Ministry of Justice

Appeal / sale of residential property following breakdown of marriage / appellant alleged that respondent licensees knew about personal circumstances and colluded to effect sale and did not act in best interests by failing to discuss open market advertisement, that no CMA or appraisal was provided / Committee joined director of agency to proceedings per allegation of improper supervision / Real Estate Agents 2008, s89, s111 / Professional Conduct and Client Care Rules 2012, r6.1, r6.2, r.6.4, r9.1, r9.2, r9.16, r10.1, r10.2 / HELD / appellant’s suggestion he was never provided a copy of CMA unsupported by evidence / CMA arrived at using due care, skill, expertise and judgement with reference to comparable sales information / subsequent sale of property at significantly higher price did not indicate deficiency in CMA / no evidence of undue or unfair pressure / joined respondent was not designated supervisor / no error of fact or law / Committee’s decision affirmed / appeal dismissed

Compensation referral / unsatisfactory conduct / Committee found licensee misrepresented extent of utility connections and failed to disclose geotechnical report to complainant purchasers / Real Estate Agents Act 2008, s72a, s93, s110 / Professional Rules 2012, r5.1, r6.4 / Fair Trading Act 1986, s43 / HELD / principles developed for award of loss or damage under FTA relevant to discretion to award compensation / broad and pragmatic approach taken to determine causal connection between losses claimed and contravening conduct / not open for Tribunal to review finding of unsatisfactory conduct in lieu of appeal to challenge determination / agency’s commission, vendor’s legal costs, complainants’ legal costs and LIM report fees attributable losses to unsatisfactory conduct / claim for loss of growth in property market unsubstantiated / compensation sum to achieve justice to parties / licensee acted in good faith though carelessly / licensees ordered to pay $34,437.38

Appeal / licensee sent pre-signed agency agreement for a sale to mentally unwell tenant of property, expecting it to be passed to co-owners / Real Estate Agents Act 2008, s4, s50, s111 / Professional Conduct and Client Care Rules 2012, r5.1, r8.3, r9.9, r10.2, r10.6 / HELD / Committee erred in finding no “real estate work” / licensee sent agency agreement and undertook multiple steps for the purpose of bringing about a sale, seeking involvement of co-owners, through tenant / “other person” taken to be either tenant or co-owners, thus “real estate work” / licensee sent pre-signed agency agreement and appraisal to tenant without undertaking pre-contractual required work  / however, dealings ended early in pre-listing process and occurred in context of persistence by unwell tenant / threshold for disciplinary response not met / similarly, disciplinary response not justified for manager’s lack of supervision / use of pre-signed agreements and appraisals cautioned against / appeal dismissed

Application to strike out compensation referral proceedings / Committee found licensee engaged in unsatisfactory conduct in failing to bring complainant’s attention to altered clause, as well as in failing to disclose in writing that he may financially benefit from transaction and to obtain signed acknowledgement / licensee applied to strike out proceedings as parallel civil proceedings had been decided by District Court / Real Estate Agents Act 2008, s109A, s110, s136 / Professional Rules 2012, r5.1, r6.2, r6.3 / HELD / Tribunal noted distinction between legal rights in parallel civil District Court proceedings and present disciplinary proceedings / claim before Tribunal whether complainant should be awarded for any loss suffered by reason of the licensee’s unsatisfactory conduct, rather than breach of contract / nature and extent of claimed losses unclear / relevance of res judicata and issue estoppel to considered in due course / strike-out application dismissed

Application to review Registrar’s determination not to pursue complaint as it only disclosed inconsequential matters / complaint tender process was unfair and not transparent to complainant & that licensees misled vendor to advantage offer from listing agent’s client / Real Estate Agents Act 2008, s743a, s107A, s112 / HELD / no obligation to disclose (without vendor’s instructions) vendor would not accept, and had previously rejected, vendor finance condition / was vendor’s decision to bring forward tender deadline / no evidence licensees brought forward deadline themselves or acted contrary to vendor’s interests / no evidence vendors not aware of complainant’s interest in property / vendors not obliged to give complainant more time to improve offer / licensees not required to disclose information about previous offers (unless instructed by vendors) / licensees kept complainant informed to extent necessary / application dismissed / Registrar’s decision confirmed 

Costs / first compensation referral decision / Tribunal awarded compensation to complainant in the sum of $35,101.65 / parties invited to file submissions on costs / Real Estate Agents Act 2008, s931ha, s1104, s1105, s1106, s110A / HELD / Tribunal’s approach to costs awards differs from civil court proceedings / under s110A, Tribunal to consider whether and to extent any party has participated in good faith, facilitated or obstructed information gathering, and facilitated the resolution of issues / approach to compensation referral prioritises access to justice and would not wish to deter complainants from seeking compensation due to potential costs exposure / no adverse factors indicating costs should be awarded in favour of either party / licensees generally cooperative throughout / costs to lie where they fall

