Complaint No C49917 [2023] NZREAA 71 (26 September 2023)

Last Updated: 9 April 2024

BEFORE THE COMPLAINTS ASSESSMENT COMMITTEE

Committee: CAC2204

Complaint: C49917

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

against The Licensee (XXXXXXXX)

DECISION OF THE COMMITTEE

Dated 26 September 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 Licensee’s use of a drone to take photos of a motel unit he was marketing. The published drone photos show The Complainant’s neighbouring property and he says his privacy was breached.
   

THE COMPLAINT

2. Against this background, The Complainant complains that:
   
   1. His privacy was breached because the drone photos showed his adjoining property.
      
   2. The Licensee was dismissive when he complained and told him the drone photography met regulations. The Licensee also claimed he had an exemption to take the photos.
      
   100. The Licensee was slow to eventually amend the advertisement photos so his property couldn’t be seen.
        

THE ISSUES

3. The Committee identified the following two issues:
   
   1. Whether The Licensee breached any professional obligations in relation to advertising the motel.
      
   2. Whether The Licensee breached any professional obligations in responding to the concerns raised and complaints made to REA.
      

CONSIDERATION OF THE ISSUES

4. The Committee has considered the two issues:
   

Issue One: Whether The Licensee breached any professional obligations in relation to advertising the motel.

The drone photography

5. The Licensee contracted a drone operator to take aerial marketing photos of the motel he was selling. Drone operation is regulated by the CAA. While making his complaint, the

Complainant contacted the CAA, which found that the drone operator had breached Part 101 of the applicable rules,1 specifically failing to log his flight plan on New Zealand Controlled

Airspace Application. As a result of the breach of the CAA rules, according to the

Complainant, the drone operator asked the Licensee to remove the photos he took to market the motel.

6. It appears from what the Committee has seen that the Licensee removed some of the photos, and had others altered so the complainant’s property was blacked out, thereby addressing the Complainant’s concern. However, the Committee notes that this was done after the Complainant complained to the Authority.
   
7. Regardless of any operator breaches, privacy is at the root of this issue. The aerial photography of an adjoining property has shown details of the Complainant’s property, and he feels his privacy is breached.
   
8. The Committee has considered how this compares to other publicly available aerial
   

1 https://www.aviation.govt.nz/rules/rule-part/show/101

photography, such as Google Earth that can clearly show aspects of property not normally visible from ground level, but notes that Google Earth photos are taken at an unspecified date and may be several years old while marketing photos are likely to be recent.

The Licensee’s professional obligations

9. Licensees do not have explicit professional obligations to the owners of neighbouring properties. However, there are general expectations that licensees act competently and lawfully.
   
10. Rule 5.2 of the Rules states that a licensee must have a sound knowledge of the Real Estate Agents Act, regulations, rules... and other legislation relevant to real estate agency work.
    
11. Licensees are also required to comply with the provisions of the Privacy Act 2020 which governs the collection and use of information. Furthermore, licensees are required to have a sound knowledge of the Privacy Act 2020, as it is relevant to real estate agency work.
    
12. The Committee is satisfied that the standard required of any licensee using photography whether taken by drone or otherwise is that a licensee must take all reasonable steps to ensure that the photographs do not impact the privacy of neighbouring property owners.
    
13. The Privacy Act 2020 requires that a person has a right to know that their information is being collected and the use to which that information will be put. Where a photograph

contains identifying information of a neighbouring property, the Committee considers that it is best practice for a licensee to get the permission of the owner of the neighbouring

property or to ensure that the neighbouring property is obscured or blurred so that the owner’s privacy is not impacted.

14. Rule 5.1 of the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2012 (the Rules) states that a licensee must exercise skill, care, competence, and diligence at all times when carrying out real estate agency work.
    
15. Section 72 of the Real Estate Agents Act 2008 (Act) states that a licensee is guilty of

unsatisfactory conduct if the licensee carries out real estate agency work that falls short of

the standard that a reasonable member of the public is entitled to expect from a reasonably competent licensee.

16. Rule 6.3 of the Rules states that a licensee must not engage in any conduct likely to bring the industry into disrepute.
    

What we decided

17. The Committee finds the Licensee did not have a sound knowledge of the Privacy Act. He said that he reviewed the Privacy Act when he received the complaint. Lack of knowledge of the Privacy Act is a technical breach of Rules 5.1 and 5.2 but does not reach the level of unsatisfactory conduct (s 72).
    
