Underquoting laws fail homebuyers
LAWS meant to stop underquoting are in disarray after an estate agency was acquitted of criminal charges because it created an artificial corporate structure that insulated it against liability.
NSW
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EXCLUSIVE
STATE laws designed to stop real estate agents underquoting to make more sales are in disarray after one agency was acquitted of criminal charges because its “guiding minds” had created an artificial corporate structure that insulated it against liability.
Blacktown Local Court magistrate Roger Brown yesterday found Darlinghurst-based BresicWhitney not guilty of five alleged breaches of the Property Stock and Business Agents Act following the first prosecution of its type in 12 years.
The action had been brought by NSW Fair Trading, which the BresicWhitney legal team caught off-guard with the surprise argument that the agents who allegedly understated prices in late 2014 were not actually employed by the charged entity.
Sources last night told The Saturday Telegraph the structure used by BresicWhitney was now commonplace in Sydney’s booming real estate industry.
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It is a major embarrassment to Minister for Better Regulation Victor Dominello, who has responsibility for NSW Fair Trading and oversaw the introduction of the much-hyped underquoting laws in January. He would not comment yesterday.
Dr Brown said in his published reasons the fundamental question in the case was whether criminal liability for any of the alleged offences “attaches to the defendant corporation”.
He concluded it had constructed a “corporate structure with the aim of insulating the defendant corporation against vicarious criminal liability”.
“The defendant corporation BresicWhitney Estate Agents Pty Ltd (BWEA) was a licensed corporate estate agent. All individuals (again, to use a neutral term) responsible for any of the pricing statements the subject of these proceedings were actually employed by, or acting for, the employer BWEA Employees Pty Ltd (BWEE) which is not a licensed real estate agent.”
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Neither of the agency’s directors Ivan Bresic or Shannan Whitney (pictured) was in court to hear the verdict. Later, both declined to answer questions.
In a statement, the agency said: “BresicWhitney is delighted with today’s decision.”
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