construction-related accidents, defects and disputes over delays. Wexler’s company charges from $95 to $250 an hour.
Wexco advertises in various legal publications, but he warns people about just picking an expert with a nice advertisement. “I’ve seen many cases where the opposing expert is no expert at all,” Wexler said. It’s important, he said, to look for someone who is well-organized and well-schooled in making a good presentation. “The objective is to be objective,” he said.
“When you testify as an expert, you must be objective and neutral. There’s no other way,” said E. Jane Arnault, president of JurEcon Inc., a downtown Los Angeles litigation and management consulting firm.
Arnault said very few of the cases that her company works on ever end up in a trial. “Our highest and best use is to actually help clients avoid litigation,” she said. Arnault and about two dozen other experts at her 14-year-old company work either on an hourly or flat-fee basis on issues involving real estate evaluation, land use, condemnation, contracts and lease disputes. Arnault wouldn’t say how much she charges.
Arthur Mazirow, an attorney with the law firm Freeman, Freeman & Smiley in West Los Angeles, recalled that he has been retained about 11 times as an expert witness on issues related to real estate purchase and sale contracts and issues of lawyer malpractice.
He is now involved as an expert in a case brought by the Metropolitan Water District alleging that bad advice from the law firm of Paul, Hastings, Janofsky & Walker caused the agency to lose millions of dollars in a botched effort to find a new headquarters in downtown Los Angeles. The law firm maintains that the allegations are without merit.
“I get a lot of calls from people who think they need an expert, but they don’t,” Mazirow said. “People call me up and want me to say things I won’t say, so I decline more cases than I accept.” Mazirow also explained that the appropriate things for an expert to talk about in court are generally limited to standards of care or custom and usage in a particular industry. It also helps to be authoritative, likable and credible.
“It is very dangerous for someone to hold themselves out as an expert, because they will have their credentials questioned in court by opposing counsel,” he said. “It’s very stressful work. You have to be prepared to defend your positions.”
Nevertheless, construction- and real estate-related experts are in strong demand, especially in Southern California.