Agent found guilty over misleading commission costs

An Auckland real estate agent has been censured under the Real Estate Agents Act after he mislead a client over his commission fee.

Wednesday, April 28th 2010, 12:00AM

by The Landlord

A Complaints Assessment Committee (CAC), appointed by the Real Estate Agents Authority (REAA) found Lawrence Lalit Naidu of Sega Realty in Manukau guilty of misconduct after there was a discrepancy between the commission fee he told a vendor would be payable on sale and what was ultimately charged by the company in October 2009.

The complaint was laid in December after the vendor was charged $5,287 more than she was led to believe from the oral agreement when she first signed up her house listing.

REAA chair Kristy McDonald said the CAC found Maidu's failure to adequately and accurately explain the commission that would be charged to the complainant and her husband fell short of the standard expected from a "reasonably competent licensee".

However, the CAC was not able to impose any penalties against Naidu because the conduct occurred before the Real Estate Agents Act 2008 came into force on November 17 ,2009. Under the 1976 act, not penalties could be imposed against a salesperson for the equivalent unsatisfactory conduct.

The case is the second misconduct complaint to be made public by the REAA, the first of which related to an agent sending a condolence card to a recent widow, along with business card and details of the property. She too was censured under the act.

Out of the 320 written complaints lodged with the REAA so far, the CACs have dismissed 10 cases at the first reading, after establishing there were no grounds for the complaint to be upheld or were merely vexatious.

Eight have also been dismissed after being referred back to the CACs for a second time after investigation by the REAA. It has published four of eight complaint cases.

An REAA spokesman says the four dismissed cases that have been published are for public education and as the act is focused on consumer protection and transparency, it is also making sure it is transparent with decisions.

"We want people to understand what is deemed as appropriate or not appropriate."

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