Wilkinson Kate: Real Estate Agents Bill — Second Reading In Committee Third Reading 
Wilkinson Kate: Real Estate Agents Bill — Second Reading In Committee Third Reading 
[Volume:649;Page:18410] 
KATE WILKINSON (National) 
: 
 I rise to speak to Part 3 of the Real Estate Agents Bill and following on from my colleague Mr Finlayson I do urge the Committee to consider the proposals submitted by Mr Dunne with those very sensible and consumer protection-related amendments. I do urge the Chamber with some scepticism because when one has the Government of the day voting against a provision that says the authority must consult with the industry training organisation for the real estate industry one has to wonder whether they are trying to create and legislate good law or whether it is still just that political posturing. This is a so-called listening Government but it does not listen to common sense. These amendments suggested by Mr Dunne as he rightly said are hardly subversive they are hardly radical and they actually do improve the consumer protection of this bill. 
Like my colleague Mr Finlayson I want to touch on a few clauses in Part 3. The first one is the entitlement to the licence which is in clause 34. It states that “An individual may be licensed as an agent or a branch manager if … the individual (a) has attained the age of 18 years; and (b) is not prohibited from holding a licence … ; and (c) is a fit and proper person to hold a licence; and (d) has the prescribed qualifications; and (e) has obtained 2 years’ experience in real estate agency work within the 10 years preceding the application to be licensed … ” . 
I am aware that the Minister has an amendment in Supplementary Order Paper 243 that will increase that experience to 3 years in the 10 years preceding the application. Mr Dunne’s amendment will tighten that and add more protection for the consumer by specifying the experience as 3 years’ experience in real estate agency work within the 5 years preceding the application. That is much better for the consumer and if this Government really were a listening Government then it would certainly vote in favour of the amendment proposed by Mr Dunne. 
It was raised during the select committee process whether 18 years of age was actually old enough for a person to be buying and selling on behalf of another person his or her most valuable asset—a home. Often it is the most important significant purchase that any family in New Zealand makes and I wonder whether a person who is 18 years of age is sufficiently old or sufficiently experienced to do that. I think that when we talk about ages there are so many different age limits littered throughout our legislation but when one has the very same Minister who on the one hand says that a person of 18 years of age is not old enough to buy a beer—because he voted against that in the sale of liquor legislation—but that an 18-year-old is old enough to buy and sell someone’s most prized possession a house then one has to wonder about the consistency of that Minister’s judgment. 
The other clause I really want to mention in relation to Part 3 is clause 48. Clause 48(1) states: “A salesperson must in carrying out any agency work be properly supervised and managed by an agent or a branch manager.” It then specifies: “In this section properly supervised and managed means that the agency work is carried out under such direction and control of either a branch manager or an agent as is sufficient to ensure—(a) that the work is performed competently; and (b) that the work complies with the requirements of this Act.” 
On first reading that might seem quite sensible but if one goes back to the original Real Estate Agents Act section 54(2) contains the phrase “effective control”. The wording of that is: “Every branch office of a real estate agent … shall be under the effective control of a person approved by the Board”. So we have changed the terminology from “effective control” to “properly supervised and managed”. The difficulty with changing phraseology and terminology in legislation is that one has to build up a whole new supply of cases to actually explain and verify what that means. Considerable case law already exists as to what “effective control” is. We have now changed that to “properly supervised and managed” and my concern is that this will lead to uncertainty and now a new load of case law which will try to interpret Parliament’s intentions. It will also try to distinguish the difference between “effective control” and “properly supervised and managed” and will try to work out what the intention of Parliament was in relation to this new definition. 
We have to ask ourselves whether this actually adds anything to the consumer protection nature or element of this legislation that could not have been satisfied by using the tried and true terminology of “effective control”. I would like the Minister to take a call on that because I think that is very important and that we have a duty as legislators not to be reckless when we are making law and to me it is certainly not contentious but it is going towards better law-making. I would like the Minister to give us his views of that change in terminology. 
The other clause that I will briefly mention is clause 50 which has been deleted by the Minister’s Supplementary Order Paper 243. National will certainly be voting in favour of that one. It concerns the 5-yearly review of the employment status of salespersons. Having that 5-yearly review hanging over the heads of salespersons was just too untenable and uncertain and really did not add much to the debate. There is no reason whatsoever why salespeople cannot make the choice to be employed on an employment basis or on an independent contract basis—a contract of service as opposed to a contract for service—and accordingly that review has now been deleted from the bill by virtue of the Minister’s Supplementary Order Paper and we certainly approve of that. 
Another concern however in relation to the employment status of salespersons is whether changing the terminology to “properly supervised and managed” as opposed to “effective control” implies changes to the employment status of salespersons so that they may in fact be deemed to be employed rather than self-employed. I am concerned that there might be a plethora of cases that would try to interpret the difference in that terminology and that will lead to uncertainty within the real estate industry as to whether these salespeople are employed or are indeed self-employed. I think it is important that the Minister does address this issue because I think that is the responsible thing for him to do. It is one of the important clauses in Part 3 that we have highlighted and I really would appreciate the Minister taking a call. No calls for the Minister to answer any questions have so far been taken seriously whether in relation to the definition of “transaction” the definition of “residential property” or the definition of “real estate agency work”. Now I am asking the Minister to take a call to explain the definition of “properly supervised and managed”. I would appreciate the Minister’s advice or his getting advice from officials as to the ramifications of that change of definition.