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APC - Spring 2025 > Purchase and Sale - Estate Agency Legislation > Flashcards

Purchase and Sale - Estate Agency Legislation Flashcards

(55 cards)

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1
Q

When was the RICS Global Real Estate Agency and Brokerage Professional Statement Published

A

2016

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2
Q

How many core principles does RICS Global Real Estate Agency and Brokerage Professional Statement (2016) have

A

12 which agents must observe

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3
Q

Core principles of RICS Global Real Estate Agency and Brokerage Professional Statement (2016)

A
  1. Act in an honest, fair and professional manner
  2. Carry our work with due skill, care and diligence
  3. Terms of business that are fair and clear (+CHP)
  4. Avoid conflicts of interest
  5. Not to discriminate
  6. All communications to be clear and timely
  7. Marketing material to be honest and truthful
  8. Clients’ money to be held in separate accounts + insured
  9. Hold appropriate PII
  10. Make clear your obligations to your client / each party
  11. Realistic assessments of prices / rents (MARKET EVIDENCE)
  12. All meetings, inspections and viewings to be carried out with clients wishes and safety
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4
Q

Estate Agents Act published

A

1979

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5
Q

Estate Agents Act 1979 Applications

A
  1. Disposal/acquisition of interest in land
  2. Freehold property
  3. Leasehold property with a capital value
  4. Land as well as buildings
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6
Q

Estate Agents Act 1979 - how many key principles

A

7

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7
Q

Estate Agents Act 1979 - key principles

A
  1. Clarity to terms of agency (S18)
  2. Honesty + Accuracy
  3. Agreement + liability for costs
  4. Openness re personal interests (S21)
  5. Absence of discrimination
  6. Legal obligation - tell clients of all offers
  7. Keep clients money separate
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8
Q

Estate Agents Act 1979 - MOST important points

A
  • Section 18 – Terms of engagement, specify all costs/fees
  • Itemise all payments.
  • Specify nature of agency/ selling rights
  • Additional services available
  • Section 21 – disclosure of personal interests (IN TOE)
  • Correct reporting of offers
  • Follow RICS Rules - client money
  • Offer reporting procedure
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9
Q

Who polices the Estate Agents Act 1979

A

Local authorities
+
The National Trading Standards Estate and Letting Agency Team

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10
Q

Negative Licensing

A

The right to be an estate agent can be taken away and not granted

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11
Q

Penalties when in breach of Estate Agents Act 1979

A
  1. Prohibition Order
  2. Warning Order

(awarded against individual or practice)
c10-12 orders a year

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12
Q

What is the outcome of a Prohibition Order

A

Stops an agent practicing

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13
Q

What is a Warning Order

A

Written warning not to undertake the action again

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14
Q

What is the Estate Agents (Undesirable Practices) (No 2) Order 1991

A

Order made under the Estate Agents Act 1979

Agents must inform clients at the same time as they are informed about their terms of business as to any services to be offered to prospective purchasers unless free of charge

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15
Q

Estate Agents (Provision of Information) Regulations 1991

A

Information supplied to a client in writing:
1. Service provided
2. Remuneration

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16
Q

What is a cooling off period

A

A period of up to 14 days is allowed for client who change their minds and no longer want to instruct the agent in accordance with consumer protection regulation

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17
Q

Consumer Protection Regulations publication date

A

2008

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18
Q

What did the Consumer Protection Regulations and Business Protection Regulations replace

A

The Property Misdescriptions Act 1991 - repealed in Oct 2013

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19
Q

Which Act do Business Protection Regulations sit within

A

Enterprise Act 2002

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20
Q

Consumer Protection from Unfair Trading Regulations 2008 relate to what kind of work

A

Business to Consumer work

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21
Q

Consumer Protection from Unfair Trading Regulations 2008 WHAT DOES IT OFFER, WHEN DOES IT APPLY

A

Broad non- specific consumer protection for estate agents – applies during entire agency process

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22
Q

How does the Consumer Protection from Unfair Trading Regulations 2008 define the average consumer

A

As a reasonably well informed person

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23
Q

Example of unfair practice under the Consumer Protection from Unfair Trading Regulations 2008

Study These Flashcards
A

Giving false or misleading information, omissions, exerting undue pressure on consumers

24
Q

Who comes under the definition of consumer, and therefore have a duty to under the Consumer Protection from Unfair Trading Regulations 2008

