Ministry of Justice

Appeal / purchasers of residential property later discovered no legal vehicle access as driveway crossed a neighbouring property / licensees failed to identify and disclose access issue / Committee determined to take no further action, finding that reasonably competent licensee would not have been alerted to access issue / Real Estate Agents 2008, s111 / Professional Conduct and Client Care Rules 2012, r5.1 and r10.7 / HELD / licensee must “know what they are selling” but not expected to be solicitors, surveyors or building inspectors / obliged to disclose defects which are known or would appear “likely” or a “significant potential risk” / reasonably competent licensee would have identified significant risk posed by dual access to adjacent properties / fault apparent when documents considered alongside physical viewing of property / r5.1 and r10.7 breached / Committee’s decision reversed, finding of unsatisfactory conduct substituted against licensees / penalty decision to follow

Application to review Registrar’s determination not to pursue complaint as it only disclosed inconsequential matters / applicant vendor alleged licensee failed to disclose conflict of independent dealings with purchaser, failed to adequately market property and settle transaction, and pressured vendor to sell by disclosing purchaser’s personal circumstances / Real Estate Agents Act 2008, s74, s112 / Professional Conduct and Client Care Rules 2012, r6.1, r6.3, r6.4, r9.1, r9.2, r9.3, r9.4, r 9.14, r9.16 / HELD / no evidence of improper conflict management / licensee had advised applicant of interest in engaging with purchasers prior to ASP / subsequent dealings were independent / no evidence to support allegation of undue pressure / no evidence of breach of professional obligations in respect of sales price achieved / no evidence of substandard marketing or settlement papers / application dismissed / Registrar’s decision to take no further action confirmed

Penalty / managing director and agency guilty of misconduct under s73(c)(i) for failing to comply with s 85 notice / Real Estate Agents Act 2008, s3, s73ci, s85, s86, s93, s109A, s110 / Committee emailed director seven times, over eight months, requesting information required by to carry out the investigation into salesperson employed by agency / sustained failure to provide information / ensuring compliance with Act should have been foremost in licensee’s mind upon receiving s85 notice / subsequent improvements to regulatory processes considered / gravity of misconduct at mid-range licensees censured / director licensee fined $5,000, agency fined $10,000 / misconduct gave rise to reasonably incurred costs / no justification to depart from starting point of 50 per cent costs / licensees ordered to jointly pay $13,556.25 in costs

Penalty / misconduct and unsatisfactory conduct findings against licensee, their supervisor and  agency arising from failure to refund vendor-paid advertising (VPA) account balances / Real Estate Agents Act 2008, s3, s44, s72a, s73b, s73ciii, s110 /  Professional Rules 2012, r5.1, r6.1, r8.3, r8.4, r9.13 and r10.6c / HELD / licensee’s conduct at moderate to high level seriousness / no previous disciplinary history / cooperated with Committee / inadequate supervision / conduct continued over relatively lengthy period and was reckless / suspension not necessary / Tribunal ordered censure, training, and imposed $10,000 fine / supervisor and agency’s conduct at mid-range seriousness / no previous disciplinary history / cooperated with Committee / deficient practices leading to vendors being owed refunds & inadequate supervision / Tribunal ordered censure, vendor refunds, and imposed $7,500 fine each

Appeal / purchasers of residential property later discovered building work was previously undertaken without CCCs being obtained / purchasers complained about licensee’s alleged lack of disclosure / Registrar took no further action due to lack of evidence that licensee failed to disclose absence of CCCs / Real Estate Agents 2008, s111 / HELD / not in dispute that at time of purchase there were no CCCs for two building consents including original dwelling / mutually agreed that licensee sent LIM report to purchasers prior to auction / however, purchaser contended licensee did not disclose absence of CCCs / licensee contended absence of CCCs verbally disclosed during inspection / Tribunal noted unreliability of purchaser and licensee’s memories given effluxion of time / on balance, purchasers failed to discharge burden of proving factual basis of complaint / appeal dismissed / Registrar’s decision to take no further action confirmed

Liability / misconduct / managing director and agency charged under s73(c)(i) for failing to comply with s 85 notice / Real Estate Agents Act 2008, s3, s73, s85, s86, s109A, s110, s154 / High Court Rules 2016, r15.1 / HELD / Committee emailed director seven times, over eight months, requesting information required by to carry out the investigation into the salesperson employed by agency / notice served correctly / reasonable basis to believe that the information could be obtained by managing director / director failed to provide sought information / no evidence director was unable to provide required documents / day-to-day responsibilities and impact of COVID-19 lockdowns did not excuse non-compliance / finding that director was aware of s 85 notice and appreciated risk of contravening Act / sustained failure to provide information / misconduct charges against director and agency upheld / penalty decision to follow

