KEY POINTS:
The Real Estate Institute of New Zealand (REINZ) will have no jurisdiction to deal with complaints made after new legislation comes into force but before a new authority is in place, a committee of MPs was told today.
Members of REINZ packed a select committee room today as they argued against aspects of a bill they said would not help the complaints process.
Associate Justice Minister Clayton Cosgrove announced last year the Real Estate Agents Bill to shake up the current in-house regime run by REINZ.
That regime has been criticised for weak penalties, unnecessary delays and a reluctance to refer complaints to its more powerful licensing board.
Under the bill, REINZ will be stripped of its regulatory powers and a new independent Real Estate Agents Authority established that will oversee licensing, complaints and disciplinary action for the nation's 18,000 agents.
The new disciplinary tribunal proposed in the bill will have the power to fine individuals up to $15,000 and companies up to $30,000 for rule breaches.
Real estate agents have previously argued the minister is using a sledgehammer to crack a nut, and the 507 complaints made over a two-year period, which the minister has referred to, needed to be balanced with the fact that during the same period 942,539 homes were sold.
REINZ president Murray Cleland, vice-president Mike Elford, chief executive Christine Le Cren, and constitutional lawyer Mai Chen fronted up before Parliament's justice and electoral committee today.
They argued that while they had no beef with the new authority being set up, there would be a lag between the time the new bill was passed into law and the new disciplinary body set up.
Mr Cleland said that if someone rang up with a complaint the day after the bill was passed, "we can't do anything".
"If an agent rings up about his trust account, we can't audit it as we have been doing to 3000 trust accounts at present. All we can do is refer them to the authority which is unlikely to be established."
Ms Le Cren said all written complaints were investigated.
The committee was also told that some of the complaints about real estate agents that Mr Cosgrove had cited in the past had not been dealt with because he had not made appointments to regional disciplinary committees.
Ms Le Cren said there was "an unfair singling out" of real estate agents.
Ms Chen told the committee that the six months the Government had taken to draft the bill was a very short time for such an industry overhaul.
She also said REINZ had been blocked from meeting with officials while the bill was drafted, and some problems could have been avoided if this had been allowed to happen. Officials had only agreed to meet after the bill was drafted and after REINZ had written to Justice Minister Annette King and the prime minister about it.
REINZ had no problem with the setting up of the new bureaucracy, although the present licensing board "seems to operate pretty effectively and basically needs greater powers to operate and it could do the job quite easily," Mr Cleland said.
He also said there were good consumer protections in the 1976 legislation that either were not in the new bill or had been watered down.
These included the failure of the bill to cover property managers and residential letting and leasing agents, he said.
- NZPA
