Hamilton realtor Lugton's fined $1 mln for price fixing

Monday 19 December 2016 11:24 AM

Hamilton realtor Lugton's fined $1 mln for price fixing

By Paul McBeth

Dec. 19 (BusinessDesk) - Hamilton realtor Lugton's has been ordered to pay $1 million by the High Court in Auckland, joining a growing number of real estate agencies who have admitted they'd colluded to pass on increased Trade Me Group fees for property listings as part of a response to the auction site’s increasing dominance in the market.

The real estate agency is the second in Hamilton to appear in court after reaching a settlement with the Commerce Commission over a planned regional response to Trade Me's pricing model, the regulator said in a statement. The commission said Justice Paul Heath called Lugton's "an important player" while acknowledging it wasn't an instigator.

"Lugton’s admitted that it had agreed with the other defendants that each of them would pass on the cost of listing on Trade Me to vendors who wished to have their properties listed for sale on Trade Me," the commission said. "Lugton’s also admitted that it agreed with the other agencies that vendors’ existing listings would be removed from Trade Me. This conduct constituted unlawful price fixing."

Lugton's was ordered to pay the penalty on Friday, the same day Barfoot & Thompson, Harcourts, LJ Hooker and Ray White were fined a combined $9.8 million for colluding at a national level.

The competition watchdog reached settlements with Bayleys at a national level, as well as Success Realty (trading as Bayleys in Hamilton) and Manawatu-based Unique Realty and Manawatu 1994 (trading as LJ Hooker) at a regional level, and court-imposed penalties have reached $16.4 million including Lugton's fine.

Property Page (NZ), which operates the realestate.co.nz site, has also agreed to pay $100,000 towards investigation costs as part of its settlement.

Hamilton realtors Monarch Real Estate trading under the Harcourts banner, Lodge Real Estate, Online Realty trading as Ray White, and two other individuals are still defending the charges, with a hearing set down for September next year.

The regulator also warned eight other agencies for their conduct. The agencies were Coast to Coast (trading as Bayleys), Alrose (trading as REMAX Palmerston North), Rural and Lifestyle Sales.com, Real Estate House Manawatu (trading as Ray White), Harcourts Team Manawatu Realty, Watson Real Estate, PGG Wrightson Real Estate and Monty’s Real Estate.

(BusinessDesk)

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