Agent fined $35k over house with rot

Lawyer describes case as warning for real estate industry, saying ‘this could be beginning of disturbing trend’

Areal estate agent who sold a Wellington home with rot and “bogged” weatherboards has been ordered to pay $35,000 by the industry’s disciplinary tribunal after the owner lost more than $200,000.

The $35,000 payment included $20,000 worth of general damages — believed to be the largest of its type to come out of the Real Estate Agents Disciplinary Tribunal.

John Waymouth, a lawyer who trains real estate agents on their legal responsibilities, said the case was a warning for the industry.

Ben Cartwright, who worked for Harcourts at the time, was fined in July after pleading guilty to a charge of misconduct over the sale of a house in Karori, Wellington. Cressida Claire Mayson Saywood, according to the tribunal’s decision, bought the Standen St house with her partner in 2015. Cartwright sold it to them.

Saywood later became aware of “significant rot in a window frame” so commissioned a building report which revealed rot, “bogged” weatherboards and obvious defects which needed repair, the tribunal said.

Cartwright, the tribunal said, told Saywood during the sale that an earlier offer did not proceed for financial reasons and failed to say the first tenderers’ contract fell through due to a building inspection report.

The tribunal said Cartwright minimised the report’s content.

Saywood and her partner lost $185,500 when they on-sold the house and, with their costs, were out of pocket $207,731.

They sought reimbursement of the full amount from Cartwright in the tribunal.

The tribunal ordered Cartwright to undergo training, pay Saywood $20,000 for the loss suffered and $10,518.50 for surveyor, building inspector and legal costs. Cartwright was also ordered to pay a $5000 fine.

Waymouth said the biggest part of the fine was $20,000 for general or unspecified damages, which was the largest he knew of for that type of fine.

He is using that case to warn other agents of big financial fines for misconduct, pointing out the tribunal can make orders of up to $100,000.

Waymouth, of Auckland-based Realty Law Consultants, acts for many agents and runs seminars and training courses for national agency chains.

“This is a precedent,” he wrote in a paper for a Christchurch real estate conference a few weeks ago of the $20,000 general damages included in the order. Other agents should beware, he said.

“This could be the beginning of a disturbing trend,” Waymouth wrote. Agents found liable for unsatisfactory conduct or misconduct were being ordered to pay people compensation “which is in effect damages for other non-specific matters”.

Chris Kennedy, Harcourts Group chief executive, said Cartwright had pleaded guilty, was censured and fined but because he was no longer a member of the Harcourts team, he had no further comment to make about it.

Cartwright, who has sold more than $120 million of property during his career, said he had paid the money but would not comment on what he thought of the decision.

Saywood said she and her partner has since returned to Invercargill: “It took three years to get to this end point. I’ve been really disappointed it has flown under the radar. It was really frustrating. My husband went over to the Solomon Islands for a nine-month stint of work to recoup part of the money,” she said.

“It was hell, really,” she said of the emotional, personal and financial costs.

Cartwright now works for Ray White Johnsonville.

Carey Smith, Ray White chief executive, said yesterday Cartwright had worked for Harcourts at the time.