Real estate firms ordered to pay millions for price fixing

Spread the love

Two Hamilton real estate firms have been ordered to pay $4 million between them after they colluded with other firms in agreeing to charge vendors the costs of advertising their properties on Trade Me.

no  caption

File photo. Photo: 123RF

A cartel is where two or more businesses agree not to compete with one another, and is an offence under the Commerce Act.

Lodge Real Estate Limited and Monarch