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ERA says agent in flipping case done no wrong
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Mdm Tang
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Mdm Tang
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Dear Bro SB , may i know whether a professional property agent can "suka" "suka" call himself by any other names other than his real name as stated in his identity card ( ie nric name ) ?
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Maybe "MICHEAL " next
A property agent can call himself Ong Si Li or Silly Ong, there should not be an issue abt that. The key issue is whether the agent is certified and can be held accountable for. Ceha cert does come with a serial no. and that serial no. should be reflected on the namecard and even in the newspaper ads. When the industry is only 20% certified, we know what we are in for.
Whatever name he wants to call himself, he is still knwon as MIKE THE PARIAH
Im hoping IRAS & CPIB will check on his & his scheming wife's earnings & income received. Im sure also the authorities will uncover some unpaid dues & "overlooked" taxes.
Once a snake will always be a snake. Be it Mike the Snake or Pariah Snake.
Im hoping IRAS & CPIB will check on his & his scheming wife's earnings & income received. Im sure also the authorities will uncover some unpaid dues & "overlooked" taxes.
Once a snake will always be a snake. Be it Mike the Snake or Pariah Snake.
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The Straits Times
February 17, 2009 Tuesday
The murky world of real estate practices
'Secret profit' case sheds some light on the agent-agency relationship
THE world of Singapore real estate can seem all too murky to many, with opaque institutions and questionable deals.
There is no one single authority - either from the industry or the Government - with enough clout to decide who gets to ply the trade and who gets kicked out because of wrongdoing.
The regulatory vacuum means common practices that raise eyebrows are never discussed and analysed with a clear resolution. Questions like 'Should an agent get a commission from both the buyer and seller?', or 'Should an agent be allowed to buy property from his seller?' elicit robust views from both sides.
Earlier this month, we came a bit closer to getting some answers after a couple took housing agency ERA Realty Network to court over the conduct of their agents.
Mr Yuen Chow Hin and Madam Wong Wai Fan, who sold their downtown apartment for $688,000 in 2007, learned subsequently that their home was bought and resold almost immediately by the wife of their agent's boss for $945,000.
They claimed a conflict of interest and sued ERA for $257,000 - the difference between the two sale prices and about $7,300 in commission.
High court judge Choo Han Teck agreed with the couple and ordered that $257,000 be returned to them. ERA has indicated that it may appeal against the ruling.
The case was significant not because a housing agent had been found 'flipping' a property. Professional agents often invest in property themselves, sometimes buying directly from owners they represent. Rather, the case was valuable for the public nature of the disclosures and resolution.
Whether such 'flipping' by housing agents can be considered ethical depends on each transaction. But the line between what is right and wrong has never been drawn clearly because of the freewheeling nature of the industry.
Buyers and sellers who seek a clear resolution are forced to turn to the courts, but many often do not have the stomach, cash or legal muscle to do so. They fight shy of the stress of legal proceedings and settle away from the public eye, leaving other buyers and sellers none the wiser.
The Yuens didn't. This case let the public hear - for the first time in recent years - a large, well-established property firm argue that it is not liable for the actions of its agents because they are considered independent contractors.
The statement may sound surprising to many buyers and sellers who often hire an agent based on a firm's reputation. But the reality is that all agencies - not just ERA - hire agents as independent contractors and take a cut from their commissions. In return, the firms offer agents infrastructure and administrative support.
In the agent-agency relationship, the former has the upper hand because the departure of a star can hit the bottom line.
In the cut-throat world of real estate agencies, losing a top performer could mean also losing hundreds of agents working under him to a rival agency.
It means most property firms are loath to let top performers go, even if they are caught red-handed for unethical practices.
In 2006, for example, veteran ERA agent Syed Abdullah Alhamid was jailed for a month for being part of a scam which helped flat buyers secure loans with fake documents. He returned to ERA not long after being released from jail.
In the Yuens' case, Justice Choo was blunt in rejecting ERA's assertion that it was not liable, given that the transaction documents and advertisements gave the impression that the agents had the backing of the agency.
The fallout from the disclosure of ERA's 'independent contractor' argument is considerable.
It begs these questions: What does it mean when a large, well-established company claims to have a solid reputation, high service standards, and a good track record? How much value can someone place on such assertions, if the 'independent contractor' argument can be pulled out of the hat when things go wrong?
