LAND AND BUSINESS (SALE AND CONVEYANCING) (BENEFICIAL INTEREST) AMENDMENT BILL

Wednesday 17 May, 2017

Mr TARZIA (Hartley) (16:14): I rise today also to support the Land and Business (Sale and Conveyancing) (Beneficial Interest) Amendment Bill 2017 and indicate that I am the lead speaker for the opposition. The bill was introduced by the Attorney on 29 March this year and amends the Land and Business (Sale and Conveyancing) Act 1994. CBS and Commissioner Soulio claim that there are cases where various complaints have been received, especially, as we have heard, where there are people who have been unfairly taken advantage of in dealing with a real estate agent, a sales representative or an associate.

Mr TARZIA (Hartley) (16:14): I rise today also to support the Land and Business (Sale and Conveyancing) (Beneficial Interest) Amendment Bill 2017 and indicate that I am the lead speaker for the opposition. The bill was introduced by the Attorney on 29 March this year and amends the Land and Business (Sale and Conveyancing) Act 1994. CBS and Commissioner Soulio claim that there are cases where various complaints have been received, especially, as we have heard, where there are people who have been unfairly taken advantage of in dealing with a real estate agent, a sales representative or an associate.

We on this side of the chamber are in favour of a free, transparent and open real estate market, of course. However, as we have seen, there are instances where, because of a few who choose to do the wrong thing and take advantage of the frail and the vulnerable, we need to ensure that certain consumer protection mechanisms are in place. That is what this bill aims to do. Currently, the act makes it an offence to receive a benefit from a land sale; that is, for example, a land agent arranges for his brother or someone to buy a property cheaper than its market value whilst presenting as the representative for the vendor.

The government has put forward claims that some cases have not been prosecuted because the offending party may be outside a strict definition of related person. In addition, the current penalties are not contemporaneous and are inadequate relative to penalties for second-hand car sales. The government considers that the time for prosecution, which is two years from the offending act, is also inadequate and should be extended.

The bill does the following: firstly, it provides for an extension of the definition of those who may be guilty of an offence, particularly extending to persons related to agency employees, associates of a corporate entity, directors of real estate agencies—otherwise known as vicariously liable—and also general managers and managers of individual real estate branches. Also, the definition of associate is extended to include a relative of an employee. I understand that the penalty for obtaining a beneficial interest in selling or obtaining a property, currently a $20,000 fine or imprisonment for one year, will increase to $50,000, which obviously is much more of a deterrent.

Additionally, there will be a new aggravated offence if the victim is over 60, under a guardianship order or suffering a mental incapacity, which at the moment has a fine of $100,000 or imprisonment for two years. It also creates offences for a body corporate, the same as the penalty imposed for the principal offence, unless the director could not exercise due diligence to prevent it. It will also extend the time to prosecute to up to five years from the date of the alleged offence or, with authorisation of the minister, this can be extended to seven years.

The government has conducted much consultation, as have we on this side of the chamber. A government briefing was held on 6 April this year by the commissioner and the Attorney-General's Department. The government has also informed us that it has consulted with REISA and Elders Real Estate, and both are supportive of the government's position. We have had comments made to us by the Australian Institute of Conveyancers, which is generally quite supportive but considers that the potential victim should be over the age of 70 to attract an aggravated penalty. I thought we might talk about that at this point.

I would say that at age 60, on average most people are clearly quite competent. They can still read and write without any issues whatsoever, and so to have an age of 60 under this provision is, I think, a little low. In fact, I would say that when the Attorney is 60 eventually, he will still be sharp as a tack without any doubt whatsoever.

Mr van Holst Pellekaan: Sharper than he is now, anyway.

Mr TARZIA: Much sharper than he is now—exactly. I would not have thought that we should presume that anyone over the age of 60 is incapable of being alert to this kind of exploitation. I think that the age of 60 should be raised to age 70. We consider that the age of 60 for this provision is far too low. The age of 60 still captures quite a significant portion of the market, most of whom would be more than capable of entering into a contract and understanding the kind of relationship that would exist between an agent and a purchaser.

We believe that 70 would be much more appropriate age for the purpose of this section. That, I am informed, is also the position of the Australian Institute of Conveyancers (SA Division). They have also had that view. I understand that the government is also looking to weed out dodgy managers following a flood of complaints to the state's consumer watchdog, Consumer and Business Services. Anything we can do to stop these dodgy operators operating, the better.

We will support the bill; however, we would like to move an amendment to increase the threshold for the aggravated offences of the victim's age from 60 to 70, but we will be supporting the bill with or without amendment. If that amendment is not successful in this house, we hope that the Attorney will give it due consideration between the houses. I commend the bill to the house.