An estate agent arranged for her client to sign a provisional agreement of sale and purchase for a property before the client had obtained the Certificate of Eligibility, which would facilitate his purchase of the flat. The Disciplinary Committee ruled that the agent had not sufficiently safeguarded client interest and ordered that restrictions be attached to her licence.

Early this year, the complainant applied to the Housing Society for a loan under the Home Starter Loan Scheme and then engaged an estate agent to search for a property for him. The agent soon showed him a property in which he became interested after viewing.

At that point in time, the complainant had not yet obtained the Certificate of Eligibility from the Housing Society. According to the stipulations of the Home Starter Loan Scheme, an applicant must not be in direct or indirect possession of any form of property in Hong Kong within the 120 months prior to the submission of application, and during the time between the submission of application and the grant of the Certificate of Eligibility. For the purpose of this restriction, the signing of the provisional agreement for sale and purchase is interpreted as coming into possession of a property. On this the complainant queried the agent as to whether the signing of the agreement would affect his loan under the Home Starter Loan Scheme, and the agent said that his eligibility for the loan would not be affected if no date were to be entered in the provisional agreement. The complainant then signed the undated provisional agreement, made out a cheque for the deposit, and passed the cheque to the agent for stake holding, with the instruction that the money be released to the vendor upon the Certificate of Eligibility successfully obtained.

A little more than a month later the complainant was informed by the Housing Society that his application was refused because he was found to be in possession of property in Hong Kong.

The estate agent explained to the Disciplinary Committee that she had arranged for the complainant to sign the provisional agreement in order that the vendor and the purchaser might prove to each other their commitment to the transaction. She claimed that since the agreement was not dated and with many details left out, it could only be interpreted as a letter of intent and not a provisional agreement for sale and purchase.

Having heard all relevant submissions, the Disciplinary Committee held that the estate agent in question, by arranging for her client to sign a contract which was left blank in many places, had committed an act of undesirable practice and infringed upon the principle of protecting and advancing client interest. The Committee, observing that she did not understand that the contract was in effect a provisional agreement for sale and purchase, had doubt about her professional capabilities as an estate agent. The Committee therefore ordered that conditions be added to her licence, to the effect that she be debarred for one month from all transactions related to the various loan schemes of the Housing Authority and the Housing Society and any property subject to the Housing Ordinance. The agent was also encouraged to study the relevant legislations so as to enhance her professional knowledge and standard of service.