Complaint No C40489 [2022] NZREAA 63 (30 May 2022)

Last Updated: 4 May 2023

Before the Complaints Assessment Committee
In the matter of	Complaint No: C40489 Part 4 of the Real Estate Agents Act 2008
and
Licensee 1:	Licensee 1 (xxxxxxxx)
Licensee 2:	Licensee 2 (xxxxxxxx)

Decision to take no further action

30 May 2022

Members of Complaints Assessment Committee: 2108 Chairperson: Andrew Hayes

Deputy Chairperson: Denise Evans Panel Member: Ian Keightley

V20200813

Complaints Assessment Committee

Decision to take no further action

1. The Complaint

1.1. On 14 January 2021 the Real Estate Agents Authority (the Authority) received a complaint against Licensee 1 and Licensee 2 from the Vendors. Vendor 2 is Vendor 1’s daughter.

1.2. Licensee 1 is a licensed Branch Manager under the Real Estate Agents Act 2008 (the Act) and Licensee 2 is a licensed Agent and was one of 2 listing agents.

1.3. The complaint relates to a property situated at The Property.

1.4. The details of the complaint are that the Licensee 1 (being a related person under s134 of the Act) purchased the Property at auction on 10 December 2020 (with settlement on 22 December 2020) and then very shortly thereafter (19 December 2020) on sold it for more than he purchased it for, with the Vendors having very little notice of Licensee 1’s intent to purchase the Property.

1.5. The issues the Committee enquired into were whether:

• (a) Licensee 1 worked in the Vendors’ best interests by on selling the Property within a few days to the underbidder.
  
• (b) Licensee 2 met the requirements when preparing the CMA and whether the CMA gave information which realistically reflected current market conditions.
  
• (c) Licensee 2 acted appropriately by requesting that Vendor 1, who was 83 years old, review and sign Form 2 shortly before the auction began, without giving him sufficient opportunity to seek independent or other advice.
  
• (d) Licensee 2 met requirements when completing Form 2 when providing the provisional value as he did not obtain agreement and signatures of all parties with the authority to sell.
  

1.6 In particular, the Vendors, through Vendor 2, said:

• (a) The Property was sold by Vendor 1.
  
• (b) It was held by the Trust .
  
• (c) The Complainant, Vendor 1, is an “advisory Trustee” to the The Trust.
  
• (d) Licensee 2 did not meet the requirements when preparing the CMA which did not reflect current market conditions.
  
• (e) Vendor 2 was not present at the auction as she resided in Location A. She was contacted by phone before the auction and the signing of Form 2 and sale and purchase agreement. She did not see any documentation until after it was executed and sent to her. Vendor 2 observed the auction online via videoconference.

• (f) Just prior to the auction commencing Licensee 2 advised Vendor 2 by telephone that Licensee 1 wished to bid on the Property.
  
  • (g) Vendor 1 was taken aside, without his support person, to sign the Form 2.
    
  • (h) Only Vendor 1 signed the Form 2.
    
  • (i) There was no opportunity to seek legal advice prior to Form 2 being signed.
    
  • (j) The Form 2 provided a “provisional value” of $415,000, but the basis for that valuation was not provided.
    
  • (k) Licensee 1 purchased the Property at the auction for $420,000.00
    
  • (l) The Property settled on 22 December 2020.
    
  • (m) The Property was relisted by Licensee 1 on 16 December 2020 and later advertised by an Agency on websites for $19,000 higher than the purchase price.
    
  • (n) The underbidder at the auction acquired the Property from Licensee 1 in a private sale for $423,000.
    

1.7. The Vendors requested a remedy, being:

• (a) An investigation into whether the Real Estate Industry’s standards had been complied with, and
  

(b) If not, the Licensees be censured.

• 1.8. The Licensees responded to the complaint against them.
  
• 1.9. In particular Licensee 1 said:
  
  • (a) He has a holiday home in Location B and has known the owner of the Property (Vendor
    1. for 45 years through a friend.
       
  • (b) He thinks he viewed the Property during the first week of marketing. It was of some interest to him, but he forgot about it until auction day.
    
  • (c) He had a basic plan to do some alterations to it and keep it as a rental investment.
    
  • (d) On auction day he definitely spoke to Licensee 2 (and maybe the co-listing agent also) expressing his lukewarm interest on bidding for the Property. He asked Licensee 2, to tell Vendor 1 of this and see if he was ok with him bidding. If Vendor 1 was okay with that Licensee 2 was to organize the execution of the Form 2 prior to the auction of the Property starting. He is sure of this because he was acutely aware of the consequences of not having the Form 2 properly completed if he was the successful bidder.
    
