Real estate agency pays $6000 compensation for deceiving buyer

PHOTO: Real Estate Agent. FILE STOCK

An Australian real estate agency has been forced to pay $6000-plus compensation for deceiving a property buyer in its advertising.

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Homeowner Sanjay Tanwar took O’Brien Real Estate to the Victorian Civil and Administrative Tribunal over the purchase of a house in 2020 that was promoted as having air-conditioning but did not.

VCAT Member Ian Lulham ruled in favour of Sanjay at a hearing in January, finding the agency was involved in misleading and deceptive conduct by publishing ads that said the house had “refrigerated cooling”.

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Sanjay was pursuing the cost of installing cooling throughout the property. He was awarded 50 per cent of the quoted cost of a Samsung system, which the tribunal heard was currently valued upwards of $12,000.

VCAT court tribunal ruling — **The Victorian Civil and Administrative Tribunal found in favour of homeowner Sanjay Tanwar. (Nine)**

O’Brien was ordered to pay Sanjay $6,347, deducing that the Samsung system would have cost that much when the house was built in 2015.

It was the second time the dispute had gone to VCAT – on the first occasion, in March last year, O’Brien Real Estate did not show up and the member awarded Sanjay $12,694 to cover the cost of air-conditioning installation. It landed back at the tribunal after O’Brien asked for a review of the decision.

In the published finding in January, the tribunal found Sanjay bought the address from vendor Ismail El Azzouri based on a “representation” made by O’Brien in the ad that it had “ducted heating and refrigerated cooling”.

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Sanjay said this was conveyed to him again by O’Brien agent Lin Zhang on the final inspection and again in an SMS sent to him by the agent, although he intimated he did not turn on the electric control panel which was marked “cool”, “fan” and “heat”. The issue was unable to be resolved in talks around the time of settlement.

Air conditioner air con summer heat cooling tips — **It was argued that the homeowner has failed to see that he house did not have air conditioning was the cause his loss. (Getty Images/iStockphoto)**

“When Mr Tanwar took possession of the property after the settlement, he found that there was no refrigerated cooling, or indeed any cooling, in the house,” the VCAT decision paper said. “Initially, Mr Tanwar assumed that the refrigerated cooling system needed repair, and he engaged Aspen Air to investigate. Aspen Air reported that there was no refrigerated cooling system in the property, but only a ducted heater, which had the heating unit in the ceiling space.”

VCAT emphasised that the claim did not involve the vendor Ismail but the member found his evidence to be “sophistry” and that he also misled Lin.

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“Largely, he sought to deny that he had instructed O’Brien that his house had refrigerated cooling, saying that Mr Zhang had misunderstood the words which Mr El Azzouzi had said and written to him, and that Mr Zhang had failed to exercise his own care and diligence in including the representation about refrigerated cooling in the advertisement,” the tribunal found.

“However, in the course of making these points, Mr El Azzouzi said that anyone looking at the house would have seen that there was no refrigerated cooling unit either on the roof or against any external wall of the house.