Do we have a case against the Estate Agent for mis-selling the house?

Yorkie1

There are 2 distinct issues being confused here:

1. Criminal offence under the PMA 1991.

White Horse, I'm not sure what you mean by "strict liability, so that's it". Are you implying that once the false statement is made, there must automatically be guilt?

Strict liability means that there does not have to be mens rea - i.e. as soon as the elements of the act of the offence are proved, there is a criminal guilt. There is no requirement to prove intention, recklessness, negligence or any blameworthiness. As a point of general construction of the PDA, I disagree with the extracted document's interpretation on this point slightly, because the PDA specifically provides for a defence of due diligence - which is essentially that the EA wasn't negligent or blameworthy in the circumstances of the case.

Trading Standards is the enforcement body for any criminal prosecution. It appears that OP couldn't bring a private prosecution for an offence; their power is limited to reporting the EA to TS - and given the low number of prosecutions in this area nationally, the evidential threshold for disproving the due diligence defence must be pretty high.

2. Civil action for loss, which is what the OP is asking about. I am not familiar with the civil law side of this, but I suspect that a civil action might fail, owing to s.1(4):

"No contract shall be void or unenforceable, and no right of action in civil proceedings in respect of any loss shall arise, by reason only of the commission of an offence under this section."

Happy to be contradicted by case law though re civil loss.

roger196

Your friend is S.2 of the Fraud Act 2006. Whether you can persuade the police to act against an 85 year old man is another matter.
Consider the enthusiasm EA's use the moneylaundering regulations to extract purchaser's details and financial position, they should have a similar obligation to ensure that the vendor actually owns the property. A simple check at the land registry at a sum of £4 would go a long way to disclose problems.
Check the small claims court website for whether recovering money lost to fraud is within their remit.

DVardysShadow

Of course. if people had not been so ready to obey the press and whinge about HIPs and ultimately get rid of them, the relevant information would have been in the HIP and OP would still have their £900.

jamie11

When our offer was presented to the company, they said they wouldn’t accept it, and wanted £10K (ten thousand) more than our offer.

Is that £10K to release their equity? If so then surely the old man would have to pay that out of the sale price.

googler

roger196 wrote: »

Your friend is S.2 of the Fraud Act 2006. Whether you can persuade the police to act against an 85 year old man is another matter.

Surely that only applies to a deliberate attempt to defraud, rather than an 85-year old releasing equity from his home and not realising or being made fully aware of the implications?

DVardysShadow

jamie11 wrote: »

Is that £10K to release their equity? If so then surely the old man would have to pay that out of the sale price.

It looks like the 10K is the shortfall of the sale price against the loan.

WhiteHorse

Yorkie1 wrote: »

There are 2 distinct issues being confused here: 1. Criminal offence under the PMA 1991. 2. Civil action for loss, which is what the OP is asking about.

Point.

White Horse, I'm not sure what you mean by "strict liability, so that's it". Are you implying that once the false statement is made, there must automatically be guilt? Strict liability means that there does not have to be mens rea - i.e. as soon as the elements of the act of the offence are proved, there is a criminal guilt. There is no requirement to prove intention, recklessness, negligence or any blameworthiness.

True.

From the Act itself:

Offence of property misdescription.
s1.1 Where a false or misleading statement about a prescribed matter is made in the course of an estate agency business or a property development business, otherwise than in providing conveyancing services, the person by whom the business is carried on shall be guilty of an offence under this section.

There is no mention of intent or recklessness. Admittedly, there is no mention of strict liability either.

As a point of general construction of the PDA, I disagree with the extracted document's interpretation on this point slightly, because the PDA specifically provides for a defence of due diligence - which is essentially that the EA wasn't negligent or blameworthy in the circumstances of the case.

Agreed, it does seem slightly odd - make it an offence of strict liability, and then provide a defence!

I suspect that the intention when framing the Act was firstly, to discourage bent, reckless or incompetent EA's and secondly, to also recognise the difficulty that EA's face when trying to verify what sellers tell them.

Trading Standards is the enforcement body for any criminal prosecution. It appears that OP couldn't bring a private prosecution for an offence; their power is limited to reporting the EA to TS ...

Yes, so it seems at first glance. But anyone should be able to lay an Information, so I wonder what the court would do if you did.

... and given the low number of prosecutions in this area nationally, the evidential threshold for disproving the due diligence defence must be pretty high.

To be honest, I suspect it has more to do with the fact that Trading Standards simply don't want to know.

Civil action for loss, which is what the OP is asking about. I am not familiar with the civil law side of this, but I suspect that a civil action might fail, owing to s.1(4): "No contract shall be void or unenforceable, and no right of action in civil proceedings in respect of any loss shall arise, by reason only of the commission of an offence under this section."

The purchase contract may be dead, but the OP has suffered a significant loss for which someone is obviously blameworthy.

I would say they have a civil remedy if the EA can be shown to have not exercised due diligence (ie negligence, failure to discharge duty of care). Given the false statement, they may have a case against the vendor, although as other posters have pointed out, equity release probably means that it will not be worth the effort.

Hoof_Hearted

A small point -- just because somebody is 85 doesn't mean they are confused.

Trollfever

Spambump.....