Study These Flashcards
A

Clients
Potential clients
Potential buyers
Potential viewers
Actual buyers

25
Who is the Consumer Protection from Unfair Trading Regulations 2008 policed by
Trading Standards Office of the Local Authority
26
The two sets of regulation that apply to estate agency
1. Consumer Protection Regulations 2. Business Protection Regulations
27
What doe CPRs prohibit
Unfair business to consumer commercial practices
28
Maximum penalty for breach of CPR + BPR
Unlimited fine and prohibition order Compensation of up to £25,000 to complainant
29
Consumer Protection from Unfair Trading Regulations 2008 key facts
1. Regs apply to all lettings/sales 2. Agent duty of care to all consumers 3. Declare all known information - ensure full diligence 4. Dont exert undue pressure on potential buyer 5. OMISSIONS -> LEAD TO BREACH 6. Client VALIDATION of information 7. DISCLAIMERS dont apply to this criminal offence
30
What do Business Protection from the Misleading Marketing Regulations, 2008 relate to
Business to business activities and mirror principles of CPR
31
What do Business Protection from the Misleading Marketing Regulations, 2008 prohibit
Misleading business to business advertising, impose restrictions on how business compare their product's to products from other companies
32
Caveat Emptor meaning
Let the buyer beware; meaning that the buyer should satisfy itself on all matters relating to the property - overriding common law principle
33
Consumer Rights Act publication
2015
34
What does the Consumer Rights Act 2015 amend
Existing consumer protection law and gives consumers new rights and remedies
35
What does the Consumer Rights Act 2015 consolidate
Law relating to unfair terms and contracts between businesses and consumers
36
Penalty for breaches of the Consumer Rights Act 2015
£5k per breach, policed by Local Authority
37
CBRE Disclaimer (Misrepresentation Act)
1. All information is given in good faith and subject to change 2. Don’t rely on statements as fact 3. Purchasers must investigate and satisfy themselves information is correct 4. Areas and measurements are approximate
38
When was the Misrepresentation Act published
1967
39
What does the Misrepresentation Act 1967 relate to/ cover
A misrepresentation or a false statement of fact made by a party during pre-contractual enquires, which has the effect of inducing the party to purchase
40
What type of offence is a breach of the Misrepresentation Act 1967
Civil, actionable as tort - a wrong at common law and a form of negligence
41
Under xxx Act the agent has a duty of care to check that the advice, information of opinion is reliable
Misrepresentation Act 1967
42
What may be be effective in protecting the vendor and their agent (if fair and reasonable)
Exclusion/ disclaimer clauses
43
What is the leading case under the Misrepresentation Act 1967 which refers to test of reasonableness
Hedley Byrne & Co Ltd v Heller & Partners 1964
44
What are the three tests to decide agent's liability for negligent statements
1. Foreseeability; damage = reasonably foreseeable? 2. Proximity - relationship sufficiently proximate? 3. Fairness - reasonable/just for such a duty of care to arise
45
What does Misrepresentation Act 1967 apply to
Professional opinions and third party advice
46
What has the house of lords Industry and Regulations Committee published?
Report on regulation of property agents call on government to take forwards the recommendations of Lord Bests report in 2019
47
What does section 18 of the Estate Agents Act 1979 refer to
Terms of buiness
48
What does section 21 of the Estates Agent Act 1979 refer to
Declaration of personal interest
49
Which kind of occupier's cannot register for VAT
Financial intuitions, charities and medical practitioners
50
Transfer of going concern purchases
Are not treated as a supply of goods or services for VAT purposes. This can reduce liability for VAT e.g. in the sale of a property let to a tenant. If the property is registered for VAT, and the rent is subject to VAT, it may be possible not to charge VAT on the sale.
51
Capital allowances
Form of tax relief upon capital expenditure for the construction or purchase of commercial property or business assets - can generate substantial tax savings.
52
Capital allowances relevant legislation
The Finance Act 2019 - enhanced capital allowances
53
Land Registration Act 2002
Provides a framework for electronic property conveyancing, by allowing formal documents to be executed electronically (achieved by 2030)
54
Requirements of the Land Registration Act 2002
All FHs and new leases granted for 7+ years, existing leases sold or assigned with 7 years left to run must be registered with the Land Registry with a compliant lease plan
55
Under the Land Registration Act 2002 all freehold transactions need a complaint plan with the what details?
1. Drawn to a metric scale 2. Have a scale measurement bar 3. Have the scale noted on the plan 4. Include a 1:250 scale location map 5. Full address including post cost 6. A north point 7. Demise in red outlined on the inside edge of the property

APC - Spring 2025 (11 decks)

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