  • (e) He was the successful bidder at $420,000 on 10 December 2020.

• (f) He was unaware that the reserve price was for the Property had been set at $420,000 at the time of the auction.
  • (g) On 15th December 2020 he met an architect at the Property and after discussion decided it was no longer economical to proceed with his plan to undertake alterations and have it as a rental investment.
    
  • (h) He had also received a lower than he expected rental assessment confirmation the same day.
    
  • (i) Given these two negative pieces of information he decided to on sell the Property as quickly as he had decided to purchase the Property.
    
  • (j) It was placed on the market at $439,000 to cover costs totaling $431,800 (including purchase price of $420,000 solicitor fee, resale fee, architect, valuation and holding costs).
    
  • (k) He asked the co listing agent to see if he underbidder was still in the market and if so, to arrange negotiations.
    
  • (l) Upon the resale of the Property to the underbidder for $423,000 after deducting expenses incurred for it, his actual loss on that resale was $9,800.
    
  • (m) It had not been his intention to resell the Property at the time he purchased it.
    
  • (n) Vendor 1 was happy with the price he achieved at the auction and has not expressed any dissatisfaction with that to him since then. This complaint, in his view, has been driven by Vendor 2 without full knowledge or all the facts.
  
  
  • 1.10. The investigation included receiving comments from the underbidder who purchased the Property. In particular the underbidder said:
    
    • (a) She was told the Property would sell in the $300,000’s to early $400,000’s.
      
    • (b) Due to an issue with title, which her lawyer said would cost $20,000 to remedy, she did not confirm her intention to bid until the day of the auction.
      
    • (c) She attended the auction in Location C with her sister-in-law and was initially the only bidder.
      
    • (d) A new bidder bid against her and eventually he got to $420,000. She had decided to go no further.

• (e) She was unaware at the time the other bidder was with the Vendors’ agency but learnt this when she was approached a week after the auction about any continued interest in buying the Property she may have.
  • (f) After negotiations she agreed to buy the Property for $423,000.
  
  
  • 1.11. In particular, the Licensee 2 said:
    
    • (a) He was the listing agent for the Property. The co Listing Agent assisted him with this sale.
      
    • (b) Vendor 2 was taken off the Trust on 13 March 2019.
      
    • (c) The listing agreement for the Property was signed by Vendor 1 only. It listed the client as the Trust and Vendor 1. It was executed by Vendor 1 with the acknowledgement that he has full authority to enter into the listing agreement on behalf of the Trust.
      
    • (d) He had been advised by Vendor 1 and Vendor 1’s lawyer and Vendor 2, that Vendor 1’s signature was sufficient to bind the Trust.
      
    • (e) The sale and purchase agreement was signed by Vendor 1 alone. Vendor 1’s lawyer did not require any further signatures to that agreement.
      
    • (f) He prepared the CMA for the Property. It gave his opinion that the Property was likely to sell for between $195,000 and $334,000. A high possible sale price of $495,000 was indicated. The three sales in the report range between $170,000 and $500,000.
      
    • (g) He noted in the CMA this range is a computer prediction which had been affected by including the historic sales of units one (18 December 2019, $500,000) and three (19 December 2016, $220,000).
      
    • (h) The range indicated in the agency agreement ($395,000 to $460,000) was discussed at length with Vendor 1. He told Vendor 1 he thought in his opinion a sale around $440,000 was possible.
      
    • (i) The auction didn’t fire and $420,000 was achieved on the day.
      
    • (j) Throughout the sale process he dealt principally and primarily with Vendor 1. Vendor 1 was adamant that no other decision makers were involved, and he alone was the sole arbitrator of any outcome with respect of the auction, although Vendor 2 was kept fully informed and insisted on being “in” on all decisions.
      
    • (k) Vendor 1 set the auction reserve price. Vendor 2 was on the phone while Vendor 1 set the reserve.
      
    • (l) Vendor 2 was happy with the auction price at the conclusion of the auction and aware that Licensee 1 was the purchaser.
      
    • (m) He was only aware of Licensee 1’s interest in bidding for the Property on the day of the auction (on which many other properties were also being auctioned) and only very shortly before the auction for the Property commenced. He was aware that the Form 2 process would therefore need to be undertaken.

