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http://www.straitstimes.com/Breaking...ry_334920.html
Really scarely to think that ERA's top brass admit the Industry also did the same thing.
Obviously they never study agency law.
One general rule. Never trust the agent completely. Must do your own homework. If that's the case, how much commission should seller pay the commission? :beats-me-man:
http://www.straitstimes.com/Prime%2B...ry_334751.html
February 6, 2009 Friday
ERA told to return $257,000 to couple
Judge slams unethical agents who 'flip' properties for profit
By Selina Lum
A HIGH Court judge yesterday criticised the unethical behaviour of two ERA Realty Network agents and ordered the return of $257,000 to a couple who used the agency to sell their apartment.
Mr Yuen Chow Hin, an IT company vice-president, and his wife, Madam Wong Wai Fan, a housewife, had let go of their two-bedroom downtown flat at $688,000. They took their ERA agent's word that this was the best price they could get.
What they did not know was that the buyer of their Riverside Piazza unit was the wife of their agent's boss, and that she re-sold it almost immediately for $945,000, making a hefty profit.
Yesterday, Justice Choo Han Teck ruled in favour of the Yuens, who had sued ERA for the 'secret profit' made in the second deal.
Justice Choo found that the conduct of agent Jeremy Ang and his boss, Mr Mike Parikh, senior group division director at ERA, amounted to breach of duty and fraud.
He also had a stern reminder for the industry of its ethical responsibilities, as it had emerged in court that such practices were common.
The judge concluded that it was Mr Parikh who wanted to buy the flat in order to make a quick profit during the property boom.
To distance himself from the deal, he used his wife, Madam Natassha Sadiq, as the buyer and Mr Ang as the seller's agent, the judge found.
Mr Ang was the link but Mr Parikh was the person behind the scheme, and his position made his subordinate's breach of contract even more reprehensible.
The misconduct was of such magnitude that the judge said he felt bound to make the reasons clear in his judgment so that no property agent could now claim ignorance.
When a property agent is engaged to sell or buy property, he has a responsibility to act in the interests of the person who appointed him - not his own, or his friends', or his relatives' or his boss', said the judge.
'This responsibility that the agent bears is the foundation of the ethical rules and contractual principles that prohibit an agent from acting in conflict of interests and reaping secret profits for himself or his friends.'
Madam Sadiq was a party to the plan carried out by her husband and Mr Ang.
'The result of the concerted efforts of Jeremy, Mike and Natassha resulted in the plaintiffs selling their flat for less than what they might have had they been properly and honestly advised,' said the judge.
Justice Choo rejected the testimony of ERA's top brass - president Jack Chua and senior vice-president Marcus Chu - that the two men had done nothing wrong.
The judge said it was clear why they thought so - Mr Chu admitted in court that he and others in the company, as well as agents in other companies, had done the same thing.
Justice Choo also rejected arguments by ERA that it was not liable for the actions of its agents, who are 'independent contractors'.
The option form had ERA's logo printed on it; the commission agreement was between Madam Wong and ERA; and the newspaper advertisements sought to persuade the public that they would have the backing of the company and its network by engaging an ERA agent.
It was also ERA - not Mr Ang - which took the couple to the Small Claims Tribunal when they refused to pay the commission on the sale.
Yesterday, a relieved Madam Wong said: 'Naturally, I'm very happy. I respect the decision of the court.'
In a statement, ERA president Jack Chua said: 'ERA intends to appeal the court decision that finds our company liable as we did not benefit from the transaction.'
Mr Jeff Foo, president of the Institute of Estate Agents, would only say the case could have been prevented if real estate agencies and their agents are licensed.
He said: 'In this way, the industry will be regulated and everybody can be held responsible and accountable for their actions.'
The institute has a code of conduct and ethics for members.
Mr Ang is not a member of IEA.
[email protected]
Additional reporting by Diana Othman
Give ERA agent a miss if U want to SELL. They will sell to their BOSS wife or relative.Quote:
Originally Posted by vin002
Engage any agent with IEA license the rest are fake.
Quote:
Originally Posted by PropertiesHunter
Actually, ERA agent not only give themselves the bad name but the real estate Industry. Yes, IEA license may be real, but lawyers/accountant/doctors are also real. As long as they are human, there is a possibility of greed over ethics.
Therefore, always protect youself regardtheless who you deal with. This is a case being exposed but I guess there are many unexposed cases.
http://www.straitstimes.com/News/Hom...ry_335657.html
Feb 8, 2009
THE SELLERS
They thought they had good deal
By Debbie Yong
Her name was Natassha Sadiq.
They thought that sounded like she was from the Middle East, which meant she had to be rich and could afford to pay top dollar for their property.
And so the Yuens told their property agent: Okay, done deal.
But six months after Mr Yuen Chow Hin, 50, and his wife Wong Wai Fan, 48, sold their Riverside Piazza apartment to Madam Sadiq for $688,000, they discovered their error.
Madam Sadiq was actually the wife of the boss of their property agent.
And even before she had inked the deal to buy their unit, she had already resold it for $945,000.
That turn of events eventually led to a High Court case that ended last Thursday with the judge ordering property agency ERA Realty Network to pay the Yuens the $257,000 difference.
The saga began in June 2007.
Less than a fortnight after the Yuens engaged ERA property agent Jeremy Ang to sell their Riverside Piazza apartment near Clarke Quay, they were told that a buyer had been found.
Mr Ang said a regular client of his was offering $650,000 for the two-bedroom unit, which is just below 1,000 sq ft.
He added that OCBC Bank had valued the flat at between $650,000 and $700,000.
