Reference no: EM133022816

RES420 Fundamentals of Real Estate

TASK 1

i. Yes, you can definitely apply for Salesperson if you are 18 years or older, However, in addition, you will also need to demonstrate that you are honest, a fit person & have the right qualifications & experience. You will need to have New Zealand Certificate in Real Estate (Salesperson1) Level 4 or National Certificate in Real Estate (Salesperson1) Level 4.

ii. In this case, the stand down period is 5 years, Hence, you have had it cancelled for 4 years under section 54(d), because you failed to complete requisite study which was required by practice rules made by the authority pursuant to section 15and now will need to wait one more year to re-apply, you can't re-apply for your license at this stage under section 37(d)(i) of real estate agents act 2008.

iii. Lawyers and conveyances can carry out real estate work without a real estate licence. However, lawyers cannot hold both a real estate licence and a legal practising certificate as per Real Estate Act 2008 as per Section 7 (1)a and 7(2). Real estate agency work can be carried out, However in respect of the sale or other disposal of any land/business which is not entitled to be remunerated for a particular work by commission or instead of the professional charges of that lawyer or convincing practitioner.

iv. No, you cannot become a branch manager under section 36(e) of real estate agents act for now , to Become a Branch Manager you will need to do following
1. Complete New Zealand Certificate in Real Estate (Branch Manager) (Level 5) or National Certificate in Real Estate (Branch Manager) (Level 5) or Schedule 3 university degree and ITO assessment
2. Complete Work Experience of 3 years in Real Estate
3. Apply for License using guidelines provided by REA

v. Under section 47 of real estate agents act 2008, A licence cannot be transferred and may not vest by operation of law in any person other than the person to whom the licence has been granted regardless of being their family member or an outsider. Hence, you would need to apply for your own license with REA based on their criteria.

TASK 2

i. This behaviour breaches several rules of the code, 6.4 A licensee must not mislead a customer or client, nor provide false information, nor withhold information that should by law or in fairness be provided to a customer or client. 9.4 Code states, A licensee must not mislead customers as to the price expectations of the client,
10.4 An advertised price must clearly reflect the pricing expectations agreed with the client. Hence this is to be considered as misconduct under section It is Misconduct under section 73 (b).

ii. Salesperson failed to comply with 9.6 unless authorised by a client, through an agency agreement, a licensee must not offer or market any land or business, including by putting details on any website or by placing a sign on their property. As per 6.2, a licensee must act in good faith and deal fairly with all parties engaged in a transaction. And 5.1 A licensee must exercise skill, care, competence, and diligence at all times when carrying out real estate agency work. Hence, this is misconduct, Act 73.

iii. As the Salesperson failed to supply signed agreement & contractual document, he failed to comply with section 132 & breached rules 10.11, 10.2 and 5.1. Client wasn't aware about the price of property hence, Salesperson failed to exercise skills, care, competence and diligence during his real estate work, failed to provide appraisal of land. As per section 73(b), this case of serious misconduct due to negligence of work.

iv. As per section 127(1) and 132(a) , Sales person Complied with Rules 9.7a, 10.7 & 5. He carried skill, care, competence and diligence and advised his customers to seek some legal advice. He made the customer aware about faults in property. Salesperson supplied approved guide and had a it signed a proof of customer receiving the guide.

v. Salesperson did not inform customer about construction & misled by not informing about the sale of adjacent land, removal of bush from back boundary. He failed to follow rules 10.7(b), 6.4 and 6.3 & section 151 as he failed to disclose conflict of interest & did not comply with section 136(1) because he did not tell the customer that his parents were getting the benefit. It was misconduct by salesperson under section 73(c)(i) as he wilfully made contravention of real estate agents act 2008.

TASK 3

i. Ferngully Realty Limited, Licensed under Real Estate Act 2008, wasn't showing anywhere on the advert which is a matter of concern. An agent of Ferngully Realty Limited which is a licensed firm, or a branch manager could have assisted the salesperson as he was new. I would really try to amend this by discussing the issue with Branch manager or agent. There could be general penalty under section 138 agent or salesperson can be fined up to $40,000 according to section 138(a) or firm can be fined up to $100,000 under section 138(b). I would make sure that Branch manager or an agent is clear about the fact that their name is not mentioned on advertisement because the advertisement still states firms name which is Ferngully Ltd which should have been published as per Section 121(2c) on advertisement. I would suggest correcting this mistake before an action is taken against this error.

ii. Renewal notice was not received by Brad as he moved to a new area and his address was not updated in REA register, So I will advise him to notify the register about the changes ASAP. There is a possibility that his renewal notice was delivered to his old address. As per Section 67 (1), Brad should supply a written notice to registrar for any change is his circumstances within 10 working days. Under Section 67(2a), Changes can be a change to address or change to a new agency which in this case is Ferngully Realty Limited. Under Section 52 (1) , I would suggest Brad to immediately make an application for renewal of his license before it expires, section 67 of Real Estate Agents Act 2008. According to Section 145(1), failure to update the register on changes is an offense, as section 145(2a) he can be fined up to $10,000.

iii. Stevie tells Marc to purchase the property without declaring "conflict of interest" which is an offense under section 151. She also breaches Section 135 which states client should get valuation at licensee's expense which of course Stevie didn't want to organise. Stevie Further adds to buy the property on her friend's name and then transfer it to her name on the final settlement which is illegal under section 134 (2) as no licensee can carry out agency work in respect of transaction, if the licensee knows that transaction will or likely to result in a person related to him getting that property. Not Only Stevie but Also Marc will breach the act 134(2) as Marc and Stevie are colleagues, they both are licensed by same real estate agency. I would advise them on the breaches & will leave it to Marc to take his call; however I will also suggest, I wouldn't have done any such offense and will suggest them not to breach the any sections under the Act and comply with them.

TASK 4

Sales People of Ferngully Realty Limited should discuss the complaint with higher management to get a better understanding on what next needs to be done, however, they should have a root cause analysis on the complaint, a proper information on why that happened, what can be done to fix the current problem and what procedures can be taken in future to avoid those. There must be written in-house procedures for dealing with complaints and dispute resolution. A Copy should be accessible to all, Clients and Customers. Following Codes by REA should also be taken into account while dealing with a complaint.

12.2 Customers and Clients should be aware on procedures before they enter into any contractual agreements.

12.3 Customer & Clients should be aware Authority's complaints process without first using the in-house procedures & it does not stop them making a complaint to authority.

12.4 A licensee employed should advise an agent within 10 working days of becoming aware for any complaint made to the Authority against them, the decision of the Complaints Assessment Committee made in respect of that complaint, any order made by the Committee in respect of complaint & If the matter proceeds to the Tribunal, the decision of the Tribunal.

12.5 The licensee must also provide the information referred to in rule 12.4(a) and (b) to that agent within 10 working days of becoming aware of the complaint if they were engaged by another agent at that time.

Attachment:- Fundamentals of Real Estate.rar