Christchurch Lotto winner's house purchase turns sour

The Lotto winner was not familiar with any part of the process of buying a house or the prices paid for houses in Christchurch, the tribunal said. Photo / Geoff Sloan

Lotto winner knew agent, regarded him as a friend

A Lotto winner, who initially lost a case when he complained about buying a Christchurch house which he sold at a loss, has had that decision overturned and both the agency and its salesperson were found guilty of unsatisfactory conduct.

The Real Estate Agents Disciplinary Tribunal, headed by Justice Pamela Andrews, allowed an appeal by Lotto winner Russell Martin after he complained about a decision by a Complaints Assessment Committee of the Real Estate Agents Authority which initially rejected his case.

On appeal, the tribunal found Harcourts agent Nathan Tamihana and Gold Real Estate Group, trading as Harcourts Gold Real Estate, had engaged in unsatisfactory conduct.

In March 2014, Martin won "a substantial Lotto prize," the tribunal said, which "put him in the position of being able to buy a house - something that, as a sickness beneficiary, he had never before contemplated being able to do. He was not familiar with any part of the process of buying a house or the prices paid for houses in Christchurch."

Russell knew Tamihana and regarded him as a friend. He was shown a number of properties and was eventually interested in an Idris Rd place going to auction. He put in a pre-auction offer of $890,000 but then wanted to cancel that.

He was not allowed to, bought the property then resold it only five months later for just $765,000.00.

Russell then complained to the Real Estate Agents Authority about misled about the price of the place, the level of interest in the property, pressure which made him make an offer at too high a price, not being provided with a copy of the pre-auction offer form or booklet and that the people named on the pre-auction offer form were not involved.

The tribunal noted that Russell thought Tamihana - who he had known socially for three to four years and had lunches with - was working in his interests. Tamihana "never said he was working for the vendor rather than him," the tribunal found.

"The committee was wrong to decide not to inquire further into the appellant's complaint. His appeal is allowed," the tribunal said.

"Having undertaken that inquiry, we find that the licensee and the agency have engaged in unsatisfactory conduct," it said.

John Waymouth, a specialist real estate barrister, said the case was of significant importance to all real estate salespersons and companies.

"The background to this matter is quite disturbing, but the lesson for the real estate industry is the need to ensure that all purchasers are fully aware that although they are engaging with a real estate salesperson or real estate company, the person or company is acting in the vendor's principal and primary interests. The salesperson or company also have balancing duties of fairness and care to the buyers," Waymouth said.

Read the full decision