Justice Choo's judgment aside, the case was invaluable for helping to shake the average buyer and seller out of their complacency.
Singaporeans tend to forget that the clear rules and strong institutions they are so used to in their daily lives do not apply in the property industry. The safety nets are so small and legal recourse so fragile that the best bet one probably has is to pick the right agent in the first place.
It doesn't help that rivalry between different factions makes self-regulation near impossible.
The Institute of Estate Agents, formed in 1998 to try to centralise control over agents, has only a small fraction of the more than 20,000 agents in the industry on its membership roll. Since membership is not compulsory, it has no power to keep errant agents out of the industry.
Meanwhile, there is confusion over what it takes to be an accredited agency.
The voluntary Singapore Accredited Estate Agencies scheme, when launched in 2005, required accredited housing agencies to have all their agents pass the Common Exam for House Agents (Ceha) by this year. Last year though, it introduced a scaled-down test, the Common Examination for Salespersons (CES), after feedback that the Ceha was deemed 'too academic'.
This left many agents at a loss over which qualification to try for as it was not clear if Ceha was still necessary for a housing agency to get accredited.
Meanwhile, the Consumers Association of Singapore says it has been in talks with various government agencies to work on yet another accreditation scheme. Whether that - when it takes shape - will be made compulsory remains to be seen.
Until something concrete comes about, laymen will still have to rely on property owners with deep enough pockets to fight court cases for their answers.
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ERA pays flipping profit to couple; agent and his boss quit
By Selina Lum
A COUPLE who successfully sued estate agency ERA Realty Network for flipping their apartment has got back the money that the agents made on it, with interest.
ERA yesterday said that it would not be appealing against the decision last month ordering it to pay $257,000 to Mr Yuen Chow Hin and his wife, Madam Wong Wai Fan.
The couple had sold their two-bedroom downtown apartment for $688,000 through ERA agent Jeremy Ang in 2007, thinking it was the best price he could get them.
They did not know that the buyer of the unit, Madam Natassha Sadiq, was his boss's wife, who immediately resold the apartment for $945,000. Her husband, Mr Mike Parikh, was a senior group division director at ERA.
In a statement responding to queries from The Straits Times, ERA president Jack Chua said yesterday that Mr Parikh and Mr Ang have resigned.
The two men have also agreed to make full restitution for the claims against ERA, he said.
Mr Chua said: 'After reviewing the judgment and the results of its internal findings, ERA concurs with the judgment that both Mike Parikh and Jeremy Ang did not act in good faith in the transaction.'
Mr Parikh is believed to still be in the property business. A Straits Times check found a website, with a photograph of him on it, advertising itself as a 'real estate portal'. It featured several properties he had claimed to have sold, and was updated just yesterday.
He did not return calls to him, however. Mr Ang could not be contacted.
ERA has since implemented new initiatives to improve customer accountability, transparency and governance, Mr Chua added.
Last month, it announced that it now requires agents to sign an undertaking assuring clients that all possible conflicts of interest would be disclosed.
In his judgment, Justice Choo Han Teck had stern words for the unethical behaviour of the two agents. Though Madam Sadiq had made the transactions, her husband was behind them. It was clear, he said, that such practices were not unknown in the industry as the ERA top brass had condoned it.
So that none could claim ignorance, he reminded the industry that an agent had a responsibility to act in the interests of his client, 'not his own, or his friends', or relatives' or his boss''.
Yesterday, Madam Wong said she was very happy with the outcome, as she recalled the journey which had consumed their lives for 11/2 years.
'It was a risk we took, as with any litigation, the outcome is never guaranteed,' said the 48-year-old housewife.
'We believe we were wronged and we were able to get a judgment in our favour.'
The trouble started around October 2007 when she and her 50-year-old husband, a vice-president in an IT company, realised something was amiss when they learnt that their flat had been resold for a much higher price.
As the matter unravelled, she and her husband could not stop turning it over and over in their conversations.
'My children are sick of hearing about the subject,' the mother of two teenage boys said with a laugh.
The day after the judgment came out, her husband was on a plane flying home, and found himself looking at their photo on the front page of The Straits Times. It was 'surreal', he said.
