Chan - Complaint No CB5777642 [2012] NZREAA 195 (8 August 2012)

Last Updated: 12 January 2014

In the Matter of Part 4 of the Real Estate Agents Act 2008

And

In the Matter of Complaint No: CB5777642

In the Matter of James Chan

Licence Number: 10011383

Decision of Complaints Assessment Committee

Dated this 8th day of August 2012

Complaints Assessment Committee: CAC20005

Chairperson: Chris Rogers Deputy Chairperson: Stuart Rose Panel Member: Denise Bovaird

Complaints Assessment Committee

Decision on Orders

1. Background

1.1 On 7 March 2012 the Committee determined under Section 89 (2) (b) of the Real Estate Agents Act

2008 (the Act) that it had been proved, on the balance of probabilities that the Licensee James Chan had engaged in unsatisfactory conduct in terms of section 72(a) and 72(d) of the Act and that the Licensee had engaged in unsatisfactory conduct in terms of section 72(b) by contravening rules 9.1,

9.5 and 9.8(a) of the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2009 (the

Rules).

1.2 Parties to the complaint were given the opportunity to make submissions to the Committee on orders.

1.3 On 14 June 2012, the Committee received a submission on orders from the Complainants.

1.4 On 4 July 2012, the Committee received a submission on orders from James Chan (the Licensee).

2. Relevant Provisions

2.1 Having made a finding of unsatisfactory conduct against James Chan the Committee must now decide what orders, if any, should be made under section 93 of the Act.

Section 93 provides:

93 Power of Committee to make orders

(1) If a Committee makes a determination under section 89(2)(b), the Committee may do 1 or more of the following:

(a) make an order censuring or reprimanding the Licensee;

(b) order that all or some of the terms of an agreed settlement between the Licensee

and the Complainant are to have effect, by consent, as all or part of a final determination of the complaint;

(c) order that the Licensee apologise to the Complainant; (d) order that the Licensee undergo training or education;

(e) order the Licensee to reduce, cancel, or refund fees charged for work where that work is the subject of the complaint;

(f) order the Licensee:

(i) to rectify, at his or her or its own expense, any error or omission; or

(ii) where it is not practicable to rectify the error or omission, to take steps to provide, at his or her or its own expense, relief, in whole or in part, from the consequences of the error or omission;

(g) order the Licensee to pay to the Authority a fine not exceeding $10,000 in the case of an individual or $20,000 in the case of a company;

(h) order the Licensee, or the agent for whom the person complained about works, to

make his or her business available for inspection or take advice in relation to management from persons specified in the order;

(i) order the Licensee to pay the Complainant any costs or expenses incurred in respect

of the inquiry, investigation, or hearing by the Committee.

(2) An order under this section may be made on and subject to any terms and conditions that the Committee thinks fit.

3. Discussion

3.1 In his submission on penalty, the Licensee has conceded to failing to provide a written appraisal or an estimate of commission as required by Rules 9.5 and 9.8 of the Rules.

3.2 In mitigation, the Licensee submits that the Complainants have not shown any proof of loss or inconvenience as a result of the breach of Rules and at all times were well informed as to the way in which commission was to be charged.

3.3 The Licensee maintains that the agency agreement signed by the Complainants provided a basis on which fees would be payable, which was highlighted for the Complainants, and that discussions took place between the Licensee and the Complainants regarding the scale of charges for commission based on an estimated value deemed to be $1.5m - $2m.

3.4 The Licensee submits that the Complainants are experienced business people and vendors, well informed on how commission was charged, having marketed the property over a number of years with several different agencies and that the Complainants were at all times adamant about their pricing expectations whilst being aware of the commission percentages.

3.5 The Licensee submits that a written document would have merely made a record of what was discussed and agreed between the parties.

3.6 In their submission on penalty the Complainants have made no particular reference to the Licensee’s failure to provide an appraisal or an estimate of commission to them in writing other than to maintain that the Licensee ‘admitted he had done a lot of mistakes and apologised for the trouble and losses caused’.

3.7 In his submission on penalty the Licensee conceded to acting arbitrarily in deciding to alter the date of the auction.

3.8 In mitigation the Licensee maintains that the change of date was in order to give the property more publicity and therefore generate more interest. The change of date meant that the auction would coincide with a gala auction being held by Bayleys and that the Complainants would benefit from more potential bidders being present on the day and some free advertising, effectively receiving a discount on the marketing costs.

3.9 The Licensee maintains that the signage showing the amended auction date was erected just 2 days prior to a meeting held between the parties at which time the Complainants seemed completely happy with the change of date and the new strategy regarding the gala day.

3.10 The Licensee maintains that the Complainants did not mention any issues regarding their flights and that no loss could have been suffered as the auction still took place 2 days before the Complainants were due to fly back home.

3.11 The Complainants submit that having arrived at the property on 13 September 2012, they were surprised to discover the auction date had been changed without any prior notification and that although the Licensee had then explained the rationale behind it, they were very unhappy and the

change of plan had in fact ‘caused us a lot of trouble and losses’.

3.12 The Licensee submits that the Complainants declined an offer of $1,000 as a sign or gesture of goodwill from Bayleys and have failed to quantify any losses.

4. Decision

4.1 The Committee finds as follows:

4.2 Having regard to the facts of this case and the finding of unsatisfactory conduct in the Committee’s determination dated 7 March 2012, as well as the submissions on orders made by both parties and the principles set out in section 3 of the Act, the Committee has determined to make the following orders pursuant to section 93(1) of the Act:

4.3 Licensee James Chan is to be reprimanded under section 93(1)(a) of the Act.

4.4 The Licensee shall pay a fine of $2,000 to the Real Estate Agents Authority within 10 working days of this order under section 93(1)(g) of the Act.

4.5 No other orders are considered appropriate.

5. Publication

5.1 One of the Committee’s functions pursuant to section 78(h) of the Act is to publish its decisions.

5.2 Publication gives effect the purpose of the Act of ensuring that the disciplinary process remains transparent, independent and effective. The Committee also regards publication of this decision as desirable for the purposes of setting standards and that it is in the public interest that the decision be published.

5.3 The Committee directs publication of its decision, but omitting the names and identifying details of the Complainant (including the address of the property), and any third parties in the publication of its decision. The name of the Licensee and the Company he/she works for should be published.

5.4 The Authority will publish the Committee’s decision after the period for filing an appeal has ended unless an application for an order preventing publication has been made to the Real Estate Agents Disciplinary Tribunal (the Tribunal). Such an application can only be made as part of an appeal to that Tribunal. In order to ensure publication of the decision does not take place it is important that you serve a copy of your application on the Authority. Publication of the decision will not take place until the Tribunal has made a decision on the application.

6. Right of Appeal

6.1 A person affected by a determination of a Committee may appeal to the Tribunal against a determination of the Committee within 20 working days after the date of this notice.

6.2 Appeal is by way of written notice to the Tribunal. You should include a copy of this Notice with your Appeal.

6.3 Further information on filing an appeal is available by referring to the Guide to Filing an Appeal at www.justice.govt.nz/tribunals.

Signed

Chris Rogers

Chairperson

Complaints Assessment Committee

Real Estate Agents Authority

Date: 6 August 2012