Morison - Complaint No CO1190 [2013] NZREAA 292 (26 November 2013)

Last Updated: 16 September 2014

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

And

In the Matter of Complaint No: CO1190

In the Matter of Gail Morison

License Number: 10055643

And

Duncan Morison
License Number: 10055635

Decision of Complaints Assessment Committee

Dated this 26th day of November 2013

Complaints Assessment Committee: CAC20002

Chairperson: Patrick Waite

Deputy Chairperson: Deirdre McNabb

Panel Member: Barrie Barnes

Complaints Assessment Committee

Decision on Orders

1. Background

1.1 By its decision dated 1 October 2013, the Complaints Assessment Committee (the Committee) made a determination under section 89(2)(b) of the Real Estate Agents Act 2008 (the Act) that the Licensees, Ms. Gail Morison and Mr. Duncan Morison, of Premium Real Estate Limited (the Licensees) have engaged in unsatisfactory conduct as that term is defined in section 72 of the Act.

1.2 Having made a determination under section 89(2) (b) the Committee may make one or more of the orders set out in section 93 of the Act.

1.3 The Committee invited the Licensees and the Complainant to make any comments or submissions they wished within ten working days from the date of the Committee's determination.

1.4 The Complainant responded on 21 October 2013 advising that she had no further submissions to make on the matter.

1.5 The Licensees in response in an email dated 30 October 2013 whilst advising that they intend to appeal the decision made the following submissions (as recorded from their submissions):

1. “There should be no publication of our names as the damage to our reputations will far exceed any damage that we have caused and cannot be compensated for once the Marina is complete.

2. The complaint was vexatious and we have not caused any loss or damage to the Complainant.

3. The Complainant was neither the client nor the customer as referred to in Rule 6.4.

4. The decision was based on a ‘balance of probability’ and not ‘reasonable doubt”.

5. The REAA should not be used in such a blatant manner by outside parties in order to foster their own outside agenda. In this case the Complainant sought to stifle all references to the Marina going ahead because she is a protestor against the project. “N.B. We are not Yacht Club members and are not and never have been involved in the marina development in any way.”

6. It is commonly held belief in the local area that the Marina development will be completed.

7. Parts of the completed project such as the Office, haul out area, loading dock and some parking have already been built and further land for car parking purchased.

8. The Complainant has stated she is satisfied with the action taken by the REAA to date.

9. We submit that there should be no publication of our names or further penalty and that this case should be dismissed.“

1.6 Having satisfied itself that it had completed its inquiry into the complaint, the matter was considered on 19 November 2013.

1.7 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. Relevant Provisions

2.1 Having made a finding of unsatisfactory conduct against the Licensees 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 The Committee in its determination of 1 October 2013 concluded that on the balance of probabilities Ms. Gail Morison and Mr. Duncan Morison had engaged in unsatisfactory conduct. In the Committee’s decision they noted: “Whilst the Committee accepts that the Licensees may not have deliberately set out to mislead people the Committee considers the advertising used by the Licensees with the phrase “under construction” was inaccurate” and potentially misleading”. The Committee concluded that in advertising the marina development in the way that they did the Licensees have breached Rule 6.4. A Licensee must not mislead a customer or client, nor provide false information, nor withhold information that should by law or fairness be provided to a customer or client. “

3.2 Whilst the Licensees submit that “the complaint was vexatious and they have not caused any loss or damage to the Complainant” and that “it is commonly held belief in the local area that the Marina development will be completed” the reality was that at the time of the advertising there was no certainty that the Marina development would be developed. The advertising therefore had the potential to mislead people who may have been considering purchasing a Property in that area.

4. Decision

Principles considered

4.1 The Committee, when determining whether or not to make an order under section 93(1), has also had regard to the functions, which the imposition of a penalty usually must serve in professional disciplinary proceedings. They include:

a. P rom oti ng and protecti ng the i nterests of consume rs a nd the publ i c g eneral l y

Section 3(1) of the Act sets out the purpose of the legislation. The principal purpose of the Act is "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 in which the Act states it achieves this purpose is by providing accountability through an independent, transparent and effective disciplinary process (section 3 (2)).

b. Mai ntenance of professi onal standards

This function has been recognized in professional disciplinary proceedings involving other professions (for example, in medical disciplinary proceedings; Taylor v The General Medical Council [1990] 2 All ER 263; and in disciplinary proceedings involving valuers; Dentice v The Valuers Registration Board [1992] 1 NZLR 720). In the Committee's view this function is also applicable in the disciplinary processes under the REAA.

c. P uni shment

The Committee accepts that a penalty in a professional disciplinary case is primarily about the maintenance of standards and the protection of the public. However in the Committee's view there is also an element of punishment - indicated by the power the Committee has to impose a fine (section 93(l) (g); or make an order of censure (section 93(l) (a)). The element of punishment has been discussed in the context of other professional disciplinary proceedings (see Patel v Dentists Disciplinary Tribunal (High Court, Auckland, CIV 2007-404-

1818 Lang J 13 August 2007, where the Court said that disciplinary proceedings inevitably involve issues of deterrence, and penalties are designed in part to deter both the offender and others in the profession from offending in a like manner in the future.)

d. Where appropri ate, rehabi l i tati on of t he professi onal m ust be consi dered

The Committee regards its power to make an order requiring a Licensee to undergo training or education as indicative of this function applying in the context of professional disciplinary processes under the Act.

4.2 The Committee acknowledges that when making an order under section 93, the order/s made must be proportionate to the offending and to the range of available orders.

4 3 Having regard to the facts of this case as recorded in the Committee’s determination dated 1 October

2013, and the established unsatisfactory conduct and functions which the imposing of a penalty is designed to serve, the Committee has determined to make the following orders under section 93(1):

4.3.1 The Committee is imposing on each of Ms. Gail Morison and Mr. Duncan Morison a fine of

$1,000 (total of $2,000) payable to the Authority within 20 working days of this order.

4.3.2 The Committee censures Ms. Gail Morison and Mr. Duncan Morison.

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 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 (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

w w w. just ice. g ov t. nz /t ribunals .

Signed

Patrick Waite

Chairperson

Complaints Assessment Committee

Real Estate Agents Authority

Date: 26th November 2013