Media Release
Issued 14 February 2008/No 106
Real estate agent, and his company, admits misleading advertising
A Wellington real estate agent, and the company he worked for, has admitted advertising a property in a way that was
likely to mislead potential buyers, in breach of the Fair Trading Act.
The Commerce Commission launched an investigation in December 2007 following a complaint from the Wellington City
Council.
The complaint related to a section of land in Newlands, Wellington being marketed by agent John Willcox of Team
Wellington Limited (trading as Harcourts Kilbirnie). On the website www.open2view.co.nz the 1,358m2 property was
described as having “provisional resource consent for six executive quality detached town houses”.
The Commission’s investigation found that there is no such thing as “provisional resource consent”, and that no resource
consent had been applied for. The Commission did not receive any complaints from the viewing public.
In an out-of-court settlement with the Commission, Mr Willcox and Team Wellington Limited have admitted breaching
section 14(1) (b) of the Fair Trading Act 1986. As a condition of the settlement, Mr Willcox is required to undertake at
least six compliance training sessions being conducted by Team Wellington Limited or the real estate industry within the
next 12 months. Likewise, an independent audit of Team Wellington Limited’s compliance procedures will be conducted,
with emphasis placed upon Fair Trading Act compliance. Team
Wellington Limited will be required to institute any recommendations made by the independent auditor.
Commission Chair Paula Rebstock says, “If competition in the real estate market is to be effective, real estate agents
must provide accurate information about the properties they sell.”
“Home buyers rely, and are entitled to rely on, claims made by real estate agents in advertising, promotional materials
and on websites relating to the property. Real estate agents, and the companies who employ them, must ensure that they
do not intentionally or unintentionally mislead those buyers” says Ms Rebstock. In reaching the settlement the
Commission has taken into account the immediate action taken by Mr Willcox to remove the offending reference from the
website when it was drawn to his attention, and the limited exposure of the offending wording.
Background Section 14(1) (b) of the Fair Trading Act states: (1) No person shall, in trade, in connection with the sale
or grant or possible sale or grant of an interest in land or with the promotion by any means of the sale or grant of an
interest in land,- (b) Make a false or misleading representation concerning the nature of the interest in the land, the
price payable for the land, the location of the land, the characteristics of the land, the use to which the land is
capable of being put or may lawfully be put, or the existence of availability of facilities associated with the land.
Breaches of the Fair Trading Act may result in prosecution in court. Companies found guilty of breaching provisions of
the Fair Trading Act may be fined up to $200,000 and individuals up to $60,000. Only the courts can decide if the Fair
Trading Act has been breached.
ENDS