The Seller (a mortgagee in possession), instructed Agent B to market the Property for sale on a dual agency basis with Agent A, who had been marketing the Property prior to it being repossessed. Following the initial viewing the eventual buyer, Mr E, submitted an offer through Agent B which was accepted. Exchange and completion took place four weeks later. However, after several weeks, Mr E wrote to Agent B to complain, advising that Agent A had given him a copy of a structural report outlining subsidence at the Property with an estimated repair cost of between £25,000 and £30,000 adding that they had informed him that they had provided a copy of that report to Agent B two months previous. Agent B denied that they had received a copy of the report and argued that they were not advised of any structural concerns with the Property by the Seller or any estate agent.
Having examined all of the information presented, there was no documentary evidence indicating that Agent A had advised Agent B of structural issues or that they had provided Agent B with a copy of a structural report. Furthermore, Agent B stated that they had been advised by the Seller at the point of instruction that a survey had been carried out which showed no urgent repairs were required at the Property. However, they were unable to produce any contemporaneous record of that conversation or a copy of the survey itself. In addition, I found that Agent B’s file included feedback from three previous viewers indicating their concern about cracking at the Property along with a record of another previous potential purchaser who was recorded as discovering through his own survey that the Property had ‘structural issues and was not mortgagable’. Based on this feedback, I considered that Agent B was put ‘on notice’ that there may have been structural issues at the Property that required them to take further steps to investigate the matter. I would have expected them to follow up the matter to the extent that if they could not obtain a copy of the prospective buyer’s survey, at the least they should have asked to see the survey the Seller had told them had been previously undertaken, which apparently showed the Property requiring no urgent repairs.
I supported the complaint. However, in considering the level of award I took into account that Mr E had chosen not to instruct a survey prior to purchase, yet he had viewed the Property prior to offering where he would have noticed the same cracking that previous viewers had commented upon. I made an award of £300.
If a seller states that they already have a satisfactory survey and that information forms part of the marketing strategy, the onus is on the agent to ensure that they obtain a copy of that survey to verify the seller’s comments. It is not acceptable to confirm that a property has been surveyed as structurally sound without making the necessary enquiries to verify that position. In this case the failure to make reasonable enquiries, especially in the face of viewing feedback, led to misleading statements being made contrary to Paragraph 5h of the TPO Code of Practice and the CPRs