Davie - Complaint No CB7183964 [2013] NZREAA 173 (28 June 2013)

Last Updated: 1 June 2014

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

And

In the Matter of Complaint No: CB7183964

In the Matter of Paul Davie

License Number: 10001910

Decision of Complaints Assessment Committee

Dated this 28th day of June 2013

Complaints Assessment Committee: CAC20002

Chairperson: Deirdre McNabb

Panel Member: Barrie Barnes

Complaints Assessment Committee

Decision finding unsatisfactory conduct

1. The Complaint

1.1. The Complainant has complained to the Real Estate Agents Authority (the Authority) about the conduct of Mr. Paul Davie (the Licensee). The Licensee is a licensed salesperson under the Real Estate Agents Act 2008 (the Act). He is employed by Austar Realty Limited trading as LJ Hooker.

1.2. The complaint is that the Complainant asked the Licensee to withdraw his Property from the market on 17 September 2012 and the Licensee did not respond to that request or subsequent phone calls. The Property continued to be shown as listed for sale with the Licensee in October

2012. The Complainant believes that the continued advertising of the Property when he asked for it to be withdrawn from the market has caused people to lose interest in it and it has therefore been adversely affected.

1.3. The Authority referred the complaint to the Complaints Assessment Committee (the Committee).

Pursuant to section 79(1) of the Act, the Committee considered the complaint on 3 December

2013 and made a decision to inquire into it. Once the enquiry was completed the matter was considered by the Committee again on 4 June 2013.

1.4. The hearing was conducted on the papers pursuant to section 90(2) of the Act and the Committee made its determination on the basis of the written material before it.

2. Material Facts

2.1. On 25 May 2012 the Complainant and his wife signed a sole agency listing agreement with Austar Realty Limited for the sale of the Property. The listing agent was Ms D of that firm. The sole agency applied for two months until 25 July 2012 after which time it became a general agency.

2.2. On 17 September 2012 the Complainant emailed the Licensee and asked him to immediately withdraw the Property from the market and remove any signage from the Property. On the same day the Licensee responded to the Complainant to say that he was out of town until Wednesday (the day of the emails was Monday) and that he would remove the sign at the Property the following weekend when he would be out there doing other open homes.

2.3. The Licensee also told the Complainant that there was a party interested in the Property and he sought instructions on whether the Complainant wanted that interest to be pursued. The Complainant responded the same evening saying that he would be interested in looking at an offer.

2.4. The following day the Licensee emailed the Complainant back and advised him that he would need to sign an extension to the exclusive listing for them to present an offer to him. He told the Complainant that he would follow up with the buyer when he was back in Auckland on the Thursday. Later that week the Complainant emailed the Licensee saying that he had been waiting for him to come back to him since the Thursday and that he would like to hear from him ASAP. He told the Licensee that if he did not hear from him by 5pm on the 25th September 2012 then the listing on the Property was to be withdrawn from 26 September 2012 and all signs were to be removed.

2.5. There was no offer forthcoming from the Licensee. The Complainant provided a copy of a screenshot dated 2 October 2012 taken from the TradeMe website for the sale of residential

property. This shows the Property as being available for sale at that date with the agent details listed as the Licensee and Ms D.

2.6. A diary entry provided by the Licensee shows that on 9 October 2012 he met with the Complainant.

According to the diary note he explained that as of 27 September 2012 the Property was withdrawn and the Licensee had no claim to commission or rights to introduce buyers. It was also noted that the Complainant had been told by another agency that they could not list the Property because Austar Realty Limited still had an agency. He says he explained that as of 27 September there was no agency and he could list with anyone he liked. Finally the diary note says that the Complainant left happy.

2.7. On 9 October the Licensee wrote to the Complainant stating that the listing that he had with the

Licensee had been cancelled with signage removed approximately two weeks ago on 27 September

2012. He stated that he had been following up a possible buyer from another country but that there had been no response from that person. Apparently the receptionist from the Licensee’s agency was instructed to remove all advertising from the internet on 5 October 2012. The Licensee stated that he had not held any open homes or introduced any new buyers to the Property after 17

September 2012 (this was later corrected in the Licensee’s response in order to remove the month

of October which had been put in that correspondence in error).

2.8. An Active Residential Listings Detail Report in the name of Austar Realty Limited shows that the

Agency Status for the Property was ‘Exclusive W 5/10/12’.

2.9. The Licensee responded to the complaint and made the following points that the Committee found particularly relevant to his conduct:

2.9.1.He understood that after a property is withdrawn from sale (in this case on 26 September

2012) he still had a seven day window of opportunity to complete any current dealings after

the termination date (a ‘working period’).

2.9.2.Using the above rationale he believed he had until 3 October 2012 to cease all activity in relation to the Property.

2.9.3.Signs were apparently removed from the Property on 27 September 2012.

2.9.4.On 5 October the receptionist at Austar Realty Limited was instructed to withdraw all advertising from the internet and withdraw the Property.

