Complaint No C41584 [2021] NZREAA 73 (23 September 2021)

Last Updated: 21 November 2022

Before the Complaints Assessment Committee
In the matter of	Complaint No: C41584 Part 4 of the Real Estate Agents Act 2008
and
Licensee 1:	Licensee 1 (XXXXXXXX)
Licensee 2:	Licensee 2 (XXXXXXXX)
The Agency:	Agency 1 (XXXXXXXX)

Decision to take no action

23 September 2021

Members of Complaints Assessment Committee: CAC2106 Chairperson: Maria McElwee

Deputy Chairperson: Amanda Elliott Panel Member: Susanne Guhl

Complaints Assessment Committee

Decision to take no action

1. The Complaint

1.1. On 8 April 2021 the Real Estate Agents Authority (the Authority) received a complaint against Licensee 1, Licensee 2 (together, the Licensees) and Agency 1 from the Complainant.

1.2. Agency 1 is named as a party to this complaint. However, the evidence provided by the Complainant establishes that it was another Agent company, Agency 2 that was involved in the matters complained about.

1.3. Licensee 1 is a licensed Salesperson under the Real Estate Agents Act 2008 (the Act). Licensee 1 was employed by Agency 2 at the relevant time and, is currently employed by an agency

that is not a party to this complaint.

1.4. Licensee 2 is a licensed Agent under the Act. Licensee 2 was the eligible officer for Agency 2 at the relevant time and, is currently the eligible officer for Agency 1.

1.5. The complaint relates to two rural properties (together, the Properties).

1.6. The details of the complaint are that:

1. On 23 September 2003 the Complainant, along with his wife and his in-laws entered into two agreements for sale and purchase (the ASPs) to purchase the Properties.
   
2. The Properties were sold through Agency 2.
   

100. The Complainant says he paid a total of $85,000.00 as a deposit for the Properties.

$75,000.00 secured Property 1 and, the remaining $10,000.00 secured Property 2.

4. A dispute arose between the Complainant, his wife and his in-laws during the purchase of the Properties.
   
5. Agency 2 was aware that the ASPs were inter-dependent and were also aware that the Complainant would only proceed if he could buy both Properties. Agency 2 received a “cut” by way of commission by using the Complainant’s money and only going unconditional on Property 1 without the Complainant’s consent.
   
6. The Complainant says that he was told that if he withdrew from the transaction, they (Agency 2) would keep his deposit. The complainant says that this is a “technical theft”.
   
7. On 3 October 2003 Agency 2 was contacted by a lawyer (the Lawyer) acting on behalf of the Complainant’s mother-in-law. The Complainant says the Lawyer was not the

lawyer listed on the ASPs.

8. The Lawyer instructed Agency 2 to release $29,500.00 being the deposit for Property 2.
   
9. Agency 2 made a payment of $29,500.00 to the Lawyer on 10 November 2003. The Lawyer then deposited $29,500.00 into the Complainants mother-in- law’s bank account.
   
10. The Complainant says he was not asked and, did not give permission for the funds to be paid to his mother-in-law.

11. The Complainant also says that without the “dodgy” accounting from Agency 2 this would not have opened the door for future fraud. The Complainant has explained that the release of the $29,500.00 deposit for Property 2 meant that there were insufficient funds for the deposit on Property 1. The Complainant believes that Agency 2 was “a

willing party to theft and fraud”.

50. Property 1 was purchased by the Company. The Complainant says there was no

agreement for sale and purchase and, the Company was not a nominated purchaser. The Complainant asks for an explanation as to how the Company became the owner of Property 1.

1.7. The Complainant requested a remedy, being:

1. A refund of $29,500.00.
   
2. A determination as to whether Agency 1 acted correctly when releasing the deposit money.
   

1.8. The Licensees and Agency 1 were contacted by the Authority when this complaint was received.

1.9. Licensee 1 said because of the length of time that had elapsed she no longer holds any records that relate to the matter complained about.

1.10. Licensee 2 and Agency 1 say that they have also explained to the Complainant they no longer hold any records that relate to the matter complained about because of the length of time

that has elapsed.

2. What we decided

2.1. On 19 August 2021 the Complaints Assessment Committee (the Committee) considered all the information against the Licensee and decided to take no action on this complaint.

2.2. The decision was made under section 80(1)(a) of the Act.

3. Our reasons for the decision

3.1. The conduct complained of took place in 2003. Under section 172 of the Act the Committee may consider a complaint in respect of conduct alleged to have occurred before the

commencement of the Act (i.e. conduct occurring before 2008).

3.2. However, under section 80(1)(a) of the Act the Committee may decide to take no action on a complaint if, in the opinion of the Committee the length of time that has elapsed between

the date when the subject matter of the complaint arose and the date when the complaint was made is such that an investigation of the complaint is no longer practicable.

3.3. Agency 1 is named as a party to this complainant. However, Agency 1 was not licensed until 2009 and, was not involved in the transactions for the Properties. For this reason, no action can be taken against Agency 1.

