West Yorkshire estate agent expelled from The Property Ombudsman Scheme

This means the firm Wara Ltd. trading as Secret Property and Wara, is not registered with a redress scheme, which is a requirement of every sales and letting agent in order to trade legally*. However, Secret Property’s website remains active, though inaccessible without signing up, and Wara’s website still has properties listed for sale.

The case, which led to the agent’s expulsion, was referred to The Property Ombudsman (TPO) when potential buyers of a property on the market with Secret Property were dissatisfied with the agent’s performance.

The buyers wished to reserve a property and paid a £2,000 deposit to the agent in March 2017. They said they were assured by the agent that if for any reason they withdrew, the deposit would be refunded. However, the buyers did not receive any written acknowledgement of the deposit or the terms and conditions attached to the payment. When they subsequently decided not to continue with the purchase and requested for the deposit to be returned, they did not receive a response from the agent, despite sending two letters of complaint via Royal Mail’s tracked and signed for delivery service.

TPO requested Secret Property’s company file and submission letter. Although a submission letter was sent stating that the buyers were willing to sign a reservation agreement, the agent failed to provide a copy of an agreement to evidence their claim.

Katrine Sporle, Property Ombudsman, said: “If an agent facilitates a pre-contract deposit, they have an obligation to take into account specific instructions from sellers. Before a deposit is taken, the circumstances under which the deposit is held, refunded, forfeited or used towards the purchase, should be clearly stated in writing, agreed by and issued to the relevant parties.”

Furthermore, there was no evidence to show that the seller had instructed Secret Property to arrange for a pre-contract deposit to be taken, or any written evidence to conclude that the buyers were made aware of the circumstances to which their deposit would be held. The Ombudsman directed Secret Property to refund the £2,000 deposit and made a further £300 award in compensation for aggravation, distress and inconvenience caused.

The agent has neither responded nor paid the award. The Ombudsman referred the agent to the scheme’s independent Compliance Committee, which ruled the firm should be expelled from TPO and registration for redress.

Gerry Fitzjohn, Non-Executive Director and Chair of TPO’s Finance Committee: “It is important to point out that cases like these are extremely rare and concern the actions of a small minority of agents. Taking into account the vast number of sales and lettings transactions that take place every year, only a small percentage of consumers contact TPO to complain about their agent, and our recent Annual Report reveals an even smaller number are referred to our Compliance Committee.

”Wherever possible, TPO will always facilitate early resolutions between agents and consumers. However, agents that do not co-operate with our investigations, as in this case, put themselves at greater risk of having a complaint upheld, as the Ombudsman only has the consumer’s evidence to consider.”

*N.B. Every sales and lettings agent in England is required to register with a Government-approved redress scheme, which enables consumers to have their complaint reviewed independently in the event of a dispute arising that the consumer is unable to resolve with the agent directly.

An agreement between the two Government-approved redress schemes means Wara Ltd. trading as Secret Property and Wara will not be able to register for any form of redress until the award is paid. Redress registration is required for the agents to trade legally.