2.9.5.Trade Me did not remove the Property the first time they were instructed to do so and had to be contacted again. This caused the Property to be on that website two extra days over the weekend.

2.9.6.The Licensee did not consider the Property was left on the market a long time as it was two days after the expiry of the working period described in 2.9.1.

3. Relevant Provisions

3.1. The Committee examined the information supplied by the parties to determine whether section 72 or section 73 of the Real Estate Agents Act 2008 (the Act) applied i.e. was there evidence which would indicate that the Licensee could be considered guilty of unsatisfactory conduct (section 72) or misconduct ( section 73).

Section 72 Unsatisfactory conduct

For the purposes of this Act, a licensee is guilty of unsatisfactory conduct if the licensee carries out real estate agency work that –

(a) Falls short of the standard that a reasonable member of the public is entitled to expect from a reasonably competent licensee; or

(b) Contravenes a provision of this Act or of any regulations of rules made under this Act; or

(c) is incompetent or negligent; or

(d) would reasonably be regarded by agents of good standing as being unacceptable.

Section 73 Misconduct

For the purposes of this Act, a licensee is guilty of misconduct if the licensee’s

conduct –

(a) would reasonably be regarded by agents of good standing, or reasonable members of the public, as disgraceful; or

(b) constitutes seriously incompetent or seriously negligent real estate agency work; or

(c) consists of a wilful or reckless contravention of –

(i) this Act; or

(ii) other Acts that apply to the conduct of licensees; or

(iii) regulations or rules made under this Act; or

(d) constitutes an offence for which the licensee has been convicted, being an offence that reflects adversely on the licensee’s fitness to be a licensee.

3.2. Real Estate Agents Act (Professional Conduct and Client Care) Rules 2009

5.1 A Licensee must exercise skill, care, competence and diligence at all times when carrying out real estate work.

4. Discussion

4.1. The Committee considered all of the material before it together with the Licensee’s response to the

allegations made by the Complainant.

4.2. It noted that the Complainant was entitled to withdraw his Property from sale at any time. There is no dispute that the Complainant had originally sought to withdraw the Property from sale on 17

September 2012 but through email correspondence with the Licensee he extended the period of time of his agency until 5pm on 25 September 2012.

4.3. It is clear that the Complainant did not receive anything further from the Licensee and so the agency expired at the end of the day on 25 September 2012 as envisaged in the email correspondence between the parties.

4.4. The significant error made by the Licensee after this time was his mistaken belief that he had a further seven days from 25 September, a time period he called a ‘working period’, during which time he believed he could continue to market the Property. The Agency was cancelled immediately effective from 26 September 2012. The Committee noted that between the removal of the Property from the internet advertising did not occur until 5 October 2012 and likely 7 October 2012 with the TradeMe website. This meant that the Licensee continued to market the Property as if he had a listing for it, over a 10 day period from 26 September to 5 October 2012.

4.5. The Committee is of the view that continued internet marketing of a property for ten days after the listing has been withdrawn falls short of the required standard of care that members of the public can expect from Licensees.

5. Decision

5.1. After conducting an inquiry into the complaint, pursuant to section 89(1) of the Real Estate Agents Act 2008 (the Act), the Committee held a hearing with regard to that complaint. In accordance with section 90(1) of the Act, the Committee conducted the hearing on the papers, and pursuant to section 90(2) the Committee’s determination was made on the basis of the written material before it.

5.2. The Committee has come to the conclusion that on the balance of possibilities, the Licensee had engaged in unsatisfactory conduct in breach of Rule 5.1 of the Professional Conduct and Client Care Rules.

6. Orders

6.1. The Committee will conduct a separate hearing on the papers to 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 apologize 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.

6.2. The Committee requires the Case Manager to obtain a record of any previous disciplinary decision in respect of the Licensee under either the Real Estate Agents Act 1976 or the Act, if any such decision exists, and provide it to the Committee, the Licensee and the Complainant.

6.3. The Licensee and the Complainant may file submissions on what orders, if any should be made. The Complainant may file a submission within 10 working days from the date of the decision. The Committee directs that such a submission from the Complainant is limited to aspects to do with the Listing Agreement only. This submission, if any, will then be provided to the Licensee, with a timeframe for filing final submissions.

7. Publication

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

7.2. The Committee has deferred making any decision on publication until its hearing to decide what orders, if any, should be made.

8. Right of Appeal

8.1. A person affected by a determination of a Complaints Assessment Committee may appeal by way of written notice to the Real Estate Agents Disciplinary Tribunal (the Tribunal) against a determination of the Committee and must do so within 20 working days from the date of the determination.

8.2. The Committee considers that the 20 working day appeal period does not commence until it has finally determined this complaint by deciding what orders should be made, if any.

8.3. Appeal is by way of written notice to the Tribunal. Further information on filing an appeal is available by referring to the Guide to Filing an Appeal at www.justice.govt.nz/tribunals.

Signed

Deirdre McNabb

Chairperson

Complaints Assessment Committee

Real Estate Agents Authority

Date: 28th June 2013