Code of Conduct – Part 3

The College of People Management and Development_Do I need to register with the PPRA_Summary_Code of Conduct Part 3

Code of Conduct – Part 3

Last week we started discussing Regulation 34.3 of the Code of Conduct.  This week, we turn our attention to Regulation 34.3.2, which is interestingly entitled: Duties applicable to estate agents.


A summary of Regulation (Reg) 34.3.2 follows below:


  1. Reg – as a PP, you must indicate to a prospective purchaser or lessee, all facts concerning such property, as are, or should reasonably in the circumstances be, within your personal knowledge and which are or could be material to the prospective purchaser or lessee. There are a number of important issues to consider here.  Firstly, as the PP, you must convey the facts to the prospective purchaser or lessee.  The seller or landlord cannot tell you to keep quiet and not disclose things like defects in the property.  Furthermore, refer to the blogs that I have written about the mandatory disclosure form.  Secondly, the facts that need to be disclosed by the PP are those facts that the PP knows about or should reasonably know about.  Hence, it would not be acceptable for the PP to say to a prospective purchaser or lessee that he did not know about certain issues in the property.  The question would be, should the PP have known about the issues relating to the property.  Thirdly, the facts that the PP must disclose, need to be material to the prospective purchaser or lessee.  This is not entirely clear cut.  Issues that may be material to one prospective purchaser may not be material to another prospective purchaser.  As the PP, the question you need to ask yourself is, is the fact that the roof is leaking, for example, something that would be important for a purchaser or lessee to know about?  Whether a defect or issue relating to the property is material, largely relates to what impact it would have on the decision making of the purchaser or lessee.  Hence, would the purchaser not have bought the property if they had known about the defect or issue?
  2. Reg – if a PP conducts their business under a trade name or a name other than their own name, the PP must then disclose their full name in all their correspondence, circulars and other written documentation.
  3. Reg – a PP may not accept two mandates that will conflict with each other. As an example, let us say that a prospective purchaser gives a PP a mandate to find a property that is painted pink with purple spots and the PP accepts that mandate to seek such a property for the client to purchase, then the PP may not accept a mandate from a seller who wishes to sell their property, which is painted pink with purple spots and which would be suitable for the purchaser who has already given the PP a mandate.  Therefore, in respect of a particular property, the PP can only have one client.
  4. Reg 34.3.3 – a PP may not purchase or lease a property where the PP has a mandate relating to that property, unless the person who has given the PP the mandate relating to that property, is fully aware of the PP’s interest in the property and has consented to the PP having such interest in the property. A simple example would be that a PP cannot buy their client’s property, either directly or indirectly, without the client knowing that the PP that holds the mandate to sell the property, is the person that wants to buy the property and the client has consented to this.


Next week we will discuss the PP’s duty of disclosure and duty not to make misrepresentations.


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