Cooper - Complaint No CB5806406 [2013] NZREAA 23 (7 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: CB5806406 and CB6562541

In the Matter of Ross Cooper

License Number: 10017372

Decision of Complaints Assessment Committee

Dated this 7th day of February 2013

Complaints Assessment Committee: CAC20006

Chairperson: Ann Skelton Deputy Chairperson: Paul Biddington Panel Member: Peter McDermott

Complaints Assessment Committee

Decision on Orders

1. Background

1.1. The Complaints Assessment Committee (the Committee) made a finding of unsatisfactory conduct against Ross Cooper (the Licensee) in its decision dated 25 October 2012. Submissions have been received on behalf of the Complainant and from the Licensee regarding what an appropriate order may be in these circumstances. The Committee also received an email from the Real Estate Institute of New Zealand confirming that no previous disciplinary action had been taken against the Licensee.

1.2. The Complainant submitted that the grounds of the finding of unsatisfactory conduct were too narrow and should have also included the Licensee’s conduct in relation to alleged non-disclosure of water-tightness issues and believed that the matter should have been referred to the Disciplinary Tribunal. Regardless of that submission, the Complainant stated that in relation to a financial order against the Licensee, the Licensee should be liable to reimburse the cost of two reports ($4,071.29), urgent repair work ($3176.01) legal fees in relation to the water-tightness issues ($2837.05) and legal fees in preparation of the complaint ($1,909) plus an estimated cost of repairs ($45,017.00). The Complainant also noted that $15,000 had been withheld on settlement and asked that this be set-off against any order made against the Licensee, or at least taken into account.

1.3. The Licensee submitted that an order censuring or reprimanding him would be an appropriate order in light of the fact that the Licensee believed the Act was unclear as to what amounted to written disclosure under section 136 and that he had not intended to mislead anyone.

2. Relevant Provisions

2.1. Having made a finding of unsatisfactory conduct against Ross Cooper 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 As a start point, the Committee reiterates that as the Licensee was the Vendor of the Property and not the listing or selling agent, the conduct that the Committee could review under the ambit of the Act was solely in relation to his disclosures under section 136. Any of the Licensee’s conduct that the Complainant believed was misleading, deceptive, negligent or fraudulent does not fall within the scope of the Act as the Licensee was not carrying out “real estate agency work” (as defined in section 2) but was acting in his capacity as Vendor at the time any representations were made. On that basis, any recourse against the Licensee himself falls within the civil jurisdiction, should the Complainant wish to take the issue against the Licensee further.

3.2 Any determination as to what orders, if any, should be made following a finding of unsatisfactory conduct must be in light of the purpose of the Act “to promote and protect the interests of consumers in respect of transactions that relate to real estate and to promote public confidence in the performance of real estate agency work”. One of the ways the Act sets out to achieve this purpose is by providing accountability through an independent, transparent and effective disciplinary process (section 3(2)).

3.3 The Committee reviewed the submissions on 26 November 2012. The Committee viewed this breach of conduct at the lower end of the scale and also took into account the Licensee’s acceptance of his breach of the Act. The Committee wished to reiterate that whilst section 136 did not set out the manner in which written disclosure must be made, it will only satisfy the requirements of the Act if such disclosure is clear and unequivocal.

3.4 The orders sought by the Complainant are not appropriate with the breach of section 136 and are not imposed.

4. Decision

4.1. In relation to the breach by the Licensee, the Committee orders censure of the Licensee pursuant to section 93(1)(a) of the Act.

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 to the purpose of the Act by 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 their company should be published.

5.4. The Authority will publish the Committee’s decision after the appeal period has ended. Any application for an order preventing publication must be made to the Disciplinary Tribunal.

6. Right of Appeal

6.1. A person affected by a determination of a Committee may appeal to the Disciplinary 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 lodging an appeal is available by referring to the Guide to Lodging an

Appeal at www.justice.govt.nz/tribunals.

Signed

Ann Skelton

Chairperson

Complaints Assessment Committee

Real Estate Agents Authority

Date: 7 February 2013