The agent was found guilty of not returning a $20,000 deposit.
Prestige & Rich Pty Ltd of Sunnybank Hills near Brisbane, trading as Stephanie To Realty, was fined $5,000 last Tueday by the Holland ParK Magistrates Court.
Stephanie To is the sole director and licensee of the agency. The claim was that she retained a $20,000 commission even though the sales contract never settled.
The action against the agency was brought by the QLD Office of Fair Trading (OFT). They alleged that Ms To did not return a deposit as required by the Agents Financial Administration Act 2014 (AFAA).
A buyer entered into a contract to buy a piece of property, but the contract was terminated because the buyer could not come up with the finances to complete the transaction.
The buyer then requested that Stephanie To Realty return the deposit of $24,500. The vendor also agreed that the deposit should be returned to the buyer.
However, in contravention of the AFAA, the agency did not release the funds to the buyer. Instead, it released $4,500 to the seller, and kept $20,000 as commission.
The OFT slapped the agency with an infringement notice, but Ms To decided to take the matter to court instead.
The court, however, was not sympathetic. It found the agency guilty of failing to pay a disputed amount from a trust account. A conviction was recorded.
The Magistrate, Robert Turra, said the defendant ignored "advice and direction" intended to benefit the agency, and "stubbornly" insisted its own version of the law was correct.
On the same day, the Queensland Civil and Administrative Tribunal (QCAT) decided to award a $24,500 payment to the buyer from the AFAA claim fund, in spite of a review requested by the Stephanie To agency.
QCAT confirmed that OFT's awarding of the payment to the buyer from the claim fund, as compensation for the misappropriation, was appropriate.
The money will be recovered from the agency to repay the fund.
Brian Bauer, executive director of OFT, said real estate agents deal with large sums of money and must act with integrity to maintain community trust.
"Agents not dealing with consumers’ money in accordance with the law will be held accountable by the OFT.
"The purchase and sale of properties are the biggest transactions in most people’s lives, and Queenslanders need to know agents will follow the rules."
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