• (n) As Licensee 1 had only recently notified him of an interest to bid there was very limited time to complete the Form 2 process.
  • (o) He explained to Vendor 1 and Vendor 2 (on the phone) that it was a legal obligation under the REAA for a purchaser within the Agency to provide a Form 2 and subsequently within 14 days a registered valuation had to be obtained by Licensee 1 and also the rights they had of cancellation once the valuation was received.
    
  • (p) He understood they were both satisfied with his explanation of Form 2.
    
  • (q) They were pleased to have another bidder in play and stressed that day they wanted the place sold.
    
  • (r) The other bidder had told him she was factoring in $20,000 cost for a title remedy requirement as advised by her lawyer.
    
  • (s) He knew that Vendor 1 was at the auction with his friend. He was not described as a support person to him. This description of his friend as a support person appeared for the first time in the complaint filed by Vendor 2.
    
  • (t) In accordance with the Form 2 process an independent valuation was prepared by Company A and provided to Vendor 1 within the prescribed time frame. That valuation valued the Property (as of 16 December 2020) at $420,000.00.
    
  
  
  • 1.12. The investigation included receiving comments from Vendor 1’s friend who attended the auction with him. In particular the friend said:
    
    • (a) He was introduced to Licensee 2 as a friend and not a support person.
      
    • (b) He was there basically to hold Vendor 1’s hand.
      
    • (c) He recalls before the auction Vendor 1 went round the back, without him, but does not know why.
      
    • (d) He clearly recalls before the hammer fell Vendor 1 was approached by Licensee 2 and handed a form.
      
    • (e) There were 2 bidders. He knew the second bidder was an Agency Principal.
      
  • 1.13. The investigation included an interview with the co listing agent, Licensee 2’s assistant. In particular the co listing agent said:
    
    • (a) Licensee 2 is the lead agent in their business relationship who has contact with the clients. He carries out other tasks such as arranging photographs.
      
    • (b) He attended the 11:30am reserve set meeting with the Auctioneer, Licensee 2 and Vendor 1. Vendor 2 attended by telephone.
      
    • (c) He attended the auction at 12 noon. The auction of the Property was at least an hour or more after the reserve meeting.

• (d) Vendor 1 was at the auction with another person. He had previously met that person at the Property and was unaware that he attended the auction in any capacity other than to be there with Vendor 1.
  • (e) There were few buyers who went through the Property and the only one who showed interest turned up to the auction.
    
  • (f) He was generally unsure as to the timing of occurrences at the auction given the passage of time.
    
  • (g) He recalled that Licensee 2 may have mentioned to him Licensee 1 may be interested before the start of the auction. He is not sure.
    
  • (h) He recalled after the hammer fell but, before Vendor 1 signed the sale agreement, he and Licensee 2 presented and explained to Vendor 1 the Form 2 which he had just prepared.
    
  • (i) As he had no prior knowledge of Licensee 1’s interest there was no opportunity to complete the form earlier.
    
  • (j) Unfortunately, in the heat of the moment he mistakenly inserted $415,000 in the Form 2 as the provisional valuation figure believing that had been the sale price. His intention was to have the actual sale price as the provisional valuation figure.
    
  • (k) Vendor 1 was very happy with the outcome of the auction. At the reserve meeting Vendor 1 had been prepared to set a reserve price lower than $420,000 but he and Licensee 2 had advised him to set it at $420,000. He understood Vendor 1 no longer wanted the Property and would have accepted $412,000 for it.
    
  • (l) After the auction he asked Licensee 1 why he had bought it. The response was Licensee 1 was looking for a rental.
    
  • (m) He is aware that after the auction Licensee 1 had an architect in who advised the Property was dated, not up to the current rental codes and was going to cost a lot of money to do up.
  
  
  • 1.14. The investigation included receiving a statement from the auctioneer, Individual A. In particular he said:
    
    • (a) He dealt principally and primarily with Vendor 1 as he was adamant that there were no other decision makers involved and he would be the sole determinant of any outcome with respect of the auction.
      
    • (b) The reserve meeting was held at 11:30 am with Vendor 1. Vendor 2 attended that reserve setting meeting by phone and was kept fully informed “as she insisted in being “in” on all decisions including the reserve set.”.
      
    • (c) The Reserve Set Form was signed by Vendor 1 which included his warrantee that he had full authority of the vendor.

• (d) He was advised of Licensee 1’s interest in the Property only late that morning.
  • (e) A Form 2 was prepared and after explanation with Vendor 1 and was executed by Vendor 1.
    
