Complaint No C20983 [2017] NZREAA 127 (20 December 2017)

Last Updated: 22 June 2018

Before the Complaints Assessment Committee

Complaint No: C20983

In the matter of

Part 4 of the Real Estate Agents Act 2008

and

Licensee: The Licensee (XXXXXXXX)

Decision to take no further action

20 December 2017

Members of Complaints Assessment Committee: CAC416

Chairperson: Marjorie Noble

Deputy Chairperson: Rachael Schmidt-McCleave

Complaints Assessment Committee

Decision to take no further action

1. The Complaint

1.1. On 19 June 2017 the Real Estate Agents Authority (the Authority) received a complaint against the Licensee from the Complainant.

1.2. The Licensee is a licensed Salesperson under the Real Estate Agents Act 2008 (the Act).

1.3. The complaint relates to a residential property (the Property).

1.4. The details of the complaint are that the Licensee failed to disclose that a fence at the Property was not on the boundary and an area of land inside the fence did not belong to the Property, but is owned by the Council Controlled Organization.

1.5. In particular, the Complainant advised that

a) The Licensee should have known this when she listed the Property and as a result he has lost up to 30% of the land he thought belonged to him which could potentially result in a loss of money when he sells the Property.

1.6. The Complainant requested a remedy, being:

a) The Licensee to be held accountable.

b) Compensation for loss of value of land area.

1.7. The Licensee responded to the complaint against her.

1.8. In particular, the Licensee commented that

a) When she listed the Property the vendors never mentioned anything about the affected land.

b) The vendors were unaware the affected land belonged to the Council Controlled

Organization.

c) She never showed the Complainant around the Property or met or spoke with the

Complainant.

d) There was nothing to alert her that the boundary was anywhere other than it was represented.

e) The title did not show any areas that had easements or interests of land belonging to another party.

f) The LIM report did not contain any references to the location of the boundary/fence lines or that the land was owned by the Council Controlled Organization.

g) When she viewed the Property it was impossible to tell the size of the land area and not something she considered or questioned.

2. What we decided

2.1. On 11 September 2017 Complaints Assessment Committee 410 considered the complaint and decided to inquire into it.

2.2. On 1 November 2017 the complaint was referred to Complaints Assessment Committee 416

(the Committee) for consideration1. The Committee considered the original complaint afresh and on 6 November 2017 decided to inquire into it under section 79(2)(e) of the Act.

2.3. On 29 November 2017 the Committee held a hearing on the papers and considered all the information gathered during the inquiry.

2.4. The Committee has decided to take no further action on the complaint.

2.5. This decision was made under section 89(2)(c) of the Act. The decision was also made with reference to the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2012, and in particular Rules 5.1 (Skill, care) and 6.4 (must not mislead).

3. Our reasons for the decision

3.1. The Committee concluded:

No evidence to show the Licensee knew or could have known the boundary was different to the fence line

3.2. The Complainant considered that the Licensee should have visually seen the Property was larger than advertised, and that she should have ensured the LIM report accurately represented the Property, before advertising the Property for sale. The Committee agreed this was not practical as the Licensee is not a surveyor. The Licensee was not informed by the vendors of the situation and the evidence shows it is likely the vendors were just as unaware of the boundary issue as the other parties were. The licensee the Complainant had contact with during the time of the transaction left the industry over two years ago, but there was no evidence to show that she discussed the boundary or size of the Property with the Complainant either.

3.3. The LIM report and the title made no references to the issue and the Complainant only discovered the problem when he investigated the possibility of landscaping the Property. The Licensee is not required to know the exact boundaries of an older established Property. This would only be a requirement if the Property was bare land and would then require boundary pegs to be present.

3.4. The Licensee had no contact with the Complainant and marketed the Property as a “do up” which is a reasonable claim for an older property. The Complainant said he could not “do up” the Property due to finding some of the land did not belong to him. However, the Committee agreed the “do up” part of the marketing would, in general, relate to the improvements on the Property, namely typically the residence. It is unfortunate for the Complainant this has happened but he did purchase the amount of land that the title showed. This type of inconsistency with the fence and the boundary is very unfortunate but not something the Licensee could fairly be held to account for. It would have been next to impossible for the Licensee to discover this and therefore the Committee dismisses the Complaint and will take no further action on it.

4. Your right to appeal

4.1. If you are affected by this decision of the Committee, you may appeal in writing to the Real Estate Agents Disciplinary Tribunal (the Tribunal) within 20 working days after the date of notice of this decision (no later than Monday, 29 January 2018) (Section 111).

4.2. For further information on filing an appeal, read Guide to Filing an Appeal at Mi ni stry of

J usti ce -Tri bunal s ( ww w. justi ce. g ov t. nz/ tri bunal s ).

1This transfer was due to reasons unrelated to this complaint.

5. Publication

5.1. At the Committee’s discretion, the decision will be published without the names or identifying details of the Complainant (including the address of the Property), the Licensee, and any third parties.

5.2. The Authority will publish the Committee’s decision after the period for filing an appeal has ended, unless the Tribunal receives an application for an order preventing publication. The Authority will not publish the Committee’s decision until the Tribunal has made a decision on the application.

5.3. Publishing the Committee’s decision supports the purpose of the Act by ensuring that the disciplinary process remains transparent, independent and effective. The Committee also considers that publishing this decision helps to set industry standards and that is in the public interest.

Signed

Marjorie Noble

Date: 20 December 2017

Appendix 1: Relevant provisions

The Real Estate Agents Act 2008 provides:

79 Procedure on receipt of complaint

(1) As soon as practicable after receiving a complaint concerning a licensee, a Committee must consider the complaint and determine whether to inquire into it.

(2) The Committee may—

(a) determine that the complaint alleges neither unsatisfactory conduct nor misconduct and dismiss it accordingly:

(b) determine that the complaint discloses only an inconsequential matter, and for this reason need not be pursued:

(c) determine that the complaint is frivolous or vexatious and not made in good faith, and for this reason need not be pursued:

(d) determine that the complaint should be referred to another agency, and refer it accordingly:

(e) determine to inquire into the complaint.

89 Power of Committee to determine complaint or allegation

(1) A Committee may make 1 or more of the determinations described in subsection (2) after both inquiring into a complaint or allegation and conducting a hearing with regard to that complaint or allegation.

(2) The determinations that the Committee may make are as follows:

(a) a determination that the complaint or allegation be considered by the

Disciplinary Tribunal:

(b) a determination that it has been proved, on the balance of probabilities, that the licensee has engaged in unsatisfactory conduct:

(c) a determination that the Committee take no further action with regard to the complaint or allegation or any issue involved in the complaint or allegation.

(3) Nothing in this section limits the power of the Committee to make, at any time, a decision under section 80 with regard to a complaint.

111 Appeal to Tribunal against determination by Committee

(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 the notice given under Section 81 or 94.

(2) The appeal is by way of written notice to the Tribunal of the appellant's intention to appeal, accompanied by—

(a) a copy of the notice given to the person under Section 81 or 94; and

(b) any other information that the appellant wishes the Tribunal to consider in relation to the appeal.

(3) The appeal is by way of rehearing.

(4) After considering the appeal, the Tribunal may confirm, reverse, or modify the determination of the Committee.

(5) If the Tribunal reverses or modifies a determination of the Committee, it may exercise any of the powers that the Committee could have exercised.

The relevant provisions from the Real Estate Agents Act (Professional Conduct and Client Care) Rules

2012 are:

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

Rule 6.4 A licensee must not mislead a customer or client, nor provide false information, nor withhold information that should by law or in fairness be provided to a customer or client.