Sunday , 9 February 2014
Headlines
- Official Speech of Governor Babatunde Fashola at the launch of Lagos H.O.M.S
- 3INVEST to launch a Mortgage Clinic at PBF in partnership with 2014 Social Media Week
- Lagos State Govt Rolls out Home Ownership Mortgage Scheme
- ECOWAS Leaders Approve $50m for Trans-West African Highway
- CBN bars NMRC from Real Estate Construction Financing
- Real Estate: 3 Things to Note Before you Sign a JV Agreement and 3 Sucessful Real Estate JVs
- 2014 Editor’s Pick: 7 Events That Can Change Your Real Estate Business
RULES AND REGULATORY CODE OF CONDUCT THAT GUIDE AND PROTECT THE PRACTICE OF ESTATE AGENCY IN LAGOS STATE
RULES AND REGULATIONS OF REAL ESTATE TRANSACTIONS
A Registered Agent transacting business in Lagos State shall have ascertained business premises or office within the State.
A Registered Agent shall maintain a record of his or her business transactions and shall open a separate client account for that purpose.
A Registered Agent shall ensure that a prospective tenant or purchaser takes physical possession of the property paid for within fourteen (14) days.
A Registered Agent shall ensure that his principal performs all his obligations due to government under applicable legislation and regulations.
STANDARDS OF PROFESSIONAL COMPETENCE
A Registered Agent must exercise skill, care, competence, and diligence at all times when carrying out agency work.
A Registered Agent is presumed to be conversant with laws and regulations relevant to the agency work.
STANDARDS OF PROFESSIONAL CONDUCT
A Registered Agent must comply with the fiduciary obligations to his or her client arising as a Registered Agent.
A Registered Agent must act in good faith and deal fairly with all parties engaged in a transaction.
A Registered Agent must not engage in any conduct likely to bring the industry into disrepute.
A Registered Agent must not mislead a customer or client, nor provide false information, nor withhold information that should by law or in fairness be provided to a principal.
A Registered Agent is required to discover hidden or underlying defects in property and must disclose known defects to the principal. Furthermore, where it appears likely, on the basis of the Agent’s knowledge and experience of the real estate market, that a property may be subject to hidden or underlying defects, the Agent must either
(i) Obtain confirmation from the principal that the property in question is not subject to defect; or
(ii) Ensure that his principal is informed of any significant potential risk so the principal can seek expert advice if he so chooses.
A Registered Agent must not continue to act for a principal who directs that information referred to in rule 3.v be withheld.
DUTY TO REPORT MISCONDUCT OR UNSATISFACTORY CONDUCT
A Registered Agent who has reasonable grounds to suspect that another Agent is guilty of unsatisfactory conduct may make a report to the office.
For example, houses built within a particular period of time, and of particular materials, are or may be at risk of weather tightness. A Registered Agent could reasonably be expected to know of this risk (whether or not a seller directly discloses any weather tightness problems). While a customer is expected to inquire into risks regarding a property and to undertake the necessary inspections and seek advice, the Agent must not simply rely on caveat emptor.
This example is provided by way of guide only and does not limit the range of issues to be taken into account under rule 3.iv .
A Registered Agent must not be use, or threaten to use, the complaints or disciplinary process for an improper purpose.
DUTIES AND OBLIGATIONS OF AGENTS TO CREATE AWARENESS OF LAW, REGULATIONS AND RULES
A Registered Agent who is operating as a business entity must display these rules prominently in the public area of each office of branch, and provide access to it on every website maintained by the agent for the purposes of the business.
A Registered Agent must make these rules available to any person on request.
A Registered Agent who is operating as a business must ensure that Agents engaged or employed are familiar with the applicable law and other legislation relevant to real estate agency work, associated regulations, and any rules made by the office, including these rules.
CLIENT CARE AND DEALINGS WITH CUSTOMERS GENERAL
A Registered Agent must act in the best interest of his principal and act in accordance with the principal’s instructions unless doing so would be contrary to law.
A Registered Agent must not engage in any conduct that would put a principal or prospective principal under undue or unfair pressure.
A Registered Agent must not take advantage of a principal’s or prospective principal’s inability to understand relevant documents, where such inability is reasonable apparent.