18. In relation to Rule 6.3, the Committee has seen no evidence that the Licensee has engaged in conduct likely to bring the industry into disrepute.
    
19. The Committee notes that the Agency’s rules apparently don’t allow for photography to be manipulated and that this is inconsistent with the requirements of the Privacy Act.
    
20. Accordingly, the Committee has decided to take no further action in relation to this issue.

Issue Two: Whether The Licensee breached any professional obligations in responding to the concerns raised and complaints made to REA.

The Licensee’s response to the Complainant

21. The Complainant saw the marketing photos that included his property and complained to the listing agent on 2 May 2022. The Licensee was aware of the complaint on 3 May 2022

and responded on 4 May by email stating he had done nothing wrong. The Licensee says he did extensive research before sending his email to check that he had not breached any

requirement. He referred to guidance from REINZ, including the Privacy Act and CAA rules and established that no rules had been breached. He also referred to the Agency’s rules that prohibited blurring marketing photography.

22. The Complainant made a complaint to the REA on 7 September after the CAA advised him on 25 August that the drone operator was in breach.
    
23. The Committee notes that although the Licensee responded promptly to the Complainant’s initial complaint (within 24 hours), the response did not address the Complainant's issue (loss of privacy) and focused on the requirements of drone photography. He stated in his

response that he had done nothing wrong but made no attempt at that stage to address the privacy concern.

24. The Complainant conducted his own investigation and contacted the Council and was told it did not issue consent for operating drones. So he contacted CAA which found the drone operator in breach of Part 101. The drone operator then asked the Licensee to remove the photos.
    
25. The Licensee says he removed some photos and blacked out the Complainant’s property.
    
26. Shortly after the complaint was made with REA, the motel was sold (on 8 September), and all photos were removed from the agency’s website.
    
27. The Licensee disputes some of the Complainant's claims, including that he said he had consent from the Council and CAA and that he had an exemption to obtain drone photography.
    
28. The Licensee also says he regrets not apologising to the Complainant but was distracted by the impact of flooding at that time, which affected him personally.
    

What we decided

29. The Committee has made a finding of no further action in relation to this issue because the Licensee’s actions regarding the photography are not real estate agency work in that the photography isn’t related to the real estate transaction. There is no evidence that The

Licensee breached any professional obligations in responding to the concerns raised and complaints made to the REA.

30. The Committee decided that The Licensee could have been more responsive to the

Complainant’s concern and taken immediate steps to alter or obscure the photographs. The committee accepts that The Licensee was distracted dealing with the flooding and damage to his property. However, it should not have been necessary for The Complainant to make a complaint at the Licensee’s office. Procedures should have made provision for ensuring compliance with the Privacy Act in these circumstances.

31. The Committee’s jurisdiction is limited to matters relating to real estate work, unless the conduct in question may be misconduct under s 73 of the Act, which is not the case in this situation. The Committee notes that this is an unusual situation where the complainant was not a party to the transaction. Section 4 of the Act defines real estate agency work as work done in trade for the purpose of bringing about a transaction. The conduct of the Licensee in responding to the Complainant was not connected to the transaction. The Committee also notes that the complaint management processes of licensees is only real estate agency work when it is sufficiently connected to the transaction, which again, is not the case in this

situation.

32. Therefore, the Committee has determined it does not have jurisdiction to make a finding regarding the conduct of the Licensee when responding to the Complainant’s complaint.

Accordingly, no further action should be taken in respect of this issue under s 89(2)(c) of the Act.

THE OUTCOME

33. The Committee has made the following finding:
    
34. No further action will be taken in relation to the complaint against The Licenseeunder s89(2)(c) of the Real Estate Agents Act 2008 (‘Act’).
    

PROVISIONS OF THE ACT AND RULES REFERRED TO

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

PUBLICATION

36. The Committee directs publication of its decision. The decision will be published without the names or identifying details of the Complainant (including the address of the Property), any

third parties and the Licensee.

RIGHT TO APPEAL

37. 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 Tribunal within 20 working days after the date notice is given of this decision.
    
38. 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.

39. 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: 26 September 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—

1. 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.

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 5.2: A licensee must have a sound knowledge of the Act, regulations, rules issued by the Authority (including these rules), and other legislation relevant to real estate agency work.

Rule 6.3: A licensee must not engage in any conduct likely to bring the industry into disrepute.