When “Consumer Affairs” Engages In Misleading & Deceptive Conduct

Posted on May 4, 2007 by | 0 Comments

Consumer Affairs Victoria (CAV) is regarded by consumers as something of a guardian angel. But what if those white fluffy CAV wings turn out to be attached, not to a soaring supernatural protector, but to an earth-bound and very lame duck?

Just take a look at the CAV booklet titled, “Real Estate – A Guide For Buyers and Sellers“. This publication has been promoted through expensive advertising campaigns in the print media, on the CAV website, and in the offices of local Members of Parliament, as well as those of banks, estate agencies and lawyers.

One could be forgiven for assuming that the text for the booklet was provided by the Real Estate Institute of Victoria (REIV), as it is poorly researched, patronisingly simplistic, and misleading in its interpretation of the law. (See previous postings regarding the REIV’s contributions to the development of consumer awareness.)

For example, the following statement appears on page 16:

“Anyone who is in the business of buying, selling, leasing or otherwise dealing with real estate or a business on behalf of any other person, must hold an estate agent’s licence or be employed by a licensed estate agent as an agent’s representative…Only deal with a licensed estate agent or an agent’s representative.”

This statement is both misleading and deceptive. The truth is that any lawyer can act on behalf of a client who is buying or selling real estate. In fact, all legal practitioners are “estate agents” under the Estate Agents Act 1980.

Similarly, a person who is buying real estate may decide to engage a lawyer to represent them during negotiations, and to prepare the terms and conditions of their offer. Does CAV recommend that a purchaser should consider engaging a legal professional as their advocate in such circumstances? No. CAV recommends that a consumer should engage someone who has no training in law, who is not qualified to draft terms and conditions, and who is prohibited from giving legal advice – an estate agent! Here’s what CAV says on page 17:

If you use a buyer’s advocate, make sure that he or she is a licensed real estate agent.

Why should a consumer make sure that the person they engage as an advocate is an estate agent rather than their lawyer? There is no explanation.

We took CAV to task over this issue some time ago, but they replied that the booklet reflects the law in Victoria. Well, what can you say when you’ve printed thousands of booklets and your reputation as a guardian angel is riding on them? Quack!

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