A Registered Agent must communicate regularly and in a timely manner and keep the principal well informed of matters relevant to the principal’s interest.
An appraisal of land or a business must be provided in writing to a principal by a Registered Agent; must realistically reflect current market conditions; and must be supported by comparable information on sales of properties in similar locations or businesses.
An Advertised price must clearly reflect the pricing expectations agreed with the principal.
A Registered Agent must not mislead customers as to the price expectations of the principal.
AGENCY AGREEMENTS AND CONTRACTUAL DOCUMENTS
When inviting signature of an agency agreement a Registered Agent must explain to a prospective principal in writing-
The conditions under which commission must be paid and how commission, is calculated, including an estimated cost (actual Naira amount) of commission payable by the principal, based on the appraised price of the property or business.
How the property or business will be marketed and advertised, including any additional expenses that such advertising and marketing will incur;
That he or she is not obliged to such additional expenses; and
That further information on agency agreements and contractual documents is available from the office and how to access this information.
When inviting signature of an agency agreement or sale and purchase agreement, or other contractual document, a Registered Agent must ensure that a prospective principal is aware that he or she can, and may need to seek legal, technical, or other advice and information, and allow the prospective principal a reasonable opportunity to do so.
A Registered Agent must not submit an agency agreement or a sale and purchase agreement or other contractual document to any person for signature unless all material particulars have been inserted into or attached to the document.
A Registered Agent must not invite a prospective principal to sign a sole agency agreement without informing him or her that if he or she enters into or has already entered into other agency agreements, he or she could be liable to pay full commission to more than one Agent in the event that a transaction is concluded.
A Registered Agent must not impose conditions on a principal through an agency agreement that are not reasonably necessary to protect the interest of the Agent.
A Registered Agent must submit to the principal all offers concerning the sale, purchase, or other disposal of any property or business, provided that such offers are in writing.
A Registered Agent must retain copies of all offers (whether such offers resulted in transaction or not) for a period of 12 months.
ADVERTISING AND MARKETING
Unless authorised by a principal, through an agency agreement, a Registered Agent must not offer or market any property or business, including putting details on any website or by placing a sign on the property.
A Registered Agent must not advertise any property or business on terms that are different from those authorised by the principal.
When authorised by a principal to incur expenses, a Registered Agent must seek to obtain the best value for the principal.
A Registered Agent must take due care to ensure the security of the property or business and avoid risks of damage that may arise from any access to the property or business.
CONFLICTS OF INTEREST
A Registered Agent must not act in capacity that would attract a commission from parties on more than one side of the same transaction.
A Registered Agent must not engage in business or professional activity other than the agency works where the business or activity could reasonably be expected to; compromise the discharge of the Registered Agent’s obligations.
CONFIDENTIALITY
A Registered Agent must not disclose confidential personal information relating to a principal, unless-
The principal consents in writing; or
The Registered Agent is required by law to disclose the information; or
The disclosure is necessary to answer or defend any complaint, claim, allegation, or
proceedings against the Agent by the principal.
Where a Registered Agent discloses information under i. (b) or (c), it may be only to the
appropriate person or entity and only the extent necessary for the permitted purpose.
A Registered Agent must not use information that is confidential to a principal, for the
benefit of any other person.
LICENSED ESTATE AGENT CODE OF CONDUCT
(iv) Licensed Estate Agent shall be familiar with the content of the most current forms commonly used in real estate transaction
(iv) In a competiting offer situation, a Licensed Estate Agent acting as a dual agent shall not use the information contained in another offer to put either client at a competitive advantage
(v) Licensed Estate Agent shall render proper accounts of all his client money and property entrusted in his care
(vi) A Licensed Estate Agent shall supply professional expertise needed to ensure successful completion of any contract enter between buyer and seller
(vii) A Licensed Estate Agent who is representing more than one buyer on the same property must disclose the fact to each buyer
(viii) A Licensed Estate Agent shall be fair in discharging his duty and obligation in line with the client’s lawful instruction
(i) accepting compensation from more than one party to a transaction, or
(ii) accepting any discount or profit on expenditures made for a client
(b) disclose to their clients any financial or other benefits the Licensed Estate Agent or his/her firm may receive as a result of recommending real estate products/services to that party
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