Complaint No CB6973292 [2013] NZREAA 19 (1 February 2013)

Last Updated: 16 February 2014

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

And

In the Matter of Complaint No: CB6973292

In the Matter of Licensee 1

Licence Number: XXXX XXXX

Decision of Complaints Assessment Committee

Dated this 01st day of February 2013

Complaints Assessment Committee: CAC20005

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

Complaints Assessment Committee

Decision to take no further action

1. The Complaint

1.1. Mr and Mrs C (the complainants) have complained to the Real Estate Agents Authority (the Authority) about the conduct of Licensee 1 (the Licensee). The Licensee is licensed under the Real Estate Agents Act 2008 (the Act). Licensee 1 holds a branch manager’s licence and is working for Agency A.

1.2. The complainants believe that the licensee may have provided a third party with false and

misleading information regarding the integrity of the complainant’s property.

1.3. The complaint was received by the Real Estate Agents Authority (the Authority) on 25 July 2012 and referred to a Complaints Assessment Committee (the Committee). The Committee considered the complaint on 10 August 2012 and determined to enquire into the complaint. The committee received and considered an investigation report on 14 December 2012.

2. Material Facts

2.1. The Complainants listed the property for sale on a sole agency basis with Agency A on 17 May

2012. The listing was completed by the licensee and noted the exclusion of one named party.

2.2. On 5 June 2012 the complainant made contact with the licensee and requested cancellation of the sole agency with Agency A to facilitate their signing up with other agencies on a general listing basis.

2.3. The licensee confirmed termination of the complainant’s listing contract on 6 June 2012.

2.4. The complainant informed the licensee on 27 June 2012 that the property was now listed with another agency. A copy of that listing indicates a sole agency for 30 days from the date of signing.

2.5. The complainants maintain that on 9 July 2012 they received a phone call, from a salesperson working for the agency holding the current listing for the property, to inform them that a prospective purchaser introduced through that agency would not now be submitting an offer for the property because the finance company involved had declined to lend the prospective purchaser funds due to advice they had received from the licensee with regard to the property being ‘leaky’ and unsuitable.

3. Relevant Provisions

3.1. A complaint can only be made in relation to alleged unsatisfactory conduct (section 72 of the

Act) or alleged misconduct (section 73 of the Act).

3.2. The Real Estate Agents Act 2008

Section 72 of the Act provides:

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 or 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.

3.3. Section 73 of the Act provides:

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 willful 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.

3.4. Real Estate Agents Act (Professional Conduct and Client Care) Rules 2009. (the rules)

Rule 6.3 A licensee must not engage in any conduct likely to bring the industry into disrepute.

4. Discussion

4.1. The complainants believe that, when consulted by a financial institution in the process of assessing a loan enquiry from prospective purchasers for the property who were dealing with a rival real estate company, the licensee provided false and misleading information regarding the weathertightness of the property which effectively led to finance being declined and a potential sale not proceeding. The committee has not been provided with any evidence to support this claim and indeed the complainants concede to have no such evidence.

4.2. The licensee denies having any conversation regarding the property with the financial institution in question other than to confirm when asked that a listing was no longer in place with Agency A.

4.3. The financial institution has confirmed that general advice only regarding watertightness issues with certain classifications of New Zealand property was given to the prospective purchaser and

that the only conversation conducted with the licensee was in an attempt to arrange a referral of the prospective purchaser if possible. No advice was given to the prospective purchaser to indicate that an application for finance to purchase the property would be declined if applied for.

4.4. The prospective purchaser has confirmed that discussions with the financial institution around watertightness issues were of a general nature only and her reasons for not maintaining interest in the property were based on various sources of advice and information sought as new immigrant and first time property buyer in New Zealand. She was not denied finance and was given no reason to believe she would be denied finance on this property if she had applied for it.

4.5. The allegation of wrongdoing on the part of the licensee seems to be based on assumptions and “putting two and two together ” by the complainants based on a conversation with a salesperson also jumping to conclusions with regard to the licensee’s possible involvement in a prospective purchaser’s reasoning for not purchasing the property.

4.6. The committee finds no evidence of conduct on the part of the licensee that would breach the threshold of unsatisfactory conduct or misconduct as defined by the Act.

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 determined under section 89(2)(c) of the Act to take no further action with regard to the complaint or any issue involved in the complaint.

6. Publication

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

6.2. 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.

6.3. The Committee directs publication of its decision, but omitting the names and identifying details of the complainant (including the address of the property), the licensee and any third parties in the publication of its decision.

6.4. The Authority will publish the Committee’s decision after the period for filing an appeal has ended. Any application for an order preventing publication must be made to the Real Estate Agents Disciplinary Tribunal (the Tribunal).

7. Right of Appeal

7.1. 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.

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

7.3. 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: 01 February 2013