Real Estate and Business Agents (WA)

In Western Australia, real estate agents and business agents are governed by the Real Estate and Business Agents Act 1978. The Act regulates the behaviour of agents in real estate transactions and provided for the creation of a code of conduct for such agents in 2016.

Code of Conduct

The Real Estate and Business Agents and Sales Representatives Code of Conduct 2016 lists the general and specific duties for those involved in real estate transactions.

General duties

When acting for a client, an agent or sales representative must act in good faith in the best interests of the client. They must exercise due care, diligence and skill, and be honest in all dealings with the client and all others involved in a transaction.

In relation to information, an agent or sale representative must treat as confidential information they know is confidential by its nature or by having been told it is confidential.

An agent or sale representative must act according to the client’s instructions and within a reasonable time. They must not engage in misleading, deceptive or unconscionable conduct, and must not act for more than one client in a transaction unless there is consent from the clients. They must also comply with any obligation that arises as a result of a fiduciary relationship with a client.

Specific duties

An agent or sales representative must not induce a person to breach an appointment to act or any contract to sell or lease property. Written consent must be obtained from a client before the client’s property can be advertised for sale or lease, and the advertisement must not show any price or terms that are not authorised by the client.

An agent or sales representative must make all reasonable efforts to ascertain and verify all facts relevant to a transaction before a contract is signed, as well as inform anyone involved who may not be aware of a relevant fact. When selling a property, they must confirm their client’s identity and their client’s right to sell the property. Any opinion given on the current market price of a property must be accompanied by reasons. Every offer made on a property must be communicated to the client as soon as practicable.

Certification

Any person, partnership or company that wants to operate as a real estate or business agent in WA must be both licensed and hold a current triennial certificate. A person who want to work as a real estate or business sales representative must be registered and be supervised by a licensed real estate or business agent.

Licensing

To apply for a real estate or business agent licence, a person must:

• be an adult;
• be of good character and repute and a fit and proper person to hold a licence;
• have enough assets and money to comply with all requirements of the Act;
• understand fully the duties and obligations imposed on agents by the Act.

To assess whether a person is of good character and repute and a fit and proper person to hold a licence, the Department of Mines, Industry Regulation and Safety requires a police check and two business references.

A licence applicant must have a prescribed qualification, such as Diploma of Property Services or a Bachelor of Commerce majoring in Property, as well as sufficient practical experience in negotiating transactions. An applicant also needs to provide a confidential statement of their assets and liabilities.

Registration

There are three types of registration for a sales representative: unrestricted, restricted to sales transactions, or restricted to property management transactions.

To apply for registration as a real estate or business sales representative, a person must:

• be an adult;
• be of good character and repute and a fit and proper person to hold a certificate or registration;
• understand fully the duties and obligations imposed by the Act on those involved in negotiating real estate transactions and business transactions.

To assess whether a person is of good character and repute and a fit and proper person to hold a certificate or registration, the Department requires a police check and disclosure of any convictions, pending charges, reprimands and fines

An applicant for registration must have completed prescribed modules for the nominated type of registration from the national CPP Property Services Training Package.

Breaches

The State Administrative Tribunal has the power to investigate complaints about an agent or sales representative. If the tribunal finds a breach of the code of conduct, it can take disciplinary action such as issuing a reprimand or caution, imposing a fine, and suspending or cancelling an agent’s licence or registration.

An unlicensed real estate or business agent who claims they are licensed, or implies they are, or operates as if they are, faces a $100,000 penalty. The same penalty applies to a real estate or business agent who allows another person to use their licence or triennial certificate.

An unregistered real estate or business sales representative who claims they are registered, or implies they are, or operates as if they are, faces a $25,000 penalty.

For advice or representation in any legal matter, please contact Armstrong Legal.