Don’t Trust Agents’ Pet Solicitors Or Conveyancers

Posted on May 4, 2007 by | 0 Comments

by Tim O’Dwyer Solicitor*

A solicitor, recently discharged from bankruptcy, has given an enforceable undertaking to Queensland’s Office of Fair Trading after consistently failing to comply properly with a consumer protection law. He is not the first.

The undertaking records that Fair Trading’s Chief Executive “reasonably believes” Gold Coast solicitor Gregory Pointon contravened Section 365B of the Property Agents and Motor Dealers Act by not declaring to clients his relationships with real estate agents.

The Beattie Government brought in this solicitors’ “declaration of (non)independence” in a clumsy attempt to curb the lucrative role played by professional parasites, particularly in helping stitch up novice investors in over-priced properties – particularly on the Gold Coast.

From 2001, when Section 365B became law, until June 2005 Pointon acted for at least five buyers per week. Over this period he failed to disclose to those clients the “referral of business” relationships he had with real estate agents. Sellers’ agents, who disclosed their connections as required by law, regularly referred conveyancing clients to him.

The Queensland Law Society president declined to comment on Pointon’s conduct but his spokesman said, “Every legal practitioner is expected to strictly observe the profession’s Code of Ethics and all requirements of the law, and those who breach either will find no sympathy from the Queensland Law Society.” Never mind that it’s own earlier lame investigation of Pointon, on the very same complaint as made to Fair Trading, fizzled out to nothing.

Queensland’s Fair Trading Minister says Section 365B is meant to protect real estate and legal consumers: “Clients have a right to know whether the lawyer they have employed has a business or other relationship with other parties involved in a sale and, if there is an established relationship, the clients may choose to take their business elsewhere.”

Unfortunately few solicitors’ clients, cosily referred to agents’ pet solicitors, ever appreciate the significance of any disclosures – whether the properties being bought are over-priced or not. Regretably the Beattie Government has had neither the wit nor the will to prohibit solicitors acting when they are not independent, or to outlaw agents referring buyers even to the local Chinese take-away.

There are no similar laws requiring disclosure by referring agents and referred solicitors (or conveyancers) of their relationships anywhere else in Australia, so trusting buyers interstate invariably use legal and conveyancing services recommended by sellers’ agents. No government is prepared to bite the bite the bullet to properly protect real estate and conveyancing consumers from self-interested agents and their conveyancing cobbers.

My disclosure? Some agents occasionally refer clients to me when they want folk rescued from other agents’ contracts!

* (Tim O’Dwyer is a Queensland solicitor and consumer advocate – watchdog@argonautlegal.com.au)

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