- Prohibition Against Undue Influence
No Property Practitioner shall, without good and sufficient cause, directly or indirectly, in any manner whatsoever, solicit, encourage, persuade, or influence any party or potential party to a pending or completed transaction to utilise or refrain from utilising:
Code:
7.1 the services of any particular attorney, conveyancer, or firm of attorneys;
Discussion
The only person who is legally obliged and competent to pass transfer is the seller of immovable property. Agreements of sale of immovable property for this reason invariably provide that transfer will be effected by the conveyancer appointed by the seller. A Property Practitioner may not, therefore, pressurise a seller into selecting a particular attorney, conveyancer, or firm of attorneys, merely because the Property Practitioner has a good relationship with them. Property Practitioners are sometimes of the view that certain conveyancers are able to expedite transfers more efficiently than others. This personal view does not justify a seller being influenced to utilise or refrain from utilising the services of any particular attorney or conveyancer.
It may happen that a seller does not have or know a conveyancer. If asked for a recommendation, the Property Practitioner may in such case suggest a particular conveyancer. The selection of a conveyancer by a Property Practitioner acting on the specific instruction of a seller does not contravene this prohibition, provided that the seller understands that they have the right to make the selection themselves.
Code:
7.2 the services of financial assistance offered by any financial institution to members of the public in general; or
Discussion
The purpose of this clause is to avoid a situation where a Property Practitioner promotes a particular financial institution with a view to furthering their own personal interests. Competition between financial institutions to grant home loans is fierce, and a Property Practitioner cannot, for personal reasons, favour one institution over another.
However, nothing prevents a Property Practitioner from furnishing a purchaser with details of the loan packages offered by various financial institutions. For example, it is permissible for a Property Practitioner to advise a purchaser that their agency firm acts as an agent for a specific financial institution, and to explain to such a purchaser the institution’s loan policy. In doing so, the Property Practitioner must, however, be careful not to convey to the purchaser that such an institution’s services are better or more professional than those of other similar institutions, or that the lending policy of other institutions is suspect. The test is simply whether the Property Practitioner is trying to force the purchaser into a certain direction or is providing genuine information to assist them in deciding which institution to approach for a loan.
Code:
7.3 the financial assistance offered to such a party by any person.
Discussion:
What has been said in respect of clause 7.2 is also applicable to clause 7.3.