Take Care When Crashing Contracts

by Tim O’Dwyer M.A., LL.B
Queensland Solicitor & Consumer Advocate
watchdog@argonautlegal.com.au

Three recent Court decisions highlight the need for conveyancing solicitors to take great care if a client wants to cancel a contract on the ground of the other party’s “repudiation” or “anticipatory breach”. Anyone wanting to back out of a contract on this basis must ensure firstly, that the other party’s conduct actually amounts to repudiation or anticipatory breach and, secondly, that you have met your own contractual obligations.

‘Repudiation’, by the way, occurs when someone is not ready or willing to settle a contract, while an ‘anticipatory breach’ is a form of repudiation where someone signals unreadiness or unwillingness some time before settlement.

Because sellers as well as buyers occasionally suffer “buyers’ remorse”, solicitors must always be prepared to give prompt and sound advice to clients who might be keen to crash a contract if a “repudiatory opportunity” – to coin a phrase – should present itself.

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Rebate Was Really A Penalty!

What if the sales rep tells you that you're getting the property for $330,000 but has you sign a contract for $350,000?


We offer a comprehensive pre-purchase contract and disclosure statement checking service to our clients, and we often find nasty contract conditions appearing like wolves in sheep's clothing. The following situation serves as an example of the way an apparent "sweetner" can be the exact opposite.

Our client came to us for pre-purchase advice, explaining that the sale price of the property was $330,000. We pointed out that the contract, prepared by a company we'll call "What-A-Con", stated that the sale price was in fact $350,000.

"Oh that's OK, the estate agent said that "What-A-Con" have to make the contract out for $350,000 but they give a rebate of $20,000."

Sure enough, there was a special condition in the contract regarding a "rebate", but in our view the rebate was no more than a penalty of $20,000 paid in advance!

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Real Estate Documents – Don’t Be A Goose!

In some European countries they fatten geese by force-feeding them. They use a standard feed formula, and use a standard procedure to ensure that the each goose receives the same measured dose of food.

The goose has no choice, and the whole process is completed by someone who has no interest in what the goose really wants.

This is the same process adopted by many estate agents when “negotiating” with purchasers.

In recent times we have received complaints about estate agents who have illegally attempted to force-feed purchasers.

In each case the purchaser's formal offer was made in the form of a contract, and presented to the estate agent for delivery to the vendor or the vendor's lawyer.

Instead of submitting the offer, as required by law, the estate agent has improperly demanded that the purchaser’s offer should be made on the estate agent’s own “standard” REIV Contract Note, that “standard” REIV conditions should be used, and that there should be no deviation from the estate agent's “standard” sale procedures.

BEWARE! When you hear an estate agent use the word “standard” in relation to sale documents, it usually means that you will be required to open wide and say “Ahh”!

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Estate Agents Who Straighten Pictures!

by Peter Mericka B.A., LL.B Real Estate Lawyer and
Qualified Practising Conveyancer
Victoria
Lawyers Real Estate

At last, there is a real estate agency whose staff know how to straighten pictures.

Not to be outdone by the warm and cuddly estate agents at Stockdale & Leggo, Methven “Professionals” Real Estate appears to be marketing itself as the agency with the ability to straighten poorly hung pictures.

The Methven Professionals flyer tells consumers,

“Service is more than just putting a ‘for sale’ sign up on your property.”

But they don’t offer any indication as to what they do apart from erecting a sign. Seems the consumer is expected to take hints from the photos on the flyer.

Photo 1 appears to show a female estate agent drawing attention to her co-agent while he straightens a picture, to the clear delight of the vendors.

Photo 2 appears to be an action shot of the male agent in the process of straightening the picture.

In photo 3 it looks as though the vendors are delighted with the Methven Professionals agent's picture placing skills. From the smiles on their faces, we suspect that these vendors may even be prepared to pay $675 per hour to have such skills at their disposal.

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Agents-If They Don't List, They Don't Last

Why Selling Your Home Can Be Hazardous To Your Wealth


The following article is written by Jim Hart from an American perspective. However, much of what the author discusses is universal in its application to real estate agents and the industry in which they operate.

An EzineArticle by Jim Hart.

If you are planning on selling your home through a real estate company it may pay dividends to read this article to better understand the role of the agent you select to represent you and your property.


In the real estate business there is an old saying that goes; “If you don’t list, you don’t last”. What this means to you as a home seller is CAVEAT EMPTOR or” buyer beware”—you may not be getting the truth, the whole truth and nothing but the truth from your friendly real estate agent.

