Complaint No C18097 [2017] NZREAA 243 (18 September 2017)

Last Updated: 27 November 2019

Before the Complaints Assessment Committee

Complaint No: C18097

In the matter of

Part 4 of the Real Estate Agents Act 2008

The Licensee: The Licensee (XXXXXXXX)

Decision finding of unsatisfactory conduct - asking for submissions on orders

18 September 2017

Members of Complaints Assessment Committee: CAC 414

Chairperson: Marjorie Noble

Deputy Chairperson: Susan D’Ath

Complaints Assessment Committee

Decision finding unsatisfactory conduct - asking for submissions on orders

1. The Complaint

1.1. On 7 December 2016 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) and at the time of conduct was engaged by the Agency.

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

1.4. The details of the complaint are that when information was requested from the Body Corporate for the Property, the Licensee sent selective correspondence to her, so much so that she was misled and believed she had permission to have her dog at the Property.

1.5. In particular, the Complainant advised that:

1. As a result of not receiving all the information, she has had to re-home her pet and is reconsidering her options.
   

1.6. The Complainant requested a remedy, being:

1. That the Licensee be held accountable financially by paying for the agency fees that she will incur once she sells the Property through the Agency.
   

1.7. The Licensee responded to the complaint against him.

1.8. In particular, the Licensee commented that

1. Some material was not disclosed to the Complainant on the basis it was a private communication for his attention only.
   

b) There was no dishonest withholding of information and all material from the Body

Corporate was supplied to the Complainant.

2. What we decided

2.1. On 27 March 2017 the Complaints Assessment Committee (the Committee) considered the complaint and decided to inquire into it under section 79(2)(e) of the Act.

2.2. On 14 August 2017 the Committee held a hearing on the papers and considered all the information that had been gathered during the inquiry.

2.3. The Committee found the Licensee had engaged in unsatisfactory conduct under section

89(2)(b) of the Act. The decision was also made with reference to the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2012, in particular Rule 5.1 (skill, care and competence), Rule 6.2 (act in good faith), and Rule 6.4 (must not mislead, provide false information or withhold information).

3. Our reasons for the decision

3.1. The Committee found, pursuant to section 72(a) of the Act, that the Licensee’s actions fell short of the standard that a reasonable member of the public is entitled to expect from a reasonably competent licensee.

The Complainant had asked the Licensee for help to clear her old dog with the Body

Corporate

3.2. The Complainant specifically sought the assistance of the Licensee to guide her through the tender process. The Complainant had also made the Licensee very aware of how important it was to her for permission for her dog to reside with her at the Property be granted. In an email to the Licensee dated 19th September 2016 the Complainant asked the Licensee to clear her old dog with the body corp.

3.3. The Committee agreed that the Licensee was then obligated to assist the Complainant with a suitable conditional clause in her tender document concerning the pet’s approval. The Licensee supplied the Body Corporate rules and copies of the answers to the specific questions asked of the Body Corporate, but the statement by the Body Corporate Chairman that he could be approached once a conditional offer was signed for pet approval was not shared with the Complainant. The Licensee allowed the Complainant to make an unconditional offer to purchase the Property.

3.4. This is an unfortunate situation where the Complainant, who believed she had approval for her dog, has been forced to apply in retrospect for this. Unfortunately, permission was not granted for the dog due to the noise the dog had exhibited whilst living at the Property. The Complainant’s assessment of the suitability of her dog to meet the Body Corporate rules was incorrect and it is likely she would have found herself in this same situation had the proper process been followed. This does not change the fact that the Licensee breached Rules 5.1 and

6.2 when he ignored her request for assistance to gain approval for her dog. A conditional

clause was clearly required in the Complainant’s tender and then, since the Body Corporate preferred to not deal directly with the Complainant at this stage of the process, the Licensee should have provided guidance to the Complainant to gain approval for her dog to satisfy the condition surrounding this. It is possible the dog may not have been granted approval and then the Complainant would not now have to consider re-homing her pet and/or selling her property.

3.5. The Committee considered that merely providing some information on the process but no assistance when it came to the insertion of an appropriate clause in the tender was not acceptable conduct by the Licensee, and therefore a finding of unsatisfactory conduct is appropriate in the circumstances.

Information missing from emails supplied to Complainant

3.6. The Licensee did not supply the full emails from the Body Corporate Chairman to the Complainant. It is understandable that the Body Corporate Chairman did not want to engage personally with the Complainant until a signed offer was in hand. However, the Complainant was not made aware of the process suggested by the Chairman to make a conditional offer and then apply for pet approval. The Committee found this to be a breach of Rule 6.4 which was to have serious consequences for the Complainant.

4. Request for submissions on orders

4.1. The Complainant is to file submissions (if any) on what orders should be made within ten working days (by 2 October 2017) from the date of notice of this decision. These submissions, if any, will then be provided to the Licensee, with a timeframe for filing final submissions.

4.2. The Committee requires the Case Administrator to obtain a record of any previous disciplinary decision in respect of the Licensee and, if any such decision exists, provide it to the Committee.

5. What happens next

5.1. The Committee will conduct a separate hearing on the papers to consider all submissions and

issue a decision on orders if any, under section 93 of the Act. Refer to the Appendix of this decision.

6. Your right to appeal

6.1. The Committee considers 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.

7. Publication

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

Signed

Marjorie Noble

Date: 18 September 2017

Appendix: Relevant provisions

The Real Estate Agents Act 2008 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.

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.

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.

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 6.2 A licensee must act in good faith and deal fairly with all parties engaged in a transaction.

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.