Clause 4Other duties of person acting as estate agent

Homes Bill

Public Bill Committees, 18 January 2001, 3:00 pm

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Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

I beg to move Government amendment No. 54, in page 3, line 44, at beginning insert

`with a view to marketing the property,'.

I hope that the amendment will be uncontroversial. A person acting as an estate agent is required under clause 4 to have a seller's pack before he communicates the fact that a property is or may become available to any person in England and Wales. A strict interpretation of the clause might mean that estate agents who mentioned anything to employees, spouses, friends and so on would be committing an offence. Amendment No. 54 would trigger the seller's pack requirements only when the communications are part of a direct attempt to market the property in question. I ask the Committee to support the amendment.

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Mr Geoffrey Clifton-Brown (Cotswold, Conservative)

Before I respond to the Minister, may ask you, Mr. Gale, whether you are minded to have a clause stand part debate?

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Mr Roger Gale (North Thanet, Conservative)

It is difficult for me to determine that, because it depends how wide the discussion on the amendment ranges. The amendment is a narrow one and a narrow debate is likely to arise from it, so if the Committee wants a clause stand part debate, it can have one.

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Mr Geoffrey Clifton-Brown (Cotswold, Conservative)

I am grateful for your guidance, Mr. Gale.

The Conservatives welcome the amendment in so far as it goes. It begins—I emphasise the word—to clear up the confusion that might arise when an estate agent starts to market a property. The Minister provided a narrow definition in referring to when an agent communicates to his employees, spouses, friends and so on. As someone with direct experience of marketing properties, let me tell the Minister what often happens in practice. A person wishing to sell a house will invite one or more agents to discuss the proposition—a process that can take some time because fees, marketing and other matters have to be negotiated. Not until that process is concluded and the client has chosen which agent will market the property will any agent be in a position to proceed. During the phoney marketing phase or pre-marketing phase, an agent will need to discuss that property with other employees and members of his firm. That is only natural, but it is not to say that he would then start a marketing campaign. The Minister must state at exactly what point an estate agent is deemed to be marketing a property.

I want to return to a proposition that I put to the Minister this morning, as I have taken further advice and I believe that what he told me earlier may be wrong. It is about the circumstances in which a property is put on the market by an estate agent. Another agent, having seen the first agent's advertising and marketing says, ``I am retained by a client who is looking for precisely that type of property.'' He tells the other agent, ``I have a client who is interested in purchasing the property,'' or he may approach his client directly. The Minister told me this morning that in those circumstances, the introducing agent would be required to produce a seller's pack.

My advice is that that may not be correct. I should be grateful if the Minister confirmed his previous answer, because one or two experts on the matter believe that he may have been wrong. Depending on what the Minister says, my colleagues and I may or may not try to catch your eye in the stand part debate, Mr. Gale.

3:15 pm
Photo of Mr Chris Mullin

Mr Chris Mullin (Parliamentary Under-Secretary, Department of the Environment, Transport and the Regions; Sunderland South, Labour)

I shall take the hon. Member for Cotswold's second point first. I believe that what I told him this morning is correct, but I shall check it. If I learn anything to the contrary, I will let the hon. Gentleman know.

The hon. Gentleman talked about several agents being invited to tender for business and asked at what point they would be deemed to market a property. Clause 1(6) clarifies the position: marketing occurs when a property is

advertised or otherwise communicated...to the public or to a section of the public.

I shall not detain the Committee further on a matter that we have discussed exhaustively.

Amendment agreed to.

Clause 4, as amended, ordered to stand part of the Bill.