RE Agent's legal obligations

Can any real estate agents or solicitors tell me what information an agent or vendor is legally required to advice a potential purchaser of? There appears to be a requirement if there has been a murder in the property, but on the other hand there is caveat emptor. I'm particularly interested in the legality of easements. Thanks in advance for any info or if you can direct me towards someone in NSW.
 
There is no law saying they need to disclose a murder, as no one will ever be able to keep track of this stuff.

Do you have something against where a murder has taken place? If so how far back is of relevance to you and why?

Chances are someone has died at some point in time at the property, if you went back 2000 years some native might of died on your site, is this relevant to you? What about a cave man 10,000 years ago that died on the property, is this relevant?

Google the property like 'murder on smith street' and see if it comes up with something. This will give you something if recently if there was something.
 
There is no law saying they need to disclose a murder, as no one will ever be able to keep track of this stuff.

I think you might be wrong on this. There have been cases recently where agents have not disclosed murders, and been penalised.

Recent murder is far worse (IMO) than a death on the land before people lived there. Not really comparable.
 
Actually I seem to have worked out the answer to my own question. It's at PROPERTY, STOCK AND BUSINESS AGENTS ACT 2002 - SECT 52

Misrepresentation by licensee or registered person
 
There is no law saying they need to disclose a murder, as no one will ever be able to keep track of this stuff.

Oh, yes there is - google "Material Fact". The Sef Gonzales case turned caveat emptor on its head and now it is "vendor disclose" for properties where a violent crime has been committed.

The North Ryde house where the murders took place was put on the market, arousing controversy in October 2004 when the prospective buyers, a Buddhist couple, learned of the home's history. They had not been informed of the events that took place there, finding out from a newspaper only when the balance of the sale value was due. After this incident was publicised the NSW government made it illegal to sell a house without disclosing murders that took place in it. The agents eventually refunded the buyer's deposit on their purchase due to the bad publicity it caused for LJ Hooker. The real estate company was also fined $21,000. In November 2005, the house was sold for $720,000 ($80,000 less than the initial sale) to a buyer who was aware of its history

However, in relation to easements, this is laid out in the contract of sale, so there would be no need for a REA to say anything (unless specifically asked, in which case he/she would be well advised to say: "Have your solicitor read and explain the contract to you") as it is disclosed in the contract.
 
I think a lot of confusion arises because of people conflating statute law and common law. I am not (yet) a lawyer, but in some ways, that can be an advantage because I think I can still explain things in 12yo language. :)

If anything in this answer is wrong, I trust one of the several lawyers on the forum will correct any errors. Please do!

Statute law is what most people think of as "the law"; it consists of Acts and Regulations, and is the law made by Parliament. You can look up the relevant Act and it explicitly says what you can and can't do.

But there is also an enormous body of "common law", which - whilst it may not be written explicitly as "Thou shalt..." - is still binding law, just as much as statute law. Common law is huge, and governs much of contracts, torts (negligence, defamation, etc.), and many other areas of law. It consists of all the legal principles established by decisions of Courts over time, binding precedents, interpretations, and so on.

In this instance, nowhere in Australia (that I'm aware of) is there a statute that says "Sellers have to disclose if there have been murders on the property", that's true.

But... in both NSW and Victoria, there have been cases where purchasers have sued with regard to non-disclosure of a suspicious death, and in both cases, the purchasers won. Both won based on the common law principle from contracts that, if they had known, they wouldn't have entered the contract, and therefore, they had a reasonable expectation of disclosure. (Because there is a common law principle that if you know things that would reasonably cause somebody to not want to enter into a contract with you, you have to disclose it.)

Therefore, the common law in NSW and Victoria - as a result of these decisions - is that deaths that may cause a property to be "psychologically stigmatised" have to be disclosed. See: http://www.rklawyers.com/areas-of-practice/25-property-law/57-vendors-must-disclose-all-material-facts-about-property.html

If either of those cases had gone as high as the Court of Appeals (or equivalent) in those states, or the High Court, it would arguably be common law nationwide, but neither of those cases did go that high, so presently it is only common law in NSW and Victoria.

Having said that, there are now two precedential cases that would be "persuasive" (but not binding) on interstate courts in the absence of more persuasive authority, so it is likely that the result would be the same if similar cases arose in other states.

