Watch Out When Your Agent Wants To Buy Your Property

Posted on October 15, 2007 by | 5 Comments

Tim O'Dwyer M.A., LL.B by Tim O’Dwyer M.A., LL.B
Solicitor
Consumer Advocate
watchdog@argonautlegal.com.au


 


A seller has achieved, without legal representation, a spectacular win in Queensland’s Commercial & Consumer Tribunal.  A suburban real estate agency and one of its registered  salespersons were held liable for his financial loss of $59,067.50 after an agency saleswoman and her husband bought his matrimonial home before reselling it at a higher price.


 


Less than a day after this home was listed for sale the agency’s manager rang the client, who was undergoing a bitter marriage breakup, to advise how the saleswoman was interested in the property.  Although the client had been told the property would be marketed in the “high four hundred, low five hundred thousands”, a written offer of $400,000.00 was presented.  Because the client was unhappy with this amount, the offer was quickly increased to $410,000.00.  A 60 day contract was soon entered into at this price on a miserly deposit of $1,000.00.  No finance condition.  No special conditions.  And no commission payable to the agency.


 


The next day after settlement the buyers relisted the property for sale with the agency. They sold a week later for $485,000.00 on a 90 day contract with a deposit of $24,050.00 – conditional only on satisfactory building/pest inspection reports.  The second buyer testified to the Tribunal that he had been looking for a house like this for some time, and would have paid that price had he been shown the property three months earlier.


 



As this was a “self-interested transaction” the agency and the saleswoman should, according to the Tribunal, have suggested the seller seek independent valuation and legal advice.


 


In failing to market the property to independent purchasers, in failing to advise their client the offers were below market and in failing to disclose that the market was rising the agency and the saleswoman did not act fairly towards their client.  Moreover, the saleswoman breached Section 145 of the Property Agents and Motor Dealers Act by neglecting to obtain the client’s written consent on a prescribed form before contracting to buy his property.  At the same time the agency breached the Act by not properly supervising the salesperson and not ensuring that she complied with the law.  The agency also breached its fiduciary duty to its client as well as the Act’s Code of Conduct by not exercising reasonable care and diligence, not acting in the client’s best interests and not securing him the best possible sale price.


More about  “Watch Out When Your Agent Wants To Buy Your Property”…



Lawyers Conveyancing is proud to sponsor the REIC

Categorised in:

5 Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

Please prove you\'re a human by completing this equation: * Time limit is exhausted. Please reload CAPTCHA.