Appeal / licensee conducted two visits to complainant tenant’s property / complainant alleged that licensee failed to attend one arranged outside-only viewing and later forcibly entered property without consent / Registrar took no further action / Real Estate Agents 2008, s743a and s111 / Professional Rules 2012 / HELD / evidence supported conclusion that second visit had been agreed upon and was not rescheduling of missed appointment / in any event, a licensee’s forgetfulness resulting in a missed appointment could not justify disciplinary response / no evidence that licensee misled complainant as to scope of two arrangements / only independent evidence supported licensee’s assertion of consented entry / appeal dismissed / Registrar’s decision to take no further action confirmed

Appeal / licensees advertised cottage as having electricity connection linked to main house / following settlement, purchasers were required to pay for installation of separate connection / Committee found licensees’ misrepresentation, albeit made innocently, amounted to unsatisfactory conduct / Real Estate Agents 2008, s111 / Professional Rules 2012, r5.4 and r6.4 / Tribunal directed licensees to apply for leave to produce fresh evidence / fresh evidence not considered in absence of such application / in any event, licensees’ submissions supported Committee’s determination that licensees had misrepresented there was a separate electricity connection / appeal dismissed / Committee’s finding of unsatisfactory conduct confirmed

Appeal / licensee provided purchaser with key to property prior to settlement without vendor’s permission / Committee found licensee guilty of unsatisfactory conduct / Committee ordered censure, $1,500 fine and refund of commission to sum of $3,000 / licensee appealed against penalty / Real Estates Agents Act 2008, s3, s4, s892b, s93 and s111 / Professional Rules 2012, r5.1, r9.1 and r9.5 / Tribunal admitted licensee’s fresh evidence of commission statement / evidence relevant, cogent and credible / Committee did not refer to any evidential foundation when fixing sum of compensatory order at $3,000 / interests of natural justice supported admission of evidence / commission refund should identify and relate to particular aspect of work relating to disciplinary findings / unsatisfactory conduct did not pertain to entire range of work provided / Committee’s refund sum excessive / $1,500 refund and $1,500 fine appropriate / Committee’s decision modified / appeal partially upheld

Appeal / complaint licensee and agency mismanaged conflict of interest and agency failed to appropriately supervise licensee / licensee’s family member purchased property / Committee found licensee and agency guilty of unsatisfactory conduct for failure to follow s134 / fined agency $9,000 and published its name / vendor appealed against penalty / Real Estates Agents Act 2008, s3, s4, s72, s73, s93, s111, s134, s136 / Professional Rules 2012, r6.4 / HELD / Tribunal clarified Committee’s liability findings / found Committee erred in failing to consider refund under s134 / complainants in disciplinary proceedings need not commence civil proceedings to recover under s134 / nexus required between subject of upheld complaint and refund / s134 does not require licensee to act under agency agreement nor any loss to vendor / refund punitive, not compensatory / licensee and agency ordered to refund commission shares / Committee’s decision modified / appeal partially upheld   

Liability and penalty / real estate agency pleaded guilty to amended charge of unsatisfactory conduct for non-compliance with Audit Regulations over one year period / failure to appoint auditor, notify Authority of trust account transactions, provide monthly balances, and prepare statement or statutory declaration / Real Estate Agents Act 2008, s72, s110 / Real Estate Agents (Audit) Regulations 2009, reg9, reg15, reg16 / HELD / Tribunal emphasised importance of trust account compliance for public protection / amount of monies transferred in and out of trust account were at times significant / accepted that breaches occurred inadvertently due to miscommunication and change in auditors / agency admitted liability and cooperated with Authority / no prior disciplinary history / company implemented changes to ensure future compliance / low to mid-level penalty appropriate / Tribunal ordered censure, required company officer to undergo training and imposed $5,000 fine

Application to review Registrar’s determination / Registrar cancelled licence as licensee failed to complete required continuing education / Real Estate Agents Act 2008, s54d, s55, s112 / Real Estate Agents (Continuing Professional Development Rules) Notice 2018 / HELD / did not complete CPD by deadline / Registrar correctly followed statutory process / Registrar must cancel licence as required by s54d / Registrar has no discretion to consider health or financial circumstances / no application for deferral or exemption made / licensees are responsible for ensuring they receive correspondence from Registrar / no error of fact or law / application dismissed / Registrar’s decision confirmed

Appeal / licensee advertised property as having “home automation” /  purchasers alleged that licensee had misrepresented that property featured a Control4 automation system / Committee took no further action / Real Estate Agents 2008, s111 / Professional Rules 2012, r6.4 / HELD / licensee provided base package material specifications which did not reference Control4 / purchasers made no queries about whether Control4 included and had obtained legal advice on sale and purchase agreement / purchaser had purchased base package with central hub wiring for smart home system / not proven that the licensee failed to accurately represent what was included in property’s home automation system / vendor’s evidence corroborated licensee’s evidence / appeal dismissed / Committee’s decision to take no further action confirmed