Statute law can override common law, but generally not retrospectively. So the legislatures of NSW and Victoria - or any other state - could make an explicit law saying "There is no requirement to disclose murders or suicides when selling a property", and that would then be the law and override common law (but would not change the outcomes of already-decided cases).

The position could also be reversed if a case goes to a higher court - the Court of Appeals or the High Court - and is decided differently, i.e. if one of those courts found that there's no obligation to disclose past murders or suicides.

In summary: it is certain that you currently have a common law obligation to disclose past murders and suicides in Victoria and NSW; it is likely that you would be found to have a common law obligation to do so in other states. (Unless they already have statutes saying that you don't.)
 
I am not a property lawyer, but I don't think there is any requirement for an easement to be disclosed. Non disclosure could be grounds to terminate the contract within a certain time frame, but non disclosure doesn't necessarily mean misrepresentation, unless the agent lied maybe.

I could be wrong.
 
So now you are a real estate agent and someone asks you 'has there been a murder at the property?' You know that there has been as the vendor told you.

How do you respond?

If with yes you have done the purchaser then uses this to lower the price or you don't sell the property. Making you look bad also are you obtaining the best price for your vendor who is paying you commission which you have signed an agreement that you will do what is in the best interest for your vendor to obtain the best price? Can the vendor then sue you (REA) for ruining their sale?

You answer no, purchaser buy the house and both vendor and purchaser are happy however the purchaser discovers down the track that there and looks at legal action.

I would say it becomes part of your due diligence cause what happens if the vendor knew but didn't disclose to the agent? What if both the vendor and agent didn't know as the murder happened 20 years ago and has changed hands 3x in that time?

Again everyone lies so do your own DD as buyers lie (my max price is x but will buy for y), vendors lie and agents lie (either from hearing the others lie and repeating what they believe is the truth or not seeking further clarification).

When I was a REA people would ask what price is the property and I would always respond in interest around x... Never once did I get asked whose interest is that (vendor is interested at this price, buyers have been saying this is there interest or my own personal interest at x).

Extract from http://www.realestate.com.au/blog/selling-house-history/

?The tribunal has said the agent needs to disclose it, but the vendor doesn?t. But if they make those disclosures without the authority or consent of the vendor they could be in a difficult position where they are captured under different legislation for not acting in the best interests of the vendor.?

Lose lose for the agent.
 
I think a lot of confusion arises because of people conflating statute law and common law. I am not (yet) a lawyer, but in some ways, that can be an advantage because I think I can still explain things in 12yo language. :)

If anything in this answer is wrong, I trust one of the several lawyers on the forum will correct any errors. Please do!

Statute law is what most people think of as "the law"; it consists of Acts and Regulations, and is the law made by Parliament. You can look up the relevant Act and it explicitly says what you can and can't do.

But there is also an enormous body of "common law", which - whilst it may not be written explicitly as "Thou shalt..." - is still binding law, just as much as statute law. Common law is huge, and governs much of contracts, torts (negligence, defamation, etc.), and many other areas of law. It consists of all the legal principles established by decisions of Courts over time, binding precedents, interpretations, and so on.

In this instance, nowhere in Australia (that I'm aware of) is there a statute that says "Sellers have to disclose if there have been murders on the property", that's true.

But... in both NSW and Victoria, there have been cases where purchasers have sued with regard to non-disclosure of a suspicious death, and in both cases, the purchasers won. Both won based on the common law principle from contracts that, if they had known, they wouldn't have entered the contract, and therefore, they had a reasonable expectation of disclosure. (Because there is a common law principle that if you know things that would reasonably cause somebody to not want to enter into a contract with you, you have to disclose it.)

Therefore, the common law in NSW and Victoria - as a result of these decisions - is that deaths that may cause a property to be "psychologically stigmatised" have to be disclosed. See: http://www.rklawyers.com/areas-of-practice/25-property-law/57-vendors-must-disclose-all-material-facts-about-property.html

If either of those cases had gone as high as the Court of Appeals (or equivalent) in those states, or the High Court, it would arguably be common law nationwide, but neither of those cases did go that high, so presently it is only common law in NSW and Victoria.