When the couple asked why they were not offered $700,000, Mr Ang said it was because they had recently renewed a two-year lease with their tenant Yuji Kubo, a 57-year-old Japanese trader. The couple charged him $2,000 in monthly rent.
Madam Wong told The Sunday Times yesterday that she took Mr Ang's word about the price, and did not check with other property agents if this was an industry norm.
'We had no reason to be suspicious. Our main thought was that agents will try to get the best price for us because it means they get a higher commission too,' she said.
Of the potential buyer, she noted: 'Jeremy said Madam Sadiq had bought many properties from him before and, judging by her last name, we got the impression that she was a rich Middle Eastern woman who regularly invests in property. We assumed we were getting a fair price.'
The housewife and her husband, a vice-president in an information technology firm, live with their two teenage sons in a terrace house in Serangoon Gardens.
The couple had bought the Riverside Piazza property in 1995 as an investment - the first time they had done so - paying about $609,000.
They decided to sell it to help pay for a new condominium unit in Serangoon, jointly owned by Mr Yuen and his sister, for Mr Yuen's aged parents to live in, said Madam Wong.
'I had told Jeremy to liaise directly with Mr Kubo about scheduling visits from potential buyers. Once, Mr Kubo complained to me that Jeremy had turned up at the flat without notifying him first, so I assumed Jeremy was doing his job,' she added.
She said they did not set any price and had asked Mr Ang to obtain a bank valuation.
The Yuens offered to sell the flat to Madam Sadiq for $688,000 on July 12. The latter said 'yes' on July 26. The couple did not meet Madam Sadiq in person.
'For most lay people, once the price is agreed upon, you hand it over to the lawyers, banks and the CPF Board. It's a process that you don't think about because it's too complex,' said Madam Wong.
In October 2007, the Yuens received a call from the Central Provident Fund Board about the discrepancy between the value of the flat - based on a valuation done by the new owner's bank - and the amount they had sold it for. That was when they sensed that something was amiss.
After getting their lawyers to check on the caveat lodged on the property, they tracked down the new owner, engineer Teo Su Kee, 48, at his Toa Payoh home.
They discovered that the transaction was handled by ERA agent Mike Parikh, who had put up newspaper advertisements - dated July 7, 9 and 14 - for their unit.
They also found that Mr Teo exercised his option to buy the flat from Madam Sadiq on July 25 - a day before she agreed to buy it from the Yuens.
Suspecting an internal arrangement among the parties, the Yuens checked with the Registry of Marriages and found out that Madam Sadiq was married to Mr Parikh.
It was a 'surprise', said Madam Wong. Mr Parikh had handled the sale of her brother-in-law's HDB flat in Pasir Ris in 2006.
Mr Parikh had also recommended Mr Ang, his subordinate, to handle the sale of her mother-in-law's HDB flat in Hougang in early 2007.
The smooth transactions led the Yuens to entrust Mr Ang to sell their property as well.
They wrote to ERA about their findings and refused to pay Mr Ang's commission of $7,361.
'We tried to arrange a discussion with their directors. We only wanted some accountability and answers,' said Madam Wong.
ERA wrote back to say that the two agents had done nothing wrong. In January last year, it made a claim against the couple at the Small Claims Tribunal for failing to pay the commission.
It was this that prompted the Yuens to file the lawsuit against the company.
Now that the judgment has been passed, Madam Wong said she feels some relief as the saga had caused her sleepless nights.
But with ERA saying last Thursday that it intends to appeal against the court's decision, she acknowledged that 'it's not over yet'.
'We don't know what the next step will be, but we will try to put it aside for now and get on with our Chinese New Year celebrations,' she said, adding that she has not made any plans for the money yet.
'I will be more careful the next time and definitely not be so trusting,' she added.
[email protected]
http://www.straitstimes.com/News/Hom...ry_335659.html
Feb 8, 2009
CURRENT OWNER
Buyer dragged into legal tussle
All Mr Teo Su Kee wanted was to buy an apartment in the Clarke Quay area to invest in. He got more than he bargained for.
The engineer was dragged into a lawsuit between the previous owners of his two-bedroom apartment and property giant ERA Realty Network, over the latter's unethical behaviour.
Mr Teo, 48, who works in a multinational company, was called to appear in court to give his account of how he bought the flat.
'I am just an innocent buyer, I do not wish to be involved in this. I am very frustrated,' he said of having to take time off work to testify.
In July 2007, Mr Teo responded to an advertisement put up by ERA senior group division director Mike Parikh for the sale of a Riverside Piazza apartment.
He told The Sunday Times yesterday that he checked out the apartment with Mr Parikh and another man, whom he could not remember.
Mr Teo had been eyeing several apartments in River Place and Riverwalk that were going for more than $1,000 per sq ft (psf). When Mr Parikh offered him $998 psf for the flat, he accepted readily.
'It was a good deal as I had been surveying the prices of several properties in this area, and it was within the market value,' he said.
He learnt about seller Madam Wong Wai Fan's plight only when she visited him at his Toa Payoh home.
'I was surprised that she sold the apartment at a price that was way below the market rate,' he said.
There was another twist to the tale - Mr Teo found out from his wife that Madam Wong used to be her boss in a recruitment agency.
With the court case over, he wants to put the experience behind him.
He intends to sell the flat, but not immediately after his tenant, Mr Yuji Kubo, moves out. He also does not know the price he might get.
A resident at Riverside Piazza, who got a valuation from a bank, told The Sunday Times yesterday that the unit is likely to fetch only about $860,000 now.
Huang Huifen
THE TENANT
'All I know is that there has been a change of ownership, but I'm still paying the same rent, thus it is nothing related to me.'
MR YUJI KUBO, 57, tenant of the Riverside Piazza apartment, on the legal tussle between the unit's previous owners and ERA