Responsibilities of Staff

2023-07-06

Custom and Common Law Responsibilities

Custom and common law generally covers the dealings of the estate agent with the seller and not the buyer. As part of good practice, these laws are often extended to an agent’s dealings with a buyer. Custom and common law duties of an agent toward their seller or client include not to allow conflicts of interest to arise, to act honestly in the interests of the seller and to carry out any lawful instructions.

These requirements form the basis for the various codes of practice and ethics which have been produced by a number of professional bodies. The rules of which extend to the estate agent’s dealing with buyers as well as sellers, although it is not mandatory for an estate agency to belong to any professional body as anybody can set up at any time as an estate agent. However, common and statue law will apply to the activities of all those engaged in estate agency work and the various codes of practice will be taken by the courts to be the normal expectations of agents where disputes arise.

Statutory Responsibilities

In addition to common law guidelines, there are a number of statutory requirements that need to be adhered to, as follows:

• Provision of Information Regulations 1991
• Undesirable Practices Order 1991
• Consumer Protection from Unfair Trading Regulations 2008

Statue law makes it mandatory for certain information to be given to sellers and buyers in writing at the earliest opportunity.

The Consumers, Estate Agents and Redress (CEAR) Act 2007 requires residential estate agents to belong to a redress scheme. Two have been approved and all residential agents must belong to one or other. The schemes offer consumers a ‘referee’ in cases where complaints are made against estate agents.

Personal Interests and Connected Persons

Statue has defined what is a personal interest and who connected persons are. The definition of the latter is very wide and covers the extended family. Agents are advised to devise prompt sheets for employees to ensure that questions about connections are asked of both sellers and buyers.

Consumer Protection Legislation (CPR)

CPR applies to all businesses and the OFT published some guidance in September 2012 in relation to the regulations. The guidance seems to imply that an estate agent must provide buyers or applicants with all the information they would need to make an informed decision about whether or not to go ahead with a viewing, make an offer, buy the property etc.

Under previous legislation, estate agents were not required to disclose any information about properties they were selling. So saying nothing about structural problems, for example, to a potential buyer would not be in breach of any legislation or common law. It had always been seen as the buyer’s responsibility to find out these things for themselves.

It is arguable that now CPRs will require the estate agent to point out to a buyer that a property has serious structural problems at the outset, or point out other detracting features if this could be seen as a material point that the buyer should be aware of in order to make a decision about viewing or buying.