Estate Agency

You will be aware that all residential estate agents must belong to an approved redress scheme.  The OFT have now issued a prohibition order against a Southampton estate agency and the two principles of the firm after the local Trading Standards office had issued a £1,000 penalty charge for failing to register with an approved scheme.  Neither the agency, nor the two principles can now engage in estate agency work.

The Property Ombudsman (TPO) scheme earlier in the year also expelled two agents, one in London the other in Merseyside, because they did not pay awards the TPO had made against them.  In both cases the agencies then paid up and were eventually allowed to re-register.  Recently another agency in Ilford has been expelled from the TPO for not paying a £2,000 award made against it.

In the Ilford case part of the problem was the agency claiming to be a member of NALS and the NAEA when they were not members.  This is clearly a breach of the TPO code of conduct but is also a breach of the Consumer Protection from Unfair Trading Regulations 2008 so there is a risk of a prosecution under these Regulations which would then be a trigger offence for a warning or prohibition order from the OFT.

Clearly the OFT and the redress schemes are flexing their muscles and taking action against agents and agencies that breach regulations.

From October 2009 the ultimate appeal court in the UK, the House of Lords, will be replaced by a new Supreme Court.  This means that when appealing through the court system any appeal from the Court of Appeal from October will go to the Supreme Court rather than the House of Lords

The Supreme Court will only deal with the judicial functions that the House of Lords used to deal with.  The House of Lords will still exist as part of the law making function of the UK (until such time as this is amended or modified by Parliament)

Diagrams of the court system in learning materials should replace ‘House of Lords’ at the pinnacle of the diagram with ‘Supreme Court’

From 31 July 2009 all estate agency practices will need to regsiter with the OFT under the Money Laundering Regulations 2007.  Firms that only undertake lettings or property management work will not have to register.

At the time of writing this, the registration forms are still not available but will be availble on the OFT website from 31 July 2009 and information can be obtained by emailing amld3@oft.gsi.gov.uk

Registration will begin on 31 july 2009 and firms will have six months in which to register.  The registration process will take up to 45 days, so firms are recommended to apply before the end of November.

Regsitration will involve a fee.  The fee levels are £115 per office with a maximum fee of £2,300 where there are multiple offices.  Operators without an office will pay £115.  There will also be an ongoing charge to continue registration payable from 2010, but the amount has not yet been decided.

Firms that continue to trade after 31 January 2010 without registration will be committing an offence.  Prosecution could result in an unlimited fine and/or a prison sentence of up to two years.

Further information will be avialble on the OFT website at www.oft.gov.uk/mlr

David Hughes

July 2009