Article

East London estate agents banned

OFFICE OF FAIR TRADING News Release (179/07) issued by The Government News Network on 20 December 2007

The OFT has issued a prohibition order against a firm of East London estate agents, Lloyds Residential Property Services Ltd, and one of its directors, Patrick French, banning them from estate agency work. A warning order was also made against one of the company's employees, David Estall.

An adjudicator found that Lloyds, Mr French and Mr Estall failed to forward offers promptly and in writing to their clients, and failed to disclose their personal interest to purchasers in respect of two properties. One of the properties was owned by Mr Estall. The adjudicator also found that Lloyds and Mr French fabricated letters to the OFT in an attempt to conceal their actions.

Mike Haley, OFT Head of Consumer Protection said:

'Estate agents who have a personal interest in a property that they are marketing must declare this without fail. Fabricating letters to the OFT when it is carrying out an enquiry is of the utmost seriousness, and we have demonstrated that where necessary we will take the strongest possible action against them.'

NOTES

1. The OFT can take action with a view to banning from estate agency work a person (and for the purposes of the Estate Agents Act this can also be a company or a partnership) who has been convicted of certain specified offences such as fraud, or other dishonesty or violence; or who has committed racial or sexual discrimination in the course of estate agency work; or who has failed to comply with the requirements placed on estate agents by the Estate Agents Act 1979 and its associated regulations ('the Act'), or who has engaged in specified undesirable practices, if an adjudicator finds that the person in question is unfit to act as an agent.

The OFT can make a Warning Order if it satisfied that a person in the course of estate agency has failed to comply with a statutory obligation or has engaged in a practice which has been declared undesirable by the Secretary of State. The OFT can bar from estate agency work a person who fails to comply with the Order and/or continues these undesirable practices in future.

2. Before a Prohibition or Warning Order is issued, the person concerned has the right to make representations to the OFT as to why the Order should not be made. If these representations are unsuccessful, subsequent appeal can be made to the Department for Business, Enterprise and Regulatory Reform.

3. Adjudicators issue and determine Prohibition and Warning Notices under the Act. They do so on behalf of the OFT, but make individual and independent decisions based upon the contentions in a Notice, the evidence attached to a Notice and the representations of those to whom a Notice is addressed. Representations may be made in writing and at an oral hearing.

4. An adjudicator determined that Lloyds, Mr French and Mr Estall breached the Estate Agents Act 1979 and the Estate Agents (Undesirable Practices)(No.2) Order 1991. A Prohibition Order was made in respect of Lloyds and Mr French on 5 December 2007. A Warning Order was made in respect of Mr Estall on the same day. The Orders will not come into operation until the period in which any appeal could be made under section 7(1) of the Act has expired. Lloyds, Mr French and Mr Estall have until 2 January 2008 to lodge such an appeal.

5. Section 21 of the Act requires an estate agent to disclose to prospective purchasers that a connected person has a personal interest in the sale of a property. A connected person includes an employee and an associate of the estate agent.

6. Under the Estate Agents (Undesirable Practices)(No.2) Order 1991 an estate agent must forward to his client promptly and in writing accurate details of any offer the estate agent has received from a prospective purchaser in respect of an interest in the land.

7. After an Order has been made, the person affected can at any time, and on payment of a fee, currently £2,500, apply to the OFT for the Order to be varied or revoked.

8. The Act covers anyone who, in the course of business, is engaged in 'estate agency work'. This means introducing to someone else a person who wishes to buy, sell or lease land or property, and/or being involved in negotiating the subsequent deal. The work must be in the course of business, whether as employer or employee, and as a result of instructions from a client. The land or property may be commercial, industrial, agricultural or residential.

http://www.oft.gov.uk

PUBLIC enquiries: 0845 7224499 enquiries@oft.gov.uk
OFT reports and consumer information leaflets are available free from:
OFT, PO Box 366, Hayes UB3 1XB 0800 389 3158 oft@ecgroup.uk.com