3.4. The Complainant has provided evidence that indicates that $29,500.00 was paid by Agency 2 to the Lawyers trust account on 10 November 2003.

3.5. However, Agency 2 no longer holds an Agent company licence and was liquidated and

removed from the New Zealand Companies Register in 2011. Accordingly, no action can be taken against Agency 2.

3.6. The Complainant says that Licensee 1 managed the sale of the Properties and received a commission.

3.7. Licensee 1, Licensee 2 and Agency 1 advise that they do not hold any records that relate to the matter complained about.

3.8. The Committee must exercise its powers and perform its duties and functions in a way that is consistent with the rules of natural justice.1 Given the length of time that has elapsed

between the date of the alleged conduct and the date of the complaint the Committee has decided that an investigation of the complaint is no longer practicable and accordingly,

exercises its discretion under section 80(1)(a) of the Act to take no action on the complaint.

4. Publication

4.1. The Committee directs publication of its decision. This decision will be published without the names or identifying details of the Complainant (including the address of the Properties), the Licensees and any third parties.

4.2. 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.

4.3. 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.

5. Your right to appeal

5.1. If you are affected by this decision of the Committee, the right to appeal is set out in section 111 of the Act. You may appeal in writing to the Real Estate Agents Disciplinary Tribunal (the Tribunal) within 20 working days after the date notice is given of this decision. Your appeal must include a copy of this decision and any other information you wish the Tribunal to consider in relation to the appeal. The Tribunal has the discretion to accept a late appeal filed within 60 working days after the date notice is given of this decision, but only if it is

satisfied that exceptional circumstances prevented the appeal from being made in time.

5.2. The Notice of Appeal form, which includes information on filing an appeal, can be located on the Ministry of Justice’s website: https://www.justice.govt.nz/tribunals/real-estate-

agents/apply/.

6. Provisions of the Act referred to

6.1. The provisions of the Act referred to in this decision are set out in the Appendix.

1 Section 84(1) of the Act

Signed

Maria McElwee Chairperson

Amanda Elliott

Deputy Chairperson

Susanne Guhl Member

Date: 23 September 2021

Appendix: Provisions of the Act referred to

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.
  

80 Decision to take no action on complaint

(1) A Committee may, in its discretion, decide to take no action or, as the case may require, no further action on any complaint if, in the opinion of the Committee, —

• (a) the length of time that has elapsed between the date when the subject matter of the complaint arose and the date when the complaint was made is such that an investigation of the complaint is no longer practicable or desirable; or
• (b) the subject matter of the complaint is inconsequential.

(2) Despite anything in subsection (1), the Committee may, in its discretion, decide not to take any further action on a complaint if, in the course of the investigation of the complaint, it appears to the Committee that, having regard to all the circumstances of the case, any further action is unnecessary or inappropriate.

81 Notice of decision

(1) In any case where a Committee decides to take no action on a complaint, the Committee must promptly give written notice of that decision to—

• (a) the complainant; and
• (b) the person complained about.

(2) The notice must—

• (a) state the decision and the reasons for it; and
• (b) describe the right of appeal conferred by section 111.
  

84 Procedure of Committee

(1) A Committee must exercise its powers and perform its duties and functions in a way that is consistent with the rules of natural justice.

(2) The Committee may, subject to subsection (1), direct such publication of its decisions under sections 80, 89, and 93 as it considers necessary or desirable in the public interest.
(3) The Committee may regulate its procedure in any manner that it thinks fit as long as it is consistent with this Act and any regulations made under it.

111 Appeal to Tribunal against determination by Committee

(1) A person affected by a determination of a Committee may appeal to the Disciplinary Tribunal against the determination within 20 working days after the day on which

notice of the relevant decision was given under section 81 or 94, except that no appeal may be made against a determination under section 89(2)(a) that a complaint or an allegation be considered by the Disciplinary Tribunal.

(1A) The Disciplinary Tribunal may accept a late appeal no later than 60 working days after the day on which notice was given to the appellant if it is satisfied that exceptional

circumstances prevented the appeal from being made in time.

(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 (ab) the prescribed fee, if any; 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.

172 Allegations about conduct before commencement of this section

(1) A Complaints Assessment Committee may consider a complaint, and the Tribunal may hear a charge, against a licensee or a former licensee in respect of conduct alleged to have occurred before the commencement of this section but only if the Committee or the Tribunal is satisfied that, —

• (a) at the time of the occurrence of the conduct, the licensee or former licensee was licensed or approved under the Real Estate Agents Act 1976 and could have

been complained about or charged under that Act in respect of that conduct; and

(b) the licensee or former licensee has not been dealt with under the Real Estate

Agents Act 1976 in respect of that conduct.

(2) If, after investigating a complaint or hearing a charge of the kind referred to in

subsection (1), the Committee or Tribunal finds the licensee or former licensee guilty of unsatisfactory conduct or of misconduct in respect of conduct that occurred before the commencement of this section, the Committee or the Tribunal may not make, in

respect of that person and in respect of that conduct, any order in the nature of a penalty that could not have been made against that person at the time when the conduct occurred.