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Lack of information on file

"If a vendor withdraws from a sale and the agent remarkets the property, the agent should, of course, advise the potential buyer – in writing!” says Katrine Sporle, The Property Ombudsman.

Katrine Sporle

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THE COMPLAINT

In her complaint, the potential buyer said that she was in the process of purchasing a property and signed the contract in readiness to exchange. However, three months later she was informed by her solicitor that the agent had remarketed the property and subsequently agreed a sale with another buyer.

Katrine Sporle image

Katrine Sporle

The Complainant said that she did not withdraw from the sale as was claimed and that, when she contacted the agent to seek clarification on the issue, she was informed that it was not standard practice to provide written confirmation of a party withdrawing from a sale. The agent stated that they were unable to contact the Complainant or her solicitor for six weeks and therefore considered that she had withdrawn from the transaction.

THE AGENT’S RESPONSE

In response, the agent said they could not comment on the conversation the Complainant had with their staff member regarding their standard procedure if a party withdraws from a sale. However, the agent did confirm that they would expect it to be confirmed in writing if a sale did not go ahead.

The agent said that, due to a lack of information within their file, they were unable to establish the events that occurred, other than that their notes stated the Complainant withdrew her offer, so the property was remarketed accordingly. The agent apologised for any incorrect information provided to her by their staff and acknowledged that it did not appear that the Complainant had been informed that the property was remarketed, of another party’s interest or that the sale to her was not proceeding.

TPO FINDINGS

Under Paragraph 1i of the TPO Code of Practice, the agent was required to keep clear and full written records of all transactions and produce them when required by TPO’s Office. It was clear from written evidence and the agent’s submission that they did not keep clear and full written records of the attempted transaction, hindering the Ombudsman’s ability to thoroughly review the specific complaints made.

Due to a lack of information in the agent’s file, they were unable to establish the events that occurred.

The agent’s file notes showed that an offer was made and a Memorandum of Sale issued. The next event documented by the agent was four months later, where the property status changed from ‘Sold Subject to Contract’ to ‘For Sale’. There was no subsequent explanation or confirmation within the file to allow the Ombudsman to conclude what communication had or had not occurred with any party and why the agent had taken this action.

Under Paragraph 12a of the Code, the agent was required to monitor the progress of the sale. Therefore, the Ombudsman would have expected to see four months of notes indicating that the agent was in regular contact with the legal representatives to request updates. However, no notes were documented.

In accordance with Paragraph 1e of the Code (best practice), the agent should have confirmed in writing to the Complainant, the Seller and their solicitors that the sale was not proceeding. The agent confirmed within their submission letter that this is part of their procedure. The Ombudsman was of the view that had the agent contacted the Complainant to confirm their understanding that her offer had been withdrawn, the Complainant would have been able to dispute some months prior to when she actually found out the sale was no longer proceeding to her. Instead, she remained under the impression that the conveyancing process was still progressing.

OUTCOME

The agent made a goodwill offer of £400, but the Ombudsman did not consider that level of compensation appropriate to reflect the aggravation caused by all of their shortcomings and inactions.

The complaint was supported to the extent that:

  • The agent did not make any attempt to monitor the sale and make suitable file notes to show that they acted in accordance with their obligations
  • they did not write to all parties involved to confirm that the sale was no longer proceeding and that the property was to be remarketed
  • the issue was not brought to light in a timely manner which caused the Complainant undue aggravation, distress and inconvenience.

The Ombudsman noted that the agent’s shortcomings left the Complainant totally unaware of the status of her intended purchase, for which an award of £750 was merited.

September 7, 2018

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