Estate agents' duties, discipline and commission disputes

The SQE tests these duties from a salesperson's desk. The EAQE adds the duties that sit with the business: keeping accounts, putting a licensed manager in every office, not employing unlicensed staff, giving notices, answering for the company's offences as a director, and settling commission disputes through the EAA. Expect scenarios where you must say who is liable, by when something is due, and which sanction or penalty is possible.

Keep two systems apart. Discipline (s.30) is run by the Estate Agents Authority (EAA) and ends in a reprimand, conditions, fine, suspension or revocation. Offences (s.55) are tried in court and can end in a fine and prison. The EAA cannot imprison anyone; a court cannot impose an EAA reprimand.

For Hong Kong residential property, an estate agent who has signed an estate agency agreement must: hold the prescribed information (Form 1 for a sale, Form 2 for a letting), be reasonably satisfied of its accuracy and supply it as the form directs; tell a vendor client of every offer until told otherwise; disclose full particulars of any pecuniary or other beneficial interest in the property and any benefit on its disposal; and, if acting for both sides, tell both and pass information between them on request unless expressly told not to.

• •Salesperson (s.36(3)): carries only the offer, interest and dual-agency duties.
• •s.38 manager handling the property: carries all the duties, as if he were the agent (other than a sole proprietor or partner, who is the agent anyway).
• •Civil liability (s.36(4)): a client who suffers loss has a cause of action, unless the agent shows he took all reasonable steps and exercised all due diligence.
• •Information defence (s.36(5)): relied on a prescribed source (Land Registry, Rating and Valuation Department, Buildings Department), the reliance was reasonable, and all steps reasonably open were taken.