Auckland District Law Society Inc reports the view of David Bigio, a lawyer who has presented seminars about the new Real Estate Agents Act 2008, that the new Act will result in changes in agency relationships between consumers and real estate agents. The most notable outcome perhaps being that lawyers, who in the past have been used to getting contracts after they had been signed, will find that they were being asked for advice at an earlier stage.

Sweeping changes to the way in which the real estate industry is regulated will take effect on 17 November 2009, when the Real Estate Agents Act 2008 comes into force. The new legislation is designed to update the current 1976 act and provide greater protection for consumers by introducing more modern and robust complaints and disciplinary regimes.

Under new Professional Conduct and Client Care Rules for the real estate industry, real estate agents will be required to ensure that prospective clients were aware that they could - and might need to - seek legal or other advice.

Mr Bigio, who has advised on and conducted prosecutions for the Real Estate Institute of New Zealand (REINZ) for over a dozen years, reportedly said that it would be important for lawyers to be informed about the details of the new complaints and disciplinary processes governing the real estate industry, so that they could provide advice to clients who were unhappy about their dealings with real estate licensees.

The new Act provides for new disciplinary outcomes for unsatidfactory conduct and misconduct.

Misconduct can result in a real estate agent being:

• reprimanded
• ordered to apologize
• ordered to undertake further training
• ordered to refund fees
• ordered to rectify an error
• fined up to $10,000 for an individual or up to $20,000 for a company, or ordered to pay the costs of the inquiry or investigation

In serious cases involving misconduct, the committee will lay a charge with the tribunal, which will have heftier penalties at its disposal, including:

• cancelling or suspending licences
• ordering that the licensee's employment be terminated
• ordering payment of up to $100,000 compensation to complainants for actual loss suffered.