Supreme Court upholds ruling on Hamilton realtor collusion

Monarch director Brian King. Photo / File

The Supreme Court has upheld a ruling that a group of Hamilton realtors colluded to pass on a hike in Trade Me's property listing fees.

The Lodge and Monarch agencies and their respective directors Jeremy O'Rourke and Brian King were the hold-outs in a 2015 case brought by the antitrust Commerce Commission. Thirteen national and regional real estate agencies were accused of fixing prices in 2013 and 2014, most of whom acknowledged the wrongdoing.

The two firms successfully defended the claim in a 2017 High Court hearing, but lost when the commission took the case to the Court of Appeal in 2018. The Supreme Court today unanimously dismissed their appeal.

Chief Justice Helen Winkelmann and justices Susan Glazebrook, Mark O'Regan, Ellen France and Joe Williams upheld the appeal court's ruling, saying the agencies took a concerted approach to Trade Me listings that prevented competition from developing.

The judges accepted there was some rationale for the agreement to promote the rival realestate.co.nz platform, but said that wasn't the sole purpose.

"It went hand in hand with the purpose to establish a concerted approach to Trade Me listings that protected the Hamilton agencies from the risk that one would steal a march on the others by offering to absorb the Trade Me listing fee as a default setting, forcing the others to respond or risk the loss of listings," the judgment said.

"We consider the latter was a substantial purpose of the arrangement controlling the price Hamilton agencies charged for their services by restricting the field of competition between them on that element of the price."

The agencies and their directors were ordered to pay costs of $35,000 plus disbursements.

The Commerce Commission welcomed the ruling, saying it confirmed a long-standing approach taken in working out whether competitors had colluded.

"This case will inform our future work and we urge businesses and their advisers to understand the court's findings, and the scope of the prohibition against pricing collusion between competitors," chair Anna Rawlings said in a statement.

A penalty hearing for the realtors is still to be scheduled.