  • (f) The auction for the Property was conducted by him at approximately 2:30pm.
    
  • (g) As to the auction there were only 2 bidders with bidding ceasing at $420,000. The auction was paused for him to take further instructions from Vendor 1.
    
  • (h) Vendor 1 stated he was very pleased with the outcome and on his confirming instructions he went back to the auction room and reopened the bidding. As there were no further bids received, he declared the Property sold for $420,000 to Licensee 1.
    
  
  

2. What we decided

2.1. On 21 June 2021 the Complaints Assessment Committee 2001 considered the complaint and decided to inquire into it under section 79(2)(e) of the Act.

2.2. On 24 June 2021 the complaint was transferred to Complaints Assessment Committee 2108 (the Committee).

2.3. On 7 December 2021 the Committee held a hearing on the papers and considered all the information gathered during the inquiry.

2.4. Although the complaint alleges conduct which could be capable of being unsatisfactory conduct , in this case the Committee has found that it was not and the Real Estate Industry’s standards had been complied with and 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 made with reference section 72 of the Act and also with reference to the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2012, namely rules 6.1, 6.2, 6.4, 9.2, 9.3, 9.7, 10.2 and 10.3

3. Our reasons for the decision

Did Licensee 1 act in the Vendors best interests by on selling the Property to the underbidder?

3.1. The Committee accepts Licensee 1 purchased the Property in good faith at auction and had no intention to on sell it at that time. He purchased the Property on impulse and later, after further investigation as to renovation feasibility and rental income, regretted that decision and decided to immediately on sell it to minimize his losses. It also accepts that Licensee 1 resold the Property at a loss when taking into account the expenses incurred.

3.2. Licensees 1’s explanation of the circumstances of his purchase and quick resale are logical and supported by:

• (a) his immediate actions after he was the successful bidder at auction; investigation the feasibility of his impulsive plans for the Property, deciding they were uneconomic and onselling.
  
• (b) the only very slight increase in the two sale prices ($3,000).
  
• (c) the effective loss Licensee 1 made of the onsale.

• (d) the underbidders confirmation that she would not have met Licensee 1’s winning bid at auction due to, amongst other things, the advice she received as to an issue with the title and that the identity and position of her vendor, Licensee 1, at the agency was disclosed to her.
  

3.3. It is more likely than not that without Licensee 1’s bid the Vendors would not have received the purchase price of $420,000 which they did, but a lesser amount. It was in the Vendors interest that he was the successful bidder on the day. On the day, the underbidder was not willing to meet the auction sale price. That the underbidder was willing to increase the purchase amount by $3,000 later, after missing out at the auction, does not impact on what the Vendors could have achieved on auction day.

3.4. Accordingly, the Committee is satisfied that no breach of acceptable conduct arises from Licensee 1 successfully bidding at the auction then on selling the Property (at a loss) shortly thereafter to the underbidder. The Real Estate Industry’s standards had been complied with.

Adequacy of Licensee 2’s CMA?

3.5. Rules 10.2 and 10.3 set out the requirements when completing a CMA. Particularly that it should realistically reflect the current market conditions and be supported by comparable information on sales of similar land in similar locations.

3.6. The CMA is comprehensive and thorough. The sale price achieved at auction and the resale and the post auction independent valuation all fall within its reasonable parameters.

3.7. The Vendors’/Vendor 2’s concern that the CMA was not properly completed and did not reflect current market conditions is unsupported by the evidence before the Committee.
3.8. The Committee finds that the CMA meets the above requirements and is in accordance with the agent’s obligations under the Act and the Rules.

The circumstances surrounding the signing of the form 2 on Auction day

The Form 2 process is required so as to provide protection to vendors when associated persons purchase their property by way of proper disclosure, the registered valuation requirement and vendors option to void the contract.

Exclusion of Support person?

3.9. Vendor 2’s concern that Vendor 1’s friend was not involved in the Form 2 process as he was there as a support person is unsubstantiated. The Committee say that as:

• (a) His friend was introduced to Licensee 2 as a friend and not a support person.
  
• (b) His friend did not consider himself being there in the role of a support person.
  
• (c) Vendor 1 was free to take his friend with him to the explanation of the Form 2. He chose not to.
  
• (d) Vendor 2 participated in the explanation of the Form 2. No objection to the absence of the “support person” by her at that time.
  
• (e) There is nothing to suggest Vendor 1 needed his friend to be present as a support person.

