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Real Estate Agents Act 2008

Duties relating to real estate agency work - Disclosure of information as to transaction and conflicts of interest

134: Contracts for acquisition by licensee or related person may be cancelled

You could also call this:

"Agents can't secretly buy properties they're helping clients with, without permission"

Illustration for Real Estate Agents Act 2008

You cannot buy a property or business that you are helping a client with, unless the client agrees. You must get the client's consent in a special form and give them a valuation as stated in section 135. If you do not follow these rules, the client can cancel the contract. You are not allowed to help a client with a property or business if you know it will be bought by someone related to you. The client must be told about the valuation as stated in section 135. If you break these rules, the client can cancel the contract and you will not get paid. If you have already been paid, the client can ask for their money back. This rule applies even if you have an agreement that says something different, and it also applies to your branch manager and salespeople. You and your team must follow these rules when working with clients on properties or businesses, as stated in section 135.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1152130.

Topics:
Money and consumer rights > Consumer protectionHousing and property > Buying and selling homesBusiness > Industry rules
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133: Approved guide to be provided when contractual document provided, or

"Real estate agents must give you a guide before you sign to sell a house"

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135: Client to be provided with valuation, or

"Get a valuation to help you make informed decisions when working with a real estate agent"

Part 5Duties relating to real estate agency work
Disclosure of information as to transaction and conflicts of interest

134Contracts for acquisition by licensee or related person may be cancelled

  1. No licensee may, without the consent of the client for whom he or she carries out real estate agency work in respect of a transaction, directly or indirectly, whether by himself or herself or through any partner, sub-agent, or nominee, acquire the land or business to which the transaction relates or any legal or beneficial interest in that land or business.

  2. No licensee may, without the consent of the client, carry out or continue to carry out any agency work in respect of a transaction if the licensee knows or should know that the transaction will, or is likely to, result in a person related to the licensee acquiring the land or business to which the transaction relates or any legal or beneficial interest in that land or business.

  3. The client’s consent is effective only if—

  4. given in the prescribed form; and
    1. the client is provided with a valuation in accordance with section 135.

      1. The client may cancel any contract—

      2. made in contravention of subsection (1); or
        1. brought about by agency work carried out in contravention of subsection (2).

          1. No commission is payable in respect of any contract of the kind described in subsection (4), regardless of whether the client cancels the contract.

          2. The client may recover any commission paid in respect of any contract of the kind described in subsection (4) as a debt.

          3. For the purposes of this section, a person who is the client of an agent in respect of a transaction is also the client of any branch manager or salesperson whose work enables the agent to carry out real estate agency work for that client.

          4. This section and section 135 have effect despite any provision to the contrary in any agreement.