All agents have to be absolutely precise when describing a property that they have been asked to market. Sales particulars must be prepared accurately, not only in terms of measurements of rooms but other relevant aspects of the property. It will be common practice for agents to have in place a procedure for ensuring the seller of the property has verified the particulars and amend them where appropriate.
The duty to ensure that sales particulars properly describe what is being marketed and are not misleading, together with the requirement for the agent to take all reasonable steps to verify what they have been told by the seller and what they themselves have seen, falls out of the Property Misdescriptions Act 1991 (supplemented by The Property Misdescriptions (Specified Matters) Order 1992).
A deliberate attempt to misdescribe the features of a property, or even a lack of care in the preparation of sales particulars can leave an agent open to a prosecution by Trading Standards with the prospect of a £5000 fine. There is, however, currently no obligation upon an agent to disclose information to potential buyers that may adversely influence them but if asked about a particular aspect an agent must respond truthfully.
The OEA Code of Practice for Residential Agents reflects the legal obligations laid down and gives guidance to assist agents by stating that “all reasonable steps” should be taken when describing property features.
In October 2008 the Consumer Protection from Unfair Trading Regulations 2008 came into force. I am not sure that a great deal of publicity to create awareness of these regulations has happened but I believe all agents (in sales and lettings) should be aware of the potential implications.
The Regulations introduce categories of misleading actions (for example, failing to honour a commitment made in a code of practice), unfair and banned practices (which includes, for example, claiming to be a signatory to a code of practice but not actually being so) and what I most wanted to highlight in this column, is the category of misleading omissions.
The precise definition in the Regulations in this regard is to “omit, hide material information or provide it an unclear, unintelligible, ambiguous or untimely manner”. The Office of Fair Trading has yet to clarify precisely the responsibilities of an agent in regards to the level of disclosure required to avoid being caught by an action for omission but they have made it clear that the Regulations override the Property Misdescriptions Act.
What is not clear is how ‘maximum’ disclosure equates to the role of an agent acting in his clients best interests in selling a property. Until a further steer is available from the OFT I will continue to judge any dispute referred to me about this issue on the basis of what I think is fair and reasonable in the circumstances.
An Important Announcement
From 1 May I have changed my title to
The Property Ombudsman (TPO).
This change better describes my jurisdiction which now covers Sales, Lettings, Commercial transactions and International transactions by members of the relevant NFOPP divisions.
New logos for agents’ branch windows have been distributed and over time (to avoid unnecessary expense) all my documentation will change.
Neither my approach nor my procedures will be different.