3.10. No conduct issue arises out of this head of complaint.

Available time and opportunity to take other advice?

3.11. The Committee accepts that Licensee 1 only decided to possibly bid on auction day and this information was only provided to Licensee 2 very shortly before the auction commenced. It was in the interests of the Vendors that Licensee 1 took part in the auction as a bona fide potential purchaser. The Committee also finds that before the auction commenced, Vendor 1 and Vendor 2, on a fully informed basis, consented to Licensee 1’s participation, and they were happy with his involvement in the bidding process.

3.12. Given that short period of time available and the full explanation of the Form 2 process given by Licensee 2, the Committee is satisfied that the Form 2 was appropriately executed.

3.13. The code of conduct notes specific documents that require a procedure around signing such as Agency Agreements, Sale and Purchase Agreements and any other contractual documents. This document is not a contractual document, it is a consent form. While it is vital that this information is understood and that the document is properly executed prior to the agreement, there is not a requirement in the Act or Code of Conduct to recommend professional advice prior to signing the consent form.

3.14. No conduct issue arises out of this head of complaint.

The adequate completion of Form 2: the provisional value and obtaining the agreement and signatures of those with authority to sell on it.

3.15. The Committee is satisfied that nothing turns upon the Form 2 recording a provisional value of

$415,000. This was merely an error by the co listing agent when completing the form due his mistaken belief that had been the sale price achieved rather than the actual price of $420,000.

3.16. Vendor 2 was concerned that there was no basis given for that provisional valuation figure. There is no requirement that a basis be given. It is only a “provisional” valuation. It is to be confirmed or otherwise by the completion of a registered valuation. The provisional valuation should be inherently reasonable, which it was, given the public auction price achieved, the on sale price and the registered valuation.

3.17. No conduct issue arises out of this head of complaint.

3.18. The Committee is satisfied that Vendor 1 had the requisite authority to execute the Form 2. It says that because:

• (a) He had solely signed all previous documentation for the Trust previously, including the listing agreement and the reserve set form.
  
• (b) He had soley signed the sale and purchase agreement.
  
• (c) He had advised that he had the authority to do so.
  
• (d) He had warranted in those documents that he had authority to do so.
  
• (e) That had not been challenged by Vendor 2 or his lawyer at the relevant times.
  

3.19. In those circumstances Licensee 2 was entitled to believe Vendor 1 that he was able to solely execute documentation for the Trust.

3.20. No conduct issue arises out of this head of 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 Property), the Licensee 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 and Rules referred to

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

Signed

Andrew Hayes Chairperson

Denise Evans

Deputy Chairperson

Ian Keightley Member

Date: 30 May 2022

Appendix: Provisions of the Act and Rules referred to

The Real Estate Agents Act 2008 provides:

78 Functions of Committees

The functions of each Committee are—

(a) to inquire into and investigate complaints made under section 74:
(b) on its own initiative, to inquire into and investigate allegations about any licensee:
(c) to promote, in appropriate cases, the resolution of complaints by negotiation, conciliation, or mediation:
(d) to make final determinations in relation to complaints, inquiries, or investigations:
(e) to lay, and prosecute, charges before the Disciplinary Tribunal:
(f) in appropriate cases, to refer the complaint to another agency:
(g) to inform the complainant and the person complained about of its decision, reasons for the decision, and appeal rights:
(h) to publish its decisions.

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 or 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 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.

The Rules from the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2012 referred to in this decision are:

6.1 A licensee must comply with fiduciary obligations to the licensee’s client.
6.2 A licensee must act in good faith and deal fairly with all parties engaged in a transaction.

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.

9.2 A licensee must not engage in any conduct that would put a prospective client, client, or customer under undue or unfair pressure.
9.3 A licensee must communicate regularly and in a timely manner and keep the client well informed of matters relevant to the client’s interest, unless

otherwise instructed by the client.

9.7 Before a prospective client, client, or customer signs an agency agreement, a sale and purchase agreement, or other contractual document, a licensee must—

• (a) recommend that the person seek legal advice; and
• (b) ensure that the person is aware that he or she can, and may need to, seek technical or other advice and information; and

• (c) allow that person a reasonable opportunity to obtain the advice referred to in paragraphs (a) and (b).

10.2 An appraisal of land or a business must—

• (a) be provided in writing to a client by a licensee; and
• (b) realistically reflect current market conditions; and
• (c) be supported by comparable information on sales of similar land in similar locations or businesses.