Real Estate Documents – Don’t Be A Goose!
OPINIONby Peter Mericka B.A., LL.B
Real Estate Consumer Advocate
Real Estate Lawyer
Qualified Practising Conveyancer Victoria
Director Lawyers Real Estate Pty Ltd
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”!
Force Feeding Is Illegal
How is it that estate agents so regularly break the law and treat consumers like geese?
It all comes down to legislation which allows estate agents to fill in blank contracts. The legislation was designed to allow estate agents to assist purchasers by providing a standard sale form where the purchaser had no legal representation.
Estate agents have turned this assistance role into a bullying tactic by requiring that purchasers must allow the estate agent to prepare the purchaser’s offer on the estate agent’s terms.
Lawyers and conveyancers have confirmed this role for the estate agent, collaborating with estate agents, and limiting their own role in the process. (Many lawyers and estate agents have cosy relationships with estate agents involving the payment of secret commissions in return for conveyancing referrals).
While the use of bullying and force-feeding tactics are a common feature of real estate sale transactions, they do remain quite illegal.
This is because real estate agents are required by law to deliver all offers to the vendor:
“ESTATE AGENTS (PROFESSIONAL CONDUCT) REGULATIONS 1997 – SECTION 18:
18. Communication of offers
An agent must communicate all offers to his or her principal as soon as possible.”
We advise all consumers to obtain pre-purchase legal advice, and to avoid lawyers and conveyancers who are recommended to them by the estate agent. Remember that the use of a lawyer or conveyancer on the basis of an estate agent’s referral is the start of the force-feeding process.
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