They are recognised at their regular haunts. Some of her friends call her 'the 257 person' and their story is repeated at dinner parties. But testifying in court was 'unnerving' and 'not one of life's greatest feelings', she said soberly.
In the days following the judgment, they received a few phone calls as well as an anonymous package in the mail containing documents from someone who appears to have been in a similar situation.
Madam Wong is aware of the interest in their case. But she declined to comment on the broader issue, except to say that she would be 'less trusting' and 'ask for more information' the next time she sells a property.
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The couple got back the difference in the sales proceeds. ERA probably seek that payment from those 2 agents. Everybody ended up the same as it should have been in the first place.
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Mdm Tang
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The couple got back the difference in the sales proceeds. ERA probably seek that payment from those 2 agents. Everybody ended up the same as it should have been in the first place.
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Mdm Tang
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The couple got back the difference in the sales proceeds. ERA probably seek that payment from those 2 agents. Everybody ended up the same as it should have been in the first place.
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Mdm Tang
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......In a statement responding to queries from The Straits Times, ERA president Jack Chua said yesterday that Mr Parikh and Mr Ang have resigned.
The two men have also agreed to make full restitution for the claims against ERA, he said.
Mr Chua said: 'After reviewing the judgment and the results of its internal findings, ERA concurs with the judgment that both Mike Parikh and Jeremy Ang did not act in good faith in the transaction.' .....
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Mdm Tang
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In a statement responding to queries from The Straits Times, ERA president Jack Chua said yesterday that Mr Parikh and Mr Ang have resigned.
The two men have also agreed to make full restitution for the claims against ERA, he said.
Mr Chua said: 'After reviewing the judgment and the results of its internal findings, ERA concurs with the judgment that both Mike Parikh and Jeremy Ang did not act in good faith in the transaction.'
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Mdm Tang
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more than that. agents can adopt a christian name or any other name so that its easier to remember for potential buyers/sellers. the christian name need not be the official name in the NRIC (pls correct me if I'm wrong on this). for example, your name is Tan Thin Beng. you simply adopt a christian name, say Johnson. so you are now simply known as Johnson Tan. much easier to remember.
part 1.
1 The first plaintiff, a businessman, is the husband of the second plaintiff. They owned a flat in a condominium known as Riverside Piazza at Keng Cheow Street. They decided to sell the flat and by recommendation from the first plaintiff’s mother, sister, and brother, they asked one Ang Teik Soon, known to them as “Jeremy” to help them find a buyer. Jeremy was a “Senior Marketing Director” of the defendant company although the latter asserted in its defence that none of the agents or directors named or involved in this suit were its servant or employee. It claimed that they were independent contractors known as “associates”. I shall return to this point shortly.
2 Jeremy was regarded as an agent of “ERA” (as the defendant is more famously known). The plaintiffs understood ERA to be a company that provided the services of a housing agency; and that a person carried an ERA calling card or who advertised himself as a housing agent under the banner of ERA was an ERA agent.
3 Jeremy had just prior to his engagement by the plaintiffs, found a buyer for a flat owned by the mother of the first plaintiff and was recommended to the plaintiffs as a competent agent. Jeremy worked as a subordinate to one Mitul Ratilal Parikh, known as “Mike”. Mike had at all material times, about 200 agents working under him, all of whom used the defendant’s ERA name and logo. The arrangement in place was that whenever an agent under Mike has successfully helped a client to complete a sale and purchase transaction he would share his commission with Mike and the defendant. There was some discrepancy in the evidence as to what the applicable ratio was, and it seemed that a flexible formula was used. In this respect, the evidence of the defendant’s former Legal Manager Tan Keng Yong’s account differed from that given by Mike. The exact ratio, however, was not important but the fact that the defendant and Mike shared in an agent’s commission was relevant in establishing the nature of the relationship between Jeremy, and Mike, and the defendant. It was a relationship in which the defendant could not be heard to say that it had nothing to do with the conduct of Jeremy or Mike.
