Estate agents boycott new sales form

Estate agents and lawyers have revolted en masse against a new plain English agreement for buying and selling property.

Harcourts, Barfoot & Thompson, Bayleys and PGG Wrightson say they will not use the agreement for now.

Law firms are warning clients not to use the new form, at least until legal holes in it are plugged.

The form, published last month by the Real Estate Institute of New Zealand, is now competing head to head with the standard "8th Edition" sale-and-purchase agreement written by Auckland District Law Society lawyers, which has been the de facto standard for more than 20 years.

Many of the institute's own members are refusing to use the new form.

"We are waiting to make sure the contract is acceptable to the legal profession," Harcourts managing director Bryan Thomson said.

Individual real estate agents and company branches have also chosen not to use the new form. Some say the agreement is too cumbersome.

Law firm Chapman Tripp is recommending that clients and its lawyers do not use the new form because of "significant problems".

In a publication written by partner Matthew Carroll, the firm says there is too much uncertainty for buyers and sellers.

"There will inevitably be increased disputes, which will result in higher legal and other transaction costs."

Mr Carroll points out that in some circumstances the purchaser could use "extremely minor" compliance issues to cancel a contract and leave the vendor still liable to pay the real estate agents' commission. He said his firm's concerns "are widely shared in the legal community".

The institute is angered at the response to its new form and emailed all its members stating that it did not lack legal integrity - but admitted that it was reviewing it.