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"Crackdown" Still Leaves A Loophole

by Tim O’Dwyer M.A., LL.B
Queensland Solicitor & Consumer Advocate
watchdog@argonautlegal.com.au

Queensland’s Beattie Government has once again claimed to have toughened up its real estate laws. This time it is to “combat” the practice of estate agents’ misrepresenting residential property selling prices to gain listings.

Fair Trading Minister Margaret Keech said the “crackdown” was one of a number of consumer protections resulting from a review of the Property Agents and Motor Dealers Act 2000, and targeted “those rogue real estate agents and auctioneers who indulge in the practice of over-quoting residential property prices".

"Their objective,” she said, “is to secure listings by over-quoting the potential market value of a property to sellers to secure a listing”.

Mrs Keech said misleading sellers and buyers by over-quoting the market price of property “promoted” not only unfair competition against ethical agents but also unrealistic expectations by sellers about the selling price of their properties.

The government’s amending legislation would, according to the Minister, address this conduct by “requiring real estate agents and auctioneers to substantiate any price or reserve price quotation by giving their vendor a document called a Comparative Market Analysis (CMA)."

...but was the Minister aware that this radical new law was just as loop-holed as much of the Beattie government’s previous efforts to protect real estate consumers?

Continue reading "Crackdown" Still Leaves A Loophole"

Real Estate Commission - A Corrupting Influence

An EzineArticle by Peter Mericka.

Real estate commission is the way in which real estate agents are paid for the services they provide. They receive a percentage of the price received for the property. Effectively, the real estate agent requires the seller of a property (the vendor) to sign over to the real estate agent a part of the property being sold.

Another way of looking at it is to say that the real estate agent, through the wording of the listing contract, effectively has his name added to the title deed of the vendor’s property, so that the real estate agent becomes a part-owner of the property. When the property sells, the real estate agent receives a payment that represents his share in the vendor’s property.

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Solicitor Fined $30,000 For Conflict Of Interests

by Peter Mericka B.A., LL.B Real Estate Lawyer and
Qualified Practising Conveyancer
Victoria
Lawyers Real Estate

The Wangaratta Chronicle reports that a Wangaratta solicitor has been fined $30,000 after being found guilty misconduct.(Wangaratta Chronicle 1 May, 2006 p.3)

According the article:

"Jeffrey Alexander Francis has been reprimanded by the Victorian Civil and Administrative Tribunal (VCAT) and given three months to pay...

VCAT fined Mr Francis $30,000 on a charge of misconduct by failing to avoid a conflict of interest situation...

Mr Francis allegedly failed to tell a client, for whom he was acting in relation to the sale of land, that he was a director of the company purchasing the property."

It appears that the solicitor told the estate agent and his client that his wife had an interest in the company which purchased the property, but failed to disclose that he was also a shareholder, director and secretary of the company.

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REIV Fudges Sales Figures

More mass misleading and manipulation of Victorians.


An article from the Jenman website.



The Real Estate Institute of Victoria continues to lie about auction results.

The REIV claims Melbourne recorded a clearance rate on Saturday of more than 70 percent, showing the market was “unfazed by the interest rate rise”.

As anyone who has dealt with the real estate industry knows, figures don’t lie except when liars figure.

Continue reading "REIV Fudges Sales Figures"

See also "REIV Information Outrage!"

The Latest In Real Estate Deception

It appears that estate agents now have a new weapon in their auction deception armory. Street theatre!



Gary Lapersonne, writing as "Secret Agent" in the Domain section of The Sunday Age (Domain p.2 Sunday Age 7 May, 2006) reports on claims that a Melbourne real estate agency is employing professional actors to pretend that they are competing buyers.

According to Lapersonne,

"They don't bid; just look like they are about to by appearing nervous, holding each other etc.

"You're told something like, 'the reserve price is X, pay it or we're going to start dealing with the other couple and you miss out'."

Lapersonne concludes,

"Clever thinking, but their appearance is misleading, even deceptive and possibly illegal."

We can assist Gary Lapersonne by confirming that if, as the result of a trick, a purchaser pays more for a property than he or she would otherwise have paid, a serious criminal offence has occurred.

Continue reading "The Latest In Real Estate Deception"

Ask The Expert Estate Agent? Phooey!

by Peter Mericka B.A., LL.B Real Estate Lawyer and
Qualified Practising Conveyancer
Victoria
Lawyers Real Estate

Looks like the Maroondah Leader has started a new "suck-up-to-the-estate-agents" column called "Ask the experts". (We have previously looked at how local rags court those who direct consumer dollars to them in the form of client-paid advertising in "Journo Sucks Like A High-Speed Hoover").

