LAND AGENTS’ DUTIES.

Taranaki Daily News, 15 May 1922, Page 5

LAND AGENTS’ DUTIES.

RELATION TO PRINCIPALS. CARE AND GOOD FAITH. The responsibilities of land agents and their duties to their principals were referred to by Mr. J. W. Poynton, S.M., at the Magistrate’s Court at Auckland, in giving judgment in two claims by land agents in connection with the sale and exchange of farms. The relation of principal and agent, said Mr. Poynton, was a confidential one requiring the utmost good faith between the parties, careful inquiries on the part of the agent, and the fullest disclosure of all facts known to him. Land agents, like others, wished to succeed in what they undertook, and there was a risk of their saying too much about the property to an intending purchaser, or about the capacity,‘financial and otherwise, of an intending purchaser to the owner. When property was sold on a small deposit it was of the utmost importance that the purchaser should be experienced and have means to purchase stock and carry on, otherwise the place might be thrown back on the vendor’s hands, involving him in losses and worries, and the purchases in ruin. Many such cases had occurred recently. Even a perfectly innocent misrepresentation as to the financial capacity of an intending purchaser was sufficient to make an agent lose his commission, and in addition, liable to compensate his principal for losses incurred through the transaction.

“On sales or exchanges where only a small proportion of the purchase price is paid,” said Mr. Poynton, “it is of the utmost importance that the purchaser shall be able to complete, and it is an agent’s duty to make careful inquiries into his financial position. It was not sufficient for him to take the statement of the purchaser. Proof is required. If, acting on such statement, the agent represents to his principal that the purchaser is financially sound and it turns out afterwards that he is not, then the agent cannot recover his commission, and further, he is liable to make good any damage suffered -by the vendor through the transaction.”