4 The first plaintiff was frequently away on business and he therefore left it to the second plaintiff to manage the sale of their Riverside Piazza flat. The second plaintiff was the one who appointed Jeremy as the agent for that purpose in June 2007. Jeremy reported to her sometime in mid-June that the OCBC Bank had valued the flat between $650,000 and $700,000. He told her that he would soon place an advertisement for the sale of the flat. Jeremy telephoned the second plaintiff about 4 July 2007 and told her that he had a Chinese client who wanted to buy the flat for $650,000. According to the second plaintiff, Jeremy described this client as a “regular” client of his. This “client” turned out to be one Natassha Sadiq (”Natassha”), who was (and still is) Mike’s wife. The second plaintiff asked Jeremy why she was not offered the valuation price of $700,000. Jeremy told her in reply that it was because she had recently renewed the tenancy for the flat, implying that a tenancy encumbered flat had a lower value. The second plaintiff then asked Jeremy to make a counter-offer of $688,000. Natassha, who later testified for the defendant, said in her evidence that she had offered to buy the flat at $650,000 after a discussion with her husband, and that they decided on this sum because it was the serial number of her identity card (which was in fact “6500003”). This was not a crucial piece of evidence in itself; it was useful only in my assessment of the witness’s credibility. Jeremy then told the second plaintiff that the seller had accepted her offer. The second plaintiff’s evidence was that she then granted an option dated 12 July 2007 addressed to “Natassha Sadiq or nominee(s)” for her to buy the flat at $688,000, and also signed a commission agreement also dated 12 July 2007 agreeing to pay a commission of $6,880 (1%). The commission agreement was on the defendant’s letterhead, and the addressor was identified in the phrase “Yours sincerely, ERA REALTY NETWORK PTE LTD” and signed by Jeremy in his proper name “Ang Teik Soon”. Between 5 July 2007 and 12 July 2007 there were some negotiation concerning the price and the completion period but this was not relevant to the issues before me.
5 Jeremy claimed that the option and the commission agreement were signed on 5 July 2007 and not on 12 July 2007. I have no hesitation in preferring the second plaintiff’s version. In any event, in my view, it was not a major issue although Jeremy’s point was that the second plaintiff knew as at 5 July 2007 that Natassha was likely to sub-sell the property because of the words “or nominee(s)” appearing in the option form. What was significant was that the defendant filed a claim against the plaintiffs for the commission due from the sale of the flat. That claim was made in the Small Claims Tribunal in the Subordinate Courts by the defendant; not by Jeremy.
6 Natassha exercised her right of option on 26 July 2007, thus contracting to buy the plaintiffs’ flat for $688,000. The plaintiffs did not know at that time that Natassha was Mike’s wife; and they also did not know that Mike was Jeremy’s superior in the defendant organisation. Neither did they know that Jeremy had known Mike for a very long time and was employed by Mike personally when he (Jeremy) was retrenched in 1999 by his previous employer. Mike subsequently suggested that Jeremy join the defendant and that was how Jeremy became an “associate” of the defendant. More importantly, unknown to the plaintiffs, Mike had placed newspaper advertisements for the sale of the flat; and conversely, Jeremy did not place any advertisement. The second plaintiff thought he did because he told her that “no one had responded to the advertisement”. When cross-examined Jeremy told the court that he believed that telling his regular clients (which was in fact Mike, who used his wife as nominee) constituted advertisement. That clever answer did not explain why he had said to the second plaintiff that no one answered the advertisement. Perhaps Jeremy did not think that counsel knew the difference between a tip-off and an advertisement. I think that it is fair to say that most people know the huge difference between those two words. The plaintiffs subsequently discovered that Mike had placed at least two advertisements in the Straits Times; one on 7 July and the other on 14 July. It also transpired that Natassha granted an option to purchase the flat to one Teo Su Kee on 18 July 2007 for the price of $945,000. Teo Su Kee exercised his right of option on 25 July 2007, the day before Natassha exercised her right of option granted by the second plaintiff. Teo Su Kee testified that he bought the flat through Mike in response to a newspaper advertisement.
7 The plaintiffs were puzzled when they received a query from the Central Provident Fund Board (“the Board”) asking them why they had sold their flat below valuation. They asked Jeremy whether that was so. Jeremy told them that it was not true and helped them draft a reply to the Board. The reply was not entirely truthful but that was not a major issue and adds only to the court’s assessment of Jeremy. The plaintiffs received no further communication from the Board after that but they sensed that something was not right. They then searched the newspapers and found the advertisements placed in the Straits Times by Mike. They also discovered through a search made at the Registry of Marriages that Natassha was Mike’s wife. On these facts the plaintiffs sued the defendant for breach of contract and specifically, for the breach of the implied terms that the defendant would use its best endeavours to obtain the best price for the plaintiffs and not act in conflict of interest, or obtain any secret profit.
