Parmar - Complaint No C50630 [2023] NZREAA 105 (18 December 2023)

Last Updated: 13 July 2024

BEFORE THE COMPLAINTS ASSESSMENT COMMITTEE

Committee: CAC2204

Complaint: C50630

A complaint under section 74 of the Real Estate Agents Act 2008 by The Complainants

against Kirndip Parmar 20058826

and Licensee 2 XXXXXXXX

DECISION OF THE COMMITTEE

Dated 18 December 2023

COMPLAINTS ASSESSMENT COMMITTEE

Chairperson: Denise Evans

Deputy Chairperson: Belinda Moss

Panel Member: Julian Twiss

V202307

HOW THE COMPLAINT AROSE

1. This complaint is about the sale of a residential property for the Complainants, The Complainants by Licensee 1, Kirndip Parmar.
   
2. The complaint has arisen because Licensee 1 gave the key of the Property to the Buyer the day before settlement and before the sale money was paid, without asking or informing the Complainants, thereby allowing the buyers to access the Property before the sale money was paid.
   
3. Licensee 2, Licensee 2, was Licensee 1’s supervisor at the time of the sale.
   

THE COMPLAINT

4. Against this background, The Complainants complain that:
   
   1. At around 9am on the morning of settlement, before the sale money had been paid and before settlement had occurred, the Complainants’ arrived at the Property and were shocked to find the Buyer there vacuuming. They say it was a huge worry in the following hours until their lawyer confirmed the money had been paid just after midday, and it could have compromised safety or uncovered insurance issues.
      
   2. They signed a legal contract for the sale of their house with the Agency. They say it was a promise of the Agency to keep the house safe, including keeping the keys safe, only allowing entry with an authorised agent, and only releasing the keys to the buyer when

their lawyer confirmed that the sale money had been received. They feel that to hand over their keys a day early was a huge breach of trust and of contract.

100. Licensee 2 brushed off their concerns when they raised the issue with him.
     

THE ISSUES

5. The Committee identified the following issues:
   
   1. Whether Licensee 1 gave the keys of the Property to the buyer on the day before settlement in breach of his obligations as a licensee?
      
   2. Did Licensee 2 deal fairly with the Complainants' concerns after the issue arose concerning the keys?
      

THE COMMITTEE HAS CONSIDERED THE ISSUES

6. Issue one: Whether Licensee 1 gave the keys of the Property to the buyers on the day before settlement in breach of his obligations as a licensee?

1. There is no dispute that Licensee 1 gave the keys to the Buyers the day before settlement.

Licensee 1 acknowledges he did this. He also acknowledges that this was a mistake. By way of explanation, but not mitigation, he says the Purchasers asked him if they could access the Property before their movers arrived on settlement day to clean. He was just recovering from Covid and made the mistake of thinking it was acceptable to let the Purchasers access the Property.

2. The Purchasers had previously asked the Vendor’s lawyer, through their lawyer, for the keys ahead of settlement, but this request was declined by the lawyer. A similar request made to the Complainants to allow access for a plumber before settlement had been declined by

them because of concerns with insurance.

100. The Committee has referred to Rules 5.1 (skill and care), 9.1 (client’s best interests) and 9.5 (security). In summary, these Rules say that a licensee must exercise skill, care, competence, and diligence at all times when carrying out real estate agency work. They must act in the

clients’ best interests in accordance with their instructions. They must also take due care to ensure the security of the property and avoid risks of damage that may arise from customers accessing the property.

4. The Committee agrees with Licensee 1 that it was wrong for him to give the keys to the Buyer the day before settlement and finds that this amounts to unsatisfactory conduct pursuant to Rules 5.1, 9.1 and 9.5 of the Rules.
   

7. Issue two: Did Licensee 2 deal fairly with the Complainants’ concerns after the issue arose concerning the keys?

5. Licensee 2 is Licensee 1’s Supervisor. When the Complainants discovered the Buyer at the Property, they called their lawyer who sent an email to Licensee 2 at 11.59am. He says he was out of the office and didn’t see the email until approximately 1.30pm. He responded at approximately 1.45pm by calling Licensee 1 and at approximately 2pm he called the

Complainants’ lawyer and asked what he could do. The Complainants’ lawyer suggested he call the Complainants to apologise, which he did immediately at approximately 2.15pm and says he spoke to them for about 10 minutes.

6. The Complainants say Licensee 2 brushed off their concerns without acknowledging their shock at what had happened, the breach of contract or the potential issues that could have arisen.
   
7. Licensee 2 says the Complainants expected him to dismiss Licensee 1 because of the

transgression, which he told them he would not do because while Licensee 1’s action was a serious lack of judgment, it was an isolated case.

8. The Committee has considered Rules 5.1 (skill and care) in relation to Licensee 2’s response to the Complainants. It finds that Licensee 2 realised the seriousness of the issue and

responded as quickly as possible. The Committee appreciates that the situation was stressful for the Complainants but agrees that Licensee 2 dealt fairly with the matter on the day.

1. The Committee has decided to take no further action on this issue.
   

THE OUTCOME

8. The Committee has made the following findings:
   
   1. Unsatisfactory conduct will be taken in relation to the complaint against Kirndip Parmar under s89(2)(b) of the Act.
      
   2. No further action in relation to the complaint against Licensee 2 under s89(2)(b) of the Act.
      

PROVISIONS OF THE ACT AND RULES REFERRED TO

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

REQUEST FOR SUBMISSIONS ON ORDERS

10. The Complainants are to file submissions (if any) on what orders should be made within ten working days from the date of notice of this decision. These submissions, if any, will then be provided to Kirndip Parmar, with a timeframe for filing final submissions.
    
11. The Committee requires the Compliance Case Coordinator to obtain a record of any previous

disciplinary decision in respect of Kirndip Parmar and, if any such decision exists, provide it to the Committee.

12. The Committee will consider all submissions and issue a decision on orders for Kirndip Parmar.
    

PUBLICATION

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

RIGHT TO APPEAL

11. A person affected by the Committee’s decision in respect of Kirndip Parmar may appeal to the Real Estate Agents Disciplinary Tribunal (the Tribunal) within 20 working days after the day the

Committee gives notice of its decision on orders, if any.

12. If you are affected by the Committee’s decision in respect of Licensee 2, your right to appeal to

the Tribunal is set out in section 111 of the Act. You may appeal in writing to 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 a 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.

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

estate-agents/apply/.

Signed

Chairperson: Denise Evans

Deputy Chairperson: Belinda Moss

Panel Member: Julian Twiss

Date: 18 December 2023

APPENDIX: PROVISIONS OF THE ACT AND RULES REFERRED TO

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.

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.

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 or its business (including any records, accounts, and assets) available for inspection or take advice in relation to management from persons specified in the order;

(ha) if the Committee is satisfied that the unsatisfactory conduct involves more than a minor or technical breach of this Act or of any regulations or rules made under this Act, make an order referring the matter to the Disciplinary Tribunal for the Tribunal to consider whether to make a compensation order under section 110(5);

(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.

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:

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

Rule 9.1: A licensee must act in the best interests of a client and act in accordance with the client’s instructions unless to do so would be contrary to law.

Rule 9.5: A licensee must take due care to—

(a) ensure the security of land and every business in respect of which the licensee is carrying out real estate agency work; and
(b) avoid risks of damage that may arise from customers, or clients that are not the owner of the land or business, accessing the land or business.