A real estate agent has been fined $1500 for treating a potential buyer unfairly, the Real Estate Authority found. Photo / 123rf
Three property buyers have lodged a successful complaint against a Kapiti Coast real estate agent who they thought was trying to sell them a farm but instead bought it himself.
The complainants told a Complaints Assessment Committee hearing that acting together they sought to buy the "residential" farm in September last year where they dealt with selling agent Grant Robertson from GBR Realty, which trades under the name First National Real Estate Otaki.
However, Robertson at no point told them he had also put in an offer to buy the property, a recent CAC decision found.
He also failed to inform them about a final deadline date by which point they must have submitted their offer to buy, the committee decision said.
The complainants subsequently missed the deadline to put their offer in, and later discovered Robertson had bought the property himself.
CAC chairman Paul Biddington and his fellow committee members concluded Robertson had been guilty of unsatisfactory conduct and slapped him with a $1500 fine.
Biddington said Robertson did not legally have to disclose to the buyers he was interested in buying the residential property, but should have stepped away from negotiations involving them.
He acted "in his own best interests" by fielding inquiries from them without telling them he also wanted to buy it, Biddington said.
"When a licensee is in a multi-offer situation and he is one of the intended purchasers, disclosure to the other parties of his interest must be made, so the process is transparent."
But Robertson told the Herald he did not break any law or agent's code of conduct.
He said he sold 75-80 properties a year and about 70 per cent involved offers from multiple buyers, meaning he was well versed in what was required.
"I am certainly required to declare my interest to the vendor and that was done in full compliance to the law, with our code of conduct and with fairness to the vendor.
"I am not legally obliged to notify other purchasers that I am interested in buying - not by our code of conduct and not by the law of the land."
He said the complainants had their chance to put in an offer on the home but didn't take it and had now turned bitter.
Buyers who miss out can "take it really personally" and "that was certainly the case here", he said.
The complainants, for their part, earlier registered their interest in the property around September last year.
After viewing the home, they sent a "Letter of Intent" to buy the farm to Robertson on September 11.
They offered to make a $100,000 deposit as an "act of good faith" and to show they were "serious purchasers".
They advised they expected the bank to approve their finances by September 18-19 and that they wanted to make an unconditional offer by September 20.
Robertson said this information was presented to the people selling the farm by one of his real estate colleagues.
However, those selling the farm dismissed it as having "no substance" because it had "no price, no settlement date, and was not on a Sale and Purchase Agreement form", he told the CAC hearing.
The farm seller later said they never saw the letter but did remember mention of the $100,000 deposit, CAC chairman Biddington said.
He concluded on the balance of probabilities that Robertson's team never showed the letter of intent to the farm sellers but did explain its contents to them.
Biddington said while ideally the letter should be shown to the farm sellers, there was "no absolute obligation" on Robertson to do so and dismissed this complaint.
However, Biddington did take issue with the fact Robertson continued to engage in negotiations with the complainants about the home up until he bought it on September 17.
At one point, Robertson asked the complainants what price they were considering paying for the home, but was told the complainants hadn't discussed a price yet with their bank.
Biddington said he was "of the opinion that if the licensee had been told by the complainants what price they were thinking of offering, he would have had inside information".
"This conduct is unacceptable, as the licensee knew he had a conflict of interest," he said.
He also questioned why a deadline was set for September 17 by which point all offers to buy the home had to be submitted.
Biddington said Robertson knew the complainants were still negotiating finance and were interested in making an offer on about September 20.
Yet he failed to tell them a deadline had been instead set for September 17.
Biddington said he couldn't be certain that Robertson's failure to inform the complainants about the deadline to submit offers came at a cost to the person selling the home.
That was because the home seller seemed happy with the price paid, he said.
However, it was unfair to the home buyers.
Biddington said Robertson should have stepped aside once he made an offer to buy the home and let his colleague manage negotiations between home buyers and home sellers.
"The licensee now accepts he should have stepped back from all negotiations once his offer had been presented to the vendors and the committee agrees," he said.
"Further, when the licensee confirmed that the property had been sold and he was the purchaser, the complainants became upset and disappointed they had missed out on purchasing the property.
"They believe, the conduct of the licensee was unethical and in his own interests, and the committee agrees."
Robertson told the Herald he rejected the CAC's verdict, saying he always did his best by seller and buyer.
"In pursuit of my fiduciary duty to the vendor, I did continue to encourage and try and get the three complainants to put an offer in - in other words, I was not happy until they had made their offer," he said.
"They didn't make an offer, they never made an offer, they never made any moves whatsoever and they missed out - straightforward end of story."