8 The defendant denied the claim and its counsel, Mr Leonard Loo, made the following two arguments on its behalf. First, he argued that there was no wrongdoing on the part of Mike or Jeremy. Secondly, even if there were any wrongdoing it did not amount to a breach of contract between the defendant and the plaintiffs because neither Mike nor Jeremy was a servant or agent of the defendant. Counsel argued that even though Jeremy (and Mike) had used the defendant’s name, they were independent contractors whose actions did not bind the defendant. It was not disputed that Mike and Jeremy had signed what was titled an “Associate Agreement” with the defendant in which the defendant was known as “the Broker”. Under that agreement, the associate was appointed as the defendant’s agent in terms stipulated as follows:
1 The first plaintiff, a businessman, is the husband of the second plaintiff. They owned a flat in a condominium known as Riverside Piazza at Keng Cheow Street. They decided to sell the flat and by recommendation from the first plaintiff’s mother, sister, and brother, they asked one Ang Teik Soon, known to them as “Jeremy” to help them find a buyer. Jeremy was a “Senior Marketing Director” of the defendant company although the latter asserted in its defence that none of the agents or directors named or involved in this suit were its servant or employee. It claimed that they were independent contractors known as “associates”. I shall return to this point shortly.
2 Jeremy was regarded as an agent of “ERA” (as the defendant is more famously known). The plaintiffs understood ERA to be a company that provided the services of a housing agency; and that a person carried an ERA calling card or who advertised himself as a housing agent under the banner of ERA was an ERA agent.
3 Jeremy had just prior to his engagement by the plaintiffs, found a buyer for a flat owned by the mother of the first plaintiff and was recommended to the plaintiffs as a competent agent. Jeremy worked as a subordinate to one Mitul Ratilal Parikh, known as “Mike”. Mike had at all material times, about 200 agents working under him, all of whom used the defendant’s ERA name and logo. The arrangement in place was that whenever an agent under Mike has successfully helped a client to complete a sale and purchase transaction he would share his commission with Mike and the defendant. There was some discrepancy in the evidence as to what the applicable ratio was, and it seemed that a flexible formula was used. In this respect, the evidence of the defendant’s former Legal Manager Tan Keng Yong’s account differed from that given by Mike. The exact ratio, however, was not important but the fact that the defendant and Mike shared in an agent’s commission was relevant in establishing the nature of the relationship between Jeremy, and Mike, and the defendant. It was a relationship in which the defendant could not be heard to say that it had nothing to do with the conduct of Jeremy or Mike.
4 The first plaintiff was frequently away on business and he therefore left it to the second plaintiff to manage the sale of their Riverside Piazza flat. The second plaintiff was the one who appointed Jeremy as the agent for that purpose in June 2007. Jeremy reported to her sometime in mid-June that the OCBC Bank had valued the flat between $650,000 and $700,000. He told her that he would soon place an advertisement for the sale of the flat. Jeremy telephoned the second plaintiff about 4 July 2007 and told her that he had a Chinese client who wanted to buy the flat for $650,000. According to the second plaintiff, Jeremy described this client as a “regular” client of his. This “client” turned out to be one Natassha Sadiq (”Natassha”), who was (and still is) Mike’s wife. The second plaintiff asked Jeremy why she was not offered the valuation price of $700,000. Jeremy told her in reply that it was because she had recently renewed the tenancy for the flat, implying that a tenancy encumbered flat had a lower value. The second plaintiff then asked Jeremy to make a counter-offer of $688,000. Natassha, who later testified for the defendant, said in her evidence that she had offered to buy the flat at $650,000 after a discussion with her husband, and that they decided on this sum because it was the serial number of her identity card (which was in fact “6500003”). This was not a crucial piece of evidence in itself; it was useful only in my assessment of the witness’s credibility. Jeremy then told the second plaintiff that the seller had accepted her offer. The second plaintiff’s evidence was that she then granted an option dated 12 July 2007 addressed to “Natassha Sadiq or nominee(s)” for her to buy the flat at $688,000, and also signed a commission agreement also dated 12 July 2007 agreeing to pay a commission of $6,880 (1%). The commission agreement was on the defendant’s letterhead, and the addressor was identified in the phrase “Yours sincerely, ERA REALTY NETWORK PTE LTD” and signed by Jeremy in his proper name “Ang Teik Soon”. Between 5 July 2007 and 12 July 2007 there were some negotiation concerning the price and the completion period but this was not relevant to the issues before me.
