Ministry of Justice

Compensation referral / unsatisfactory conduct / Committee found licensee failed to disclose house had a risk of both methamphetamine contamination and a weathertightness issue / purchaser subsequently discovered it suffered from both, leading to remediation costs / Real Estate Agents Act 2008, s50, s93, s110 / Professional Rules 2012, r10.7 / compensation to be considered on legally principled basis / losses must flow from unsatisfactory conduct and substantive matters found by Committee / purchaser entitled to remediate methamphetamine contamination to below the acceptable levels stipulated in NZ Standard / claimed weathertightness losses not casually established, involved high level of contributory negligence / claimed legal costs not sufficiently connected / $24,707.75 in losses attributable to licensee’s unsatisfactory conduct reduced to $14,825, accounting for licensee’s innocent representation, purchaser’s contributory negligence, and nature of risk rather than known defect

Compensation referral / unsatisfactory conduct / Committee found licensee failed to disclose house had plaster cladding, and her overall disclosure concerning leaks in property had unjustifiably downplayed and misrepresented their potential seriousness / Committee further found licensee’s supervisor failed to adequately supervise and manage licensee / Real Estate Agents Act 2008, s50, s93, s110 / Professional Rules 2012, r5.1, r6.1, r6.4, r10.7 / purchasers’ loss of rent (over 57 weeks), invasive property inspection fee, and costs for temporary repairs were casually and closely connected to licensees’ conduct / losses exceeded Tribunal’s jurisdiction of up to $100,000 / compensation reduced by 25 per cent for licensee’s innocent misrepresentation, by 15 per cent for purchasers’ contributory negligence, and by 25 per cent to reflect non-disclosure of risk rather than known defect /  licensees ordered to pay $35,000 / licensees’ liability joint and several, split equally between themselves

Application to review Registrar’s determination not to pursue complaint as it only disclosed inconsequential matter / purchaser of vacant residential section later discovered fence encroaching onto property / alleged licensees should have warned him to obtain a boundary survey / Real Estate Agents Act 2008, s74, s112 / Professional Conduct and Client Care Rules 2012, r5.1, r6.4, r10.7 / HELD / licensees do not have duty to identify and point out property boundaries, except where there is apparent cause for concern / licensee must be proactive when asked or the licensee might reasonably be expected to do so / no ‘red flag’ in these circumstances / presence of fence and storm tank did not suggest encroachment / Registrar correct in determining there was insufficient evidence the licensees knew or should have known of potential boundary issue / application dismissed / Registrar’s decision confirmed

Appeal / property sold ‘as is where is’, buyers advised to seek advice from builder on piles / licensee failed to disclose report as to extent of problem with piles and condition of subsoil / Committee found licensee engaged in mid-to-high level unsatisfactory conduct for withholding information that should have in fairness been provided and for failing to exercise skill, care, competence and diligence / ordered censure, $6,500 fine and compensation referral / licensee appealed against assessment of conduct and fine / Real Estate Agents 2008, s89, s111 / Professional Conduct and Client Care Rules 2012, r5.1, r6.4 / HELD / licensee failed to disclose geotechnical report containing very material and specific information and recommendation / Committee’s assessment of gravity of conduct overlooked ‘as is where is’ nature of sale, with specific recommendation to have piles examined by builder / unsatisfactory conduct properly assessed as moderate, not mid-to-high / fine reduced to $5,000

Costs / Tribunal awarded compensation to complainant in the sum of $46,875 / complainant subsequently applied seeking costs of $17,293.70, being legal costs of attendances by two barristers / Real Estate Agents Act 2008, s 110A / HELD / reasons advanced for award of costs are no more than those justifying costs on the principle they follow the event / licensee participated in good faith and facilitated Tribunal’s process / licensee entitled to defend himself / reasonable basis for defence to claim of compensation / claim for costs dismissed

Application to review Registrar’s determination / Registrar determined not to pursue complaint as it only disclosed inconsequential matter / parties filed joint memorandum inviting Tribunal to reverse Registrar’s decision by consent, so Registrar may refer matter to Committee / Real Estate Agents Act 2008, s743a / HELD / application granted, Registrar’s decision reversed.