Having said that, there are now two precedential cases that would be "persuasive" (but not binding) on interstate courts in the absence of more persuasive authority, so it is likely that the result would be the same if similar cases arose in other states.

Statute law can override common law, but generally not retrospectively. So the legislatures of NSW and Victoria - or any other state - could make an explicit law saying "There is no requirement to disclose murders or suicides when selling a property", and that would then be the law and override common law (but would not change the outcomes of already-decided cases).

The position could also be reversed if a case goes to a higher court - the Court of Appeals or the High Court - and is decided differently, i.e. if one of those courts found that there's no obligation to disclose past murders or suicides.

In summary: it is certain that you currently have a common law obligation to disclose past murders and suicides in Victoria and NSW; it is likely that you would be found to have a common law obligation to do so in other states. (Unless they already have statutes saying that you don't.)

Came on SS for property advice, learnt about statue and common law. Great layman's explanation, love it!!
 
I think a lot of confusion arises because of people conflating statute law and common law. I am not (yet) a lawyer, but in some ways, that can be an advantage because I think I can still explain things in 12yo language. :)

You're starting to sound more like a lawyer than a 12yo. Which is probably a good thing if you are on your way to being a lawyer.

I suspect a lot of posters here would appreciate some 12yo legal education, probably just out of interest.

I thought a tort was a kind of tasty cake, lol.
 
Thanks for all your replies. In addition to the common law, I see in NSW there is the Property, Stock and Business Agents Act 2002. Section 52
states the following re an agent's obligation to reveal a 'material fact.' I believe a penalty unit is now at least $110! :eek:

52 Misrepresentation by licensee or registered person

(1) A person who, while exercising or performing any function as a licensee or registered person, by any statement, representation or promise that is false, misleading or deceptive (whether to the knowledge of the person or not) or by any concealment of a material fact (whether intended or not), induces any other person to enter into any contract or arrangement is guilty of an offence against this Act.
Maximum penalty: 200 penalty units.
(2) Without limiting the generality of subsection (1), a statement, representation or promise is taken to be false, misleading or deceptive if it is of such a nature that it would reasonably tend to lead to a belief in the existence of a state of affairs that does not in fact exist, whether or not the statement, representation or promise indicates that the state of affairs does exist.
(3) It is a sufficient defence to a prosecution for an offence under this section if the defendant proves that the defendant did not know, and had no reasonable cause to suspect, that the statement, representation or promise was false, misleading or deceptive.
 
Thanks for all your replies. In addition to the common law, I see in NSW there is the Property, Stock and Business Agents Act 2002. Section 52
states the following re an agent's obligation to reveal a 'material fact.' I believe a penalty unit is now at least $110! :eek:

52 Misrepresentation by licensee or registered person

(1) A person who, while exercising or performing any function as a licensee or registered person, by any statement, representation or promise that is false, misleading or deceptive (whether to the knowledge of the person or not) or by any concealment of a material fact (whether intended or not), induces any other person to enter into any contract or arrangement is guilty of an offence against this Act.
Maximum penalty: 200 penalty units.
(2) Without limiting the generality of subsection (1), a statement, representation or promise is taken to be false, misleading or deceptive if it is of such a nature that it would reasonably tend to lead to a belief in the existence of a state of affairs that does not in fact exist, whether or not the statement, representation or promise indicates that the state of affairs does exist.
(3) It is a sufficient defence to a prosecution for an offence under this section if the defendant proves that the defendant did not know, and had no reasonable cause to suspect, that the statement, representation or promise was false, misleading or deceptive.

Depends on what your/their interruption is of a material fact.

Asbestos?
Natural death in the house?
Accidental death in the house? (e.g. drowning in the pool)
Place flooded 20 years ago?
Unsociable activity in the street?
Closing down a school?
Mold somewhere?
Foundations need work?
Vendors are getting divorced? (you could argue that you don't want the house to have implications on your relationship)
Suicide at the property?
Tree branches have fallen on the house numerous times?
etc etc

End of the day do your own DD, listen to everything and make your own decision.

My house is about 60 years old, chances are someone has died in it at one point in time. The previous owners had young children and renovated/extended the property. The people before they might have bought from a deceased estate and now I own a property that was a deceased estate.

You have not answered why it is of importance to you or how far back is relevant to you.
 
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