A man accused of deliberately falsifying a LIM report when selling his own home by deleting reference to major moisture defects is now a top Auckland real estate agent.
The man has been charged with knowingly using an altered document to defraud and could be jailed for up to 10 years if convicted of the crime.
Police say the altered LIM report was uploaded to the listing agency’s website and relied upon by the buyers, who paid nearly $1.2 million for the North Shore home in 2015.
They only learned it might be leaky when they went to sell it several years later and requested their own LIM from Auckland Council.
It’s understood the new report included the missing reference to weather tightness problems and they were forced to sell the property for less than expected.
It’s estimated they suffered financial damage of up to $335,000 as a result of the alleged deception.
The agent, who is still listed as having an active licence to sell property – was jointly charged last year with his wife with knowingly using an altered document with intent to defraud.
The alleged offending occurred before he became a real estate agent, coincidentally with the same firm he used to sell his house.
The couple deny the charges.
The Herald has been fighting to name the man, arguing the public who have entrusted him to sell their biggest asset have a right to know he is facing a serious police charge linked to the falsification of property documents.
But a court has ruled he and his wife can keep their names secret until their trial next year, after they claimed significant health problems meant publicity could cause a relapse of cancer or potentially fatal heart attack.
The man also argued his job could be at risk if he was publicly identified and the charges were “not particularly serious”.
“The alleged offending … has some hallmarks of a civil matter given that the complainants clearly did not undertake a proper due diligence when purchasing the property,” the man’s lawyer Ian Brookie told the court.
The man told the Herald the case was a “storm in a tea cup”.
“You’re wasting all your time on this. It’s quite ridiculous.”
He claimed the complainants were “hell bent on making life difficult for us” and had sold their house for “very near” what they paid.
The case was “very complex and not as simple as you might think”.
Police documents obtained by the Herald say the nation’s leaky home crisis is well documented as causing victims substantial financial losses, both in resulting purchase price and loss in capital gain.
Victims often faced “ruinous financial stress” after learning their major asset was affected by weather tightness problems and worth far less than they thought.
A police summary of facts alleges the couple listed their house with a leading real estate company in 2015 and obtained a LIM report from Auckland Council.
It contained a clause stating that a letter had been received by the council from the previous owner’s solicitor “informing of major moisture-related cladding defects”, the summary of facts alleges.
Four days later, the man’s wife allegedly sent an electronic copy of the LIM to a real estate agent contracted to market their home, the summary says. The LIM was subsequently uploaded to the agency’s website for prospective buyers to view.
“In this copy of the LIM, the aforementioned [moisture] comment … was removed with a blank space now existing where the comment was on the original document.”
Two days after viewing the property, the victims learned the auction had been brought forward, according to the summary. It left them with less than two days to either commit to the purchase or withdraw from tendering an offer.
“With no reasonable ability to access the LIM directly from the council due to the reduced timeframe, [the victims] obtained a copy of the LIM via [the agency’s] website and then forwarded it to their legal representative as part of their due diligence,” the summary alleges.
“Believing that the LIM was full and correct, [the victims] purchased the property … for $1,190,000 – a decision they would not have made had they sighted the original LIM document.”
In 2019 the victims decided to the sell the property and listed it with the same agency.
The summary of facts alleges a LIM report was ordered from the council and upon inspection the clause highlighting moisture-related cladding defects was discovered.
The victims then sold the property “as is” for $1.165m – $25,000 less than they’d paid four years earlier.
A valuation estimated the house would have been worth between $1.3m and $1.5m if there were no issues with the LIM – meaning the victims suffered financial loss of between $135,000 and $335,000, according to the summary.
Police were alerted and charges laid in May last year.
The defendants told police they had no knowledge of the weather tightness clause in the LIM being removed and have pleaded not guilty.
During a suppression hearing this week at Auckland District Court, Crown prosecutor Pavee Patanasiri said the defendants were “alleged to have altered property documents to sell a property for significant profit”.
There was public interest in the defendants being identified given the housing crisis and concerns about leaky homes, and the fact one of the accused “subsequently became a real estate agent”.
A judge granted interim suppression on the basis of medical evidence provided to the court.
“I’m very conscious of the need for the public to know what’s going on in its courts, but I’m satisfied that the test of extreme hardship has been reached.”
The Real Estate Authority would not comment on the case while it was before the courts.
Source: Read Full Article