This time the Maroondah Leader poses the legal question, apparently on behalf of consumers who need to know,

"What happens if I enter into an agency agreement and later change my mind? Can I withdraw my property from sale?"

But then, instead of having a lawyer answer this legal question, they trot out as their expert none other than local estate agent Phillip Webb of Phillip Web Real Estate!

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Misleading Marketer Cops Chickenfeed Fine

by Tim O’Dwyer M.A., LL.B
Queensland Solicitor & Consumer Advocate
watchdog@argonautlegal.com.au

A Port Douglas marketing group which promoted a North Queensland property with pictures from another housing estate has been convicted of misleading conduct and fined in Cairns Magistrates Court.

North Queensland Development Corporation was fined the paltry sum of $1500 for five breaches of the Fair Trading Act 1989 and ordered to pay $750 professional and court costs.

"The corporation made false and misleading representations about the location of land being advertised for sale," Fair Trading Minister Keech said in a media release.

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Punishing A Queensland Rogue

Lindsay Stringer - the most unsuccessful rogue?


An article from the Jenman website.



In Queensland, where rogue agents roam, Lindsay Stringer must be the most unsuccessful of all the rogues. If not, he’s certainly the unluckiest when compared with other agents.

Last Friday (April 28, 2006), the Queensland Office of Fair Trading announced that Stringer (who formerly traded as The Professionals Shailer Park) had set up a scam in which sellers and buyers were charged higher amounts than the actual costs of expenses. For instance, pest inspections were loaded in price, as were advertising expenses.

Yep, Lindsay added a bit on for himself.

How much is “a bit”? Well, in total, Lindsay’s rip-off scheme – which took place between October 2001 and October 2002 – netted him $3,500.

When he was caught, Lindsay (who doesn’t seem the smartest of rogues) made a muddling attempt to cover-up his crime. But he was no match for the investigative skills of the Queensland Office of Fair Trading who uncovered his deeds and hauled him before the Magistrates Court.

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Real Estate Rogue Belatedly Banned For 10 Years

by Tim O’Dwyer M.A., LL.B
Queensland Solicitor & Consumer Advocate
watchdog@argonautlegal.com.au

A Queensland real estate agent and his company have been disqualified for 10 years and penalised more than $7600 for dishonest conduct.


In a recent media release Queensland’s Fair Trading Minister Margaret Keech said Lindsay Stringer, licensed principal of Stringer Corporation, trading as The Professionals Shailer Park, admitted to the Commercial and Consumer Tribunal that he had dishonestly converted trust monies.

"Stringer and his company were both disqualified for 10 years from holding licences under the Property Agents and Motor Dealers Act 2000. Stringer was also disqualified for 10 years from being an executive officer of a corporation that holds a licence under the Act," she said.

Mrs Keech said in the course of selling a property, Stringer was found to be charging consumers higher amounts than the actual costs of sale-related expenses such as termite treatments and advertising, and then pocketing the difference.

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Legalwise Seminars - Not As Wise As They Think!

by Peter Mericka B.A., LL.B Real Estate Lawyer and
Qualified Practising Conveyancer
Victoria
Lawyers Real Estate

What is going on at Legalwise Seminars? They now have an unqualified non-lawyer conveyancer as Chairperson of their upcoming conveyancing seminar. What's more, they expect lawyers to pay to attend!

We received this brochure from Legalwise seminars, inviting us to part with $300 to participate in a seminar chaired by Ms. Pauline Barrow in her capacity as President of the Australian Institute of Conveyancers (Victoria Division)(AICVIC).

Now, in our opinion, AICVIC is a strange organisation. Its membership is restricted to non-lawyers, when only lawyers are permitted to provide legal advice and to perform the legal work associated with conveyancing matters in Victoria.

As AICVIC members are prohibited from involvement in the legal work associated with conveyancing transactions, they appear to have little to offer the legal profession.

AICVIC also asserts that there is no need for consumers to use a lawyer in conveyancing transactions.

So, what we have is a situation where the President of an organisation, which suggests to consumers that the lawyer should be displaced from the conveyancing transaction by an unqualified conveyancer, is to chair a lawyer's training seminar.

Does this mean that we can expect Enzo Raimondo of the Real Estate Institute of Victoria (REIV), whose organisation encourages its members to displace lawyers at the contract stage of a real estate transaction, to chair seminars on real estate contacts? Will Legalwise have the publishers of Australian Legal Will Kits chair the seminars on Wills & Estates?

Legalwise, what were you thinking?

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