5 Jeremy claimed that the option and the commission agreement were signed on 5 July 2007 and not on 12 July 2007. I have no hesitation in preferring the second plaintiff’s version. In any event, in my view, it was not a major issue although Jeremy’s point was that the second plaintiff knew as at 5 July 2007 that Natassha was likely to sub-sell the property because of the words “or nominee(s)” appearing in the option form. What was significant was that the defendant filed a claim against the plaintiffs for the commission due from the sale of the flat. That claim was made in the Small Claims Tribunal in the Subordinate Courts by the defendant; not by Jeremy.
6 Natassha exercised her right of option on 26 July 2007, thus contracting to buy the plaintiffs’ flat for $688,000. The plaintiffs did not know at that time that Natassha was Mike’s wife; and they also did not know that Mike was Jeremy’s superior in the defendant organisation. Neither did they know that Jeremy had known Mike for a very long time and was employed by Mike personally when he (Jeremy) was retrenched in 1999 by his previous employer. Mike subsequently suggested that Jeremy join the defendant and that was how Jeremy became an “associate” of the defendant. More importantly, unknown to the plaintiffs, Mike had placed newspaper advertisements for the sale of the flat; and conversely, Jeremy did not place any advertisement. The second plaintiff thought he did because he told her that “no one had responded to the advertisement”. When cross-examined Jeremy told the court that he believed that telling his regular clients (which was in fact Mike, who used his wife as nominee) constituted advertisement. That clever answer did not explain why he had said to the second plaintiff that no one answered the advertisement. Perhaps Jeremy did not think that counsel knew the difference between a tip-off and an advertisement. I think that it is fair to say that most people know the huge difference between those two words. The plaintiffs subsequently discovered that Mike had placed at least two advertisements in the Straits Times; one on 7 July and the other on 14 July. It also transpired that Natassha granted an option to purchase the flat to one Teo Su Kee on 18 July 2007 for the price of $945,000. Teo Su Kee exercised his right of option on 25 July 2007, the day before Natassha exercised her right of option granted by the second plaintiff. Teo Su Kee testified that he bought the flat through Mike in response to a newspaper advertisement.
7 The plaintiffs were puzzled when they received a query from the Central Provident Fund Board (“the Board”) asking them why they had sold their flat below valuation. They asked Jeremy whether that was so. Jeremy told them that it was not true and helped them draft a reply to the Board. The reply was not entirely truthful but that was not a major issue and adds only to the court’s assessment of Jeremy. The plaintiffs received no further communication from the Board after that but they sensed that something was not right. They then searched the newspapers and found the advertisements placed in the Straits Times by Mike. They also discovered through a search made at the Registry of Marriages that Natassha was Mike’s wife. On these facts the plaintiffs sued the defendant for breach of contract and specifically, for the breach of the implied terms that the defendant would use its best endeavours to obtain the best price for the plaintiffs and not act in conflict of interest, or obtain any secret profit.
8 The defendant denied the claim and its counsel, Mr Leonard Loo, made the following two arguments on its behalf. First, he argued that there was no wrongdoing on the part of Mike or Jeremy. Secondly, even if there were any wrongdoing it did not amount to a breach of contract between the defendant and the plaintiffs because neither Mike nor Jeremy was a servant or agent of the defendant. Counsel argued that even though Jeremy (and Mike) had used the defendant’s name, they were independent contractors whose actions did not bind the defendant. It was not disputed that Mike and Jeremy had signed what was titled an “Associate Agreement” with the defendant in which the defendant was known as “the Broker”. Under that agreement, the associate was appointed as the defendant’s agent in terms stipulated as follows:
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