When an Appraisal Crossed the Line: A Story from Mejia v. People

There was nothing extraordinary about the assignment.

A bank needed a valuation. A borrower offered a house and lot as collateral. An appraiser—trained, licensed, experienced—went to the property, took measurements, observed the structure, and later submitted a report.

On paper, the numbers looked strong.

The property was valued at around PhP 22.8 million, and based on that figure, the bank approved a loan of roughly PhP18 million.

Everything followed the usual rhythm of banking practice:
valuation → approval → release.

No alarms. No hesitation.

At least, not yet.

Time, however, has a way of testing assumptions.

The borrower defaulted.
The bank foreclosed.

And when the property was subjected to a fresh valuation—this time under the pressure of recovery rather than approval—the numbers changed dramatically.

PhP10 million.
PhP9 million.
PhP8 million.

The earlier figure—PhP22 million—no longer looked like a judgment call.

It looked like a distortion.

When the case eventually reached the Supreme Court in Mejia v. People, the issue was not simply whether the appraisal was inaccurate.

Courts are familiar with disagreements in valuation. Markets move. Methods differ.

But this case was not about methodology.

It was about facts.

The floor area had been reported at more than 800 square meters, when in truth it was only around 250 square meters.
The structure was described as a two-storey building, when it was in reality a split-level, one-storey house.

These were not technical adjustments.

They were inputs that create value itself.

And more importantly, they were inputs that the appraiser knew would matter—because the report was never meant to remain theoretical.

It was meant to move the bank.

That is where the law enters the story.

The charge was not negligence.
Not incompetence.

But violation of the General Banking Law—specifically, overvaluing property for the purpose of influencing bank action.

And here lies the most important clarification the Court made:

Not every overvaluation is a crime.
It becomes a crime when it is done with intent to influence the bank’s decision.

This is where the worlds of appraisers and lawyers converge.

For appraisers, valuation has always been framed as professional judgment.

For lawyers, liability begins when intent and effect meet.

In this case, the Court saw both.

The appraiser argued that the property was “1.5 storeys,” and that the software required him to input “2.” That may sound technical, even reasonable at first glance.

But the Court focused on something deeper:

If he knew the description was not exact,
why did he not disclose it?

Why was there no remark?
No qualification?
No warning that the figure might not reflect reality?

That silence became crucial.

Because in law, especially when others rely on your statement:

What you do not say can be just as powerful as what you do.

The Court then drew the final line.

The valuation was not just wrong.
It was relied upon.

It influenced the bank’s decision.
It led to the approval of the loan.
It exposed the bank to loss.

And because of that chain—from report to reliance to consequence—the appraisal was no longer just a document.

It became an act with legal effects.

The conviction was affirmed.

And this is where the story turns into a lesson—especially for professionals like us.

For the appraiser, the case transforms the nature of the work:

Valuation is no longer insulated as “mere opinion.”
Once relied upon, it becomes a representation of fact.

For the lawyer, the case provides a powerful framework:

A technical report can become criminal evidence when:

There is misrepresentation of material facts
There is intent to influence
There is actual reliance

For both, the boundary between disciplines disappears.

The appraiser must now think like a lawyer:
What are the consequences of this statement?

The lawyer must think like an appraiser:
What inputs created this number?

But perhaps the most important lesson is this:

The market eventually corrects value.
But the law examines how that value was presented.

And when the presentation itself is distorted—
especially in a way that moves money, decisions, and institutions—

it ceases to be a professional error.

It becomes a legal wrong.

In the end, Mejia v. People is not just about one appraiser.

It is about a system built on trust.

Banks trust valuations.
Courts trust experts.
Markets trust signals.

And the moment those signals are knowingly distorted,

the law steps in—not to correct the value—

but to correct the conduct.

Mejia v. People establishes a clear doctrinal boundary:

Valuation is protected as opinion only up to the point that it remains analytical.
Once it influences decisions through misrepresented facts, it becomes actionable under the law.

For appraisers and lawyers alike, the message is unequivocal: