Wall of shame


An estate agent acted for both the purchaser and the vendor in a commercial property transaction. Though the agent knew the cockloft inside the property involved unauthorised building works, he did not inform the purchaser of this. Nor did he check whether there was an entry regarding the works registered against the property by conducting an up-to-date land search.

The agent then arranged for the parties to sign a preliminary sale-and-purchase agreement. The purchaser paid a deposit to the vendor after signing the agreement.

However, the purchaser later learned that the cockloft inside the property was illegal.

He canceled the deal and sued to get the deposit he had paid. He also lodged a complaint with the Estate Agents Authority (EAA).

According to the practice circulars regarding unauthorized building works issued by the EAA, estate agents should check the land search records to see if there is any entry registered against the property concerned.
They should also remind clients of the risks involved in the sale and purchase of property with unauthorized building works to protect clients’ interests.

Failure to comply with the guidelines in the circulars may give rise to disciplinary action by the EAA. As a result, the agent concerned was disciplined by the EAA’s Disciplinary Committee.

The Committee found that the agent had failed to comply with paragraph 3.4.1 of the Code of Ethics – in that he failed to protect the purchaser’s interests and act in a just and impartial manner to all parties concerned.