The Property, Stock and Business Agents Act 2002 requires an agent to be a fit and proper person to hold a real estate licence. Sounds straightforward, right? But if you fail the test, your licence could be cancelled.
So, ask yourself: “Am I a fit and proper person?”
What does a fit and proper person look like? Do you have to run a four-minute mile, bench press 200 kilograms and follow Downton Abbey-esque etiquette? Well, no.
The overarching purpose of determining whether an agent is a fit and proper person is protection of the public.
The basic test involves three things: honesty, knowledge and ability.
Still not clear? Luckily, the NSW Civil and Administrative Tribunal has dealt with several cases in which agents failed the fit and proper person test. These cases are now studies of what not to do as a real estate agent.
In Salcedo v Commissioner of Fair Trading , NSW Fair Trading cancelled an agent’s licence for previous convictions relating to shoplifting and theft.
He appealed the decision to the Tribunal.
While the shoplifting offence was minor (resulting in a $150 dollar fine), the agent was also convicted of larceny and dishonestly obtaining property by deception in relation to a stolen credit card.
The agent expressed remorse and said the offences were committed out of desperation (he used the credit card for food).
Despite the agent's age and circumstances when the crime was committed, his application was rejected because he failed to disclose his convictions when completing his real estate licence application form.
The Tribunal noted this rejection did not prevent him from applying for his licence in the future.
Whether or not sufficient time has passed to ignore previous offences has been considered by the Tribunal in many cases. However, no clear rule has been established.
In Porter v Department of Finance and Services , an agent almost lost her licence for non-compliance with the PBSA Act.
In 2012, the PBSA Act was amended to include a requirement for mandatory professional indemnity insurance.
A senior investigator from NSW Fair Trading's Consumer Protection Team attended the agent's office and requested proof of her insurance, which she was unable to produce.
The Tribunal found the agent was in breach of the PBSA Act, but issued a caution instead of cancelling her licence.
These cases demonstrate that non-compliance with real estate industry regulations could result in the loss of your licence. So are you a fit and proper person?