Thursday, January 22, 2009

Couple sue agency after buyer flips flat for profit

WHEN a married couple sold their downtown apartment for $688,000 in 2007, they thought it was the best deal they were going to find.

But soon after they granted the buyer the right to purchase the property, the two-bedroom Keng Cheow Street apartment was re-sold for $945,000.

It was only later that Mr Yuen Chow Hin and Madam Wong Wai Fan found out about the second deal.

They also learnt that the woman who bought their flat - and flipped it for a healthy profit - was married to the boss of their real estate agent.

The couple cried foul, and are now suing ERA Realty Network in the High Court, seeking $257,000 - the difference between the two sale prices - and the return of about $7,300 in commission.

They allege the company did not try its best to find buyers and made a ’secret profit’ off the deal.
ERA disputes that and says the couple have no basis to sue it since the agent was not an employee but an independent contractor.

Yesterday, the hearing entered its third day, with ERA senior vice-president Marcus Chu taking the stand.

He denied that the agency earned any secret profits and said that the real estate agent, Mr Jeremy Ang, did nothing wrong.

Mr Chu said ERA agents are required to disclose the identity of the buyer only if that person is the agent or a member of his immediate family.

This was echoed by Mr Ang, who also took the stand.

Mr Yuen, 50, and Madam Wong, 48, hired Mr Ang to sell their apartment at The Riverside Piazza in June 2007. He told them he would advertise the property.

In early July, an offer came for $650,000. After negotiations, the couple granted the buyer, Madam Natassha Sadiq, an option - dated July 12 - to buy the flat for $688,000.

Meanwhile, Madam Natassha’s husband - Mr Ang’s boss - placed advertisements in the papers to sell the property for his wife.

On July 14, a buyer responded to an ad which asked for $945,106. Four days later, Madam Natassha granted the new buyer an option to buy the flat for $945,000.

Both deals eventually went through.

Mr Yuen and Madam Wong found out about the re-sale only after the Central Provident Fund Board asked them about the disparity between the selling price and the valuation submitted by the new buyer’s banker.

Their lawyer, Ms Gan Kam Yuin, argued that ERA made little effort to get the best possible price for the flat.

She questioned why Mr Ang did not place newspaper ads for the couple. Mr Ang said calling up his regular clients, who included Madam Natassha, constituted ‘advertising’.

Ms Gan argued that the firm had placed itself in a position of conflict of interest.

But Mr Ang said there was no conflict because the buyer was not himself nor his wife.

Madam Natassha and her husband, Mr Mike Parikh from ERA, are expected to testify today.

Source: Straits Times - 22 Jan 2009

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