Former realty agent Aaron Hughes is on trial in Auckland District Court. Photo / Supplied
Former realty agent Aaron Hughes is on trial in Auckland District Court. Photo / Supplied
After a reporter phoned about a property deal in which he'd made $720,000 profit, an "agitated" Barfoot & Thompson agent Aaron John Hughes called his boss.
"I'm f***ed," Hughes told the firm's Papatoetoe branch manager Paul Davis.
Davis, who gave evidence today on the second day of Hughes' trial at Auckland District Court, immediately drove to Hughes' Flat Bush home to confront him.
The court heard that Hughes admitted buying a Lynton Rd, Mt Wellington house from elderly Waikato brothers Jack and Walter Tata for $530,000 in February 2015 in a private treaty sale.
With no major renovation work, he on-sold the property a few months later for $1.255 million.
This property at 51 Lynton Rd, Mt Wellington was on-sold in 2015 for a $720,000 quick-fire profit. Photo / Greg Bowker
When details of his alleged windfall came to light, Hughes was referred to the Real Estate Agents Authority (REAA) and now faces two charges of causing loss by deception.
Hughes denies the charges, which relate to two separate Auckland properties. His lawyer says there was no deception and Hughes was not acting as a licensed agent.
It was April 2016 when Davis arrived at Hughes' house. Hughes told his boss a Herald journalist was preparing a story on the Lynton Rd transactions.
The young but experienced agent was agitated and upset, Davis told the court.
Asked what Hughes said, Davis replied: "I recall specifically, he said, 'I'm f***ed'.
"He was clearly concerned about what that would mean for his reputation as a real estate agent and his future with Barfoot & Thompson.
"I said, 'As far as Barfoot & Thompson goes, yep, that's about that'."
While the initial sale was conducted privately, the second was through Barfoot's Panmure branch and Hughes earned a "referral fee", the court heard.
Davis told the court he was shocked to learn how much Hughes made on the deal.
"Just the amount of difference. [It's] not the amount on the second sale price that was astounding, but the amount he paid on the initial purchase was staggeringly low."
Davis said he ended Hughes' contract with the company on the spot. He also arranged for Hughes to come into the office at some point, "but he never did".
Crown prosecutor Michael Hodge asked Davis what he would have done had he learned about Hughes' huge profit earlier.
"My role would have been to pass that information upwards to our managing director Peter Thompson who in most cases would have passed it on to the Real Estate Agents Authority.
"To more than double [the price] in three and a half months would certainly have caused some attention, particularly if it was one of my agents as the purchaser."
Thompson also gave evidence. After being alerted to Hughes' transactions by the Herald, he immediately called Davis and referred the matter to the REAA.
Thompson also authorised a search of Hughes' Barfoot emails for evidence relating to the sales.
"We had no record in our listings or sales [of the Tata transaction] and to do that we needed to check the emails."
The search uncovered a valuation for 51 Lynton Rd emailed to Hughes 11 days before he bought the property stating it was a "developer's dream" and worth at least $1.2 million.
The email was never disclosed to the two pensioners, which the Crown says was a breach of professional duties.
Legal executive Raewyn Yelavich acted for the Tatas and told the court she felt Hughes' purchase price was "very low" at $100,000 below CV.
She was also surprised to learn that Hughes later negotiated a $5000 discount after thieves ripped out copper piping and a hot water cylinder.
"I thought that was a bit cheeky considering he was getting the property for a good price."
She flagged her concerns with the Tatas but they wanted to proceed, she said.