Application to review Registrar’s determination / Registrar cancelled licence as licensee failed to pay prescribed fee / Real Estate Agents Act 2008, s54h, s55, s112 / HELD / Registrar correctly followed statutory process / Registrar must cancel licence as required by s54h / no error of fact or law / application dismissed / Registrar’s decision confirmed

Appeal / agency released deposit of $37,500 early without authority signed by all parties / transaction close to to holiday period / Committee found agency liable under s 123 and imposed $2,000 penalty / agency appealed against liability and penalty on basis of low gravity offending / Real Estate Agents Act 2008, s89, s111, s123 / Professional Conduct and Client Care Rules 2012, r5.1 / Real Estate Agents (Audit) Regulations 2009 / HELD / compliance with statutory and regulatory requirements not a ‘nice to have’ and breaches are treated seriously / public confidence underpins statutory provisions / agency’s wrongdoing at lower end of spectrum however not so low as to be below disciplinary threshold / Committee’s liability and penalty findings affirmed / appeal dismissed

Appeal / complainant vendor alleged that licensees misled him regarding ability to modify settlement date and did not recommend he seek legal advice / Committee determined it was clear to vendor that the date could only be adjusted by purchasers’ mutual agreement and that he was advised to seek legal advice / Committee took no further action / Real Estate Agents Act 2008, s111 / Professional Conduct and Client Care Rules 2012, r5.1, r6.4, r9.7 / HELD / appellant vendor must have understood that settlement was due to occur on specified date unless both parties agreed otherwise, with prior confirmation / no correspondence supported allegation that licensees represented settlement as flexible / licensees expressly reminded vendor of relevant clause and of his ability to seek legal advice / Committee’s decision confirmed / appeal dismissed

Application to review Registrar’s determination / Registrar cancelled licence as licensee failed to pay annual fee for keeping licence suspended / Real Estate Agents Act 2008, s54h, s55, s112 / HELD / licensee was required to pay suspension fee by certain date, received required communications from Registrar, and did not make payment by deadline / applicant’s misunderstanding as to second annual fee payment caused by erroneous assumption / Registrar correctly followed statutory process / Registrar must cancel licence as required by s54h / no error of fact or law / application dismissed, Registrar’s decision confirmed

Appeal / purchasers entered into unconditional S&P agreement which could not settle due to lack of finance / incurred losses, including forfeited deposit / Committee found licensee engaged in unsatisfactory conduct in failing to exercise skill and care, and for failing to deal fairly with the parties / ordered $4,500 penalty and $6,678.44 in costs / Real Estate Agents 2008, s89, s111 / Professional Conduct and Client Care Rules 2012, r5.1, r6.2 / HELD / licensee aware of high risk aspects of transaction / took insufficient steps to mitigate risks / failed to raise or document vendor finance agreements / unsatisfactory conduct finding upheld / Committee erred in uplifting fine for lack of genuine remorse / fine reduced to $3,500 / Committee erred in costs orders / exercise of costs jurisdiction must adhere to natural justice / Committee provided brief reasons and failed to allow licensee opportunity to be heard / costs order reversed

Application to review Registrar’s determination not to pursue complaint as it only disclosed inconsequential matters / complaint licensees failed to adequately communicate with complainant as to residential sale process relating to relationship property proceedings / alleged that licensees inappropriately managed and proceeded with sale, contrary to Family Court orders / Real Estate Agents Act 2008, s74, a112 / Professional Rules 2012 / HELD / licensees endeavoured to keep complainant informed throughout sale process / nature of dispute over compliance with Family Court orders not disciplinary matter involving licensees / allegation of unauthorised disclosure of information unsupported by evidence / licensees not responsible for safekeeping of complainant’s chattels and providing him access to property, especially given protection order in force restricting access / no evidence of misleading advertising / Committee’s decision upheld / no error of fact or law / application dismissed / Registrar’s decision confirmed

Application to review Registrar’s determination / Registrar cancelled licence as licensee failed to pay prescribed fee / Real Estate Agents Act 2008, s54h, s55, s112 / HELD / Registrar correctly followed statutory process / Registrar must cancel licence as required by s54h / no error of fact or law / application dismissed / Registrar’s decision confirmed.