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

Compensation referral / Committee found licensee one failed to ensure property was sold as a going concern and include vendor’s GST registration in sale and purchase agreement (ASP) and licensee two failed to supervise / Real Estate Agents Act 2008, s110, s1105 / Professional Rules 2012, r5.1, r5.2, r8.3, r8.4, r9.8, r9.9 / KD v Donaldson [2023] NZREADT 12 / HELD / first compensation referral decision / Tribunal may have regard to principles from its compensation jurisdiction under s1102g / must apply, and must not overturn, Committee’s determination of any substantive matter in the case / no jurisdiction to award interest under Interest on Money Claims Act 2016 / satisfied loss caused by licensee’s unsatisfactory conduct / commission repayment by licensee should be taken into account as it offset vendor’s losses / 15 per cent reduction for vendor’s failure to mitigate loss by signing ASP  and not seeking legal advice / licensees ordered to pay $35,1011.65

Interlocutory application for full disclosure of confidential information / unsuccessful tenderer alleged licensees’ tender process was not transparent, did not reasonably explain shift in tender date, had unreasonable time constraints, and lacked proper communication with tenderer’s agent / Registrar relied on information not fully disclosed to complainant in determining not to pursue complaint, concluding it disclosed inconsequential matters / Real Estate Agents Act 2008, s743a, s105, s109, s112 / HELD / Tribunal considered unredacted documents to determine appropriateness of disclosure / failure to disclosure “secret” information prima facie breach of natural justice / however, complainant was provided sufficient description of documents to answer licensees’ defence / redactions appropriate in light of privacy interests / Registrar should have advised complainant its possession of confidential information but failure to do so not error of law / redacted information of insufficient p…

Application to review Registrar’s determination not to pursue complaint as it only disclosed inconsequential matters / Real Estate Agents Act 2008, s74, s107A, s112 / Professional Conduct and Client Care Rules 2012, r5.1 and r6.4 / HELD / purchaser alleged licensee enticed consideration of property with lower price than in fact sought / Registrar overlooked licensee’s admission as to communicated price expectation / nonetheless, Registrar’s conclusion that licensee did not give incorrect or misleading advice justified / purchaser not misled as to price at critical time of making offer / purchaser also disputed licensee’s statements regarding leak / licensee assured purchaser that leak was historic / Registrar failed to consider evidence of licensee’s knowledge of ongoing leak and failure to disclose until after settlement / purchaser further alleged licensee unduly pressured her into purchase / frequency of phone communications reasonable / Registrar correct to find no evidence of undu…

Liability / misconduct and incompetent or seriously negligent real estate work charges against licensee, managing director and agency arising from imbalances in VPA account balances / Real Estate Agents Act 2008, s3, s50, s72, s73b, s73c, s s85, s86, s110 / Professional Rules 2012, r5.1, r6.1, r6.3, r8.3, r8.4, r9.13 and r10.6c / HELD / licensee’s practice of ticking “no refund” without confirmation reckless / licensee liable for reckless contravention per s73b / director and agency did not have appropriate checks and balances to control VPA funds / numerous failings seen as systemic failure to reconcile VPA / properly characterised as negligence / director and agency liable per s73b / license failed to adequately particularise marketing and advertising costs / unsatisfactory conduct per s72a / director and agency’s failure to supervise licensee’s handling of VPA inadequate / director and agency liable for misconduct per s73b / penalty decision to follow

Penalty / licensee misled purchaser as to status of builder and existence of transferable guarantee / Real Estate Agents Act 2008, s3, s50, s93, s108, s1104, s1115 / Professional Rules 2012, r6.4 / licensee’s misrepresentation was careless but unintentional / breach of Rules occurred more than 10 years ago / licensee was novice agent at time of misrepresentation and not subject to disciplinary complaints in intervening years / no need for personal deterrence against repetition / disciplinary orders not warranted / no clear claim for compensation from purchaser / reference to significant legal costs allegedly incurred by purchaser not supported by breakdown of costs or documentary evidence / causative link between misrepresentation and loss unproven / no penalty orders imposed / passage of time since unsatisfactory conduct insufficient to displace presumption of publication of licensee’s identity in interests of transparency

Appeal / licensee failed to disclose removal of gate and shower glass wall in sale agreement and during final inspection / Committee found licensee guilty of unsatisfactory conduct and ordered replacement of gate and shower / Real Estate Agents Act 2008, s931f, s111 / Professional Rules 2012, r5.1, r6.2, r6.4 / HELD / licensee incorrectly applied “legalistic lens” to vendors’ query concerning removal of gate / should in fairness have disclosed to purchaser, irrespective of whether chattel or fixture, and despite intention to redevelop property / incorrectly advised vendors shower wall could be removed / no evidence of purchaser’s consent to shower wall removal / breaches of r5.1, r6.2 and r9.1 / properly assessed as low to middle gravity of offending / Committee lacked jurisdiction to order relief as consequences of licensee’s errors were no longer operative following demolition / Committee’s modified / liability decision and training order upheld / relief orders vacated