By Nancy Rainbird – Claims & Compliance Manager at Realcover
||There are many factors that go into a decision to buy a property, and whether or not there is a car space on title can be an important decision-making factor. Purchasers’ expectations can be quite specific when it comes to car space requirements.
In inner city areas, for example, some purchasers will place a high premium on having a car space on title, as on-street parking pressures increase and paid parking becomes more and more expensive. If a car space is located under shelter or is in a secure environment, then it has the potential to have a real impact on the overall value of the property.
So correctly specifying the particulars in relation to car spaces is critically important.
In recent months, Realcover has received a number of enquiries from agents that specifically relate to car spaces.
In one instance, a sales agent on instruction from the vendor advised a purchaser that the property included a car space, however the executed contract did not include a car space. The purchaser threatened to proceed with a damages claim against both the vendor and the agent for misleading and deceptive conduct.
In another instance, an agent marketed and sold the property in question with one car space. The purchaser alleged that they purchased the property on the basis of a large undercover area that was pointed out by the agent to be the car space, but which was not in fact the correct car space.
Caveat emptor, or buyer beware, is a commonly known principle of property law. However, court cases have shown that a real estate agent will be liable to any purchaser for the loss flowing from a misrepresentation made by the agent. This is the case regardless of the fact that the contract for sale includes clauses to the effect that the purchaser cannot claim compensation for any alleged insufficiencies. However, an agent will not be liable unless it is proven that the purchaser of the property actually relied on the information that was presented by the agent.
Therefore, it is not enough to rely on provisions in the contract for sale as a defence to such a claim. Agents must be attentive when ensuring that appropriate measures are in place to avoid allegations of misleading or deceptive conduct.
It is important to confirm that the details provided in relation to the property are in fact correct. Agents must ensure they obtain these details in writing from the vendor or their solicitor prior to commencing the marketing campaign for the property.
The Licensee-in-charge should ensure this is common practice within the business, so that all information put forward to the public is correct from the very beginning.
In the case of a car space in particular, ask the vendor to physically show you the space – this way there is no confusion.
When it comes to documents such as brochures, flyers, sign boards and any online advertising, use the same font size throughout, including where there may be any disclaimers. This avoids important details getting lost in the fine print.
Once the advertisements are confirmed, request that the vendor checks and signs off on them before they are released. It is also a good idea to send a copy of the marketing material to the vendor’s solicitor. Furthermore, checking the contract for sale to ensure that the details are consistent with the previous details issued from the vendor is a way to avoid any miscommunication.
While being proactive is essential in order to avoid claims, always remember that adequate professional indemnity insurance is also important. Taking a few simple measures could see you avoid any potential claims of misrepresentation.
Let Realcover protect your business with professional indemnity insurance designed with your needs in mind. When it is time to renew your policy, contact Realcover on 1800 990 312 for a quote. REINSW members receive a discount.
While care has been taken preparing this article, and the information contained in it has been obtained from sources that Realcover believe to be reliable, Realcover does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose that the article may be used. Realcover accepts no liability for any loss or damage (whether caused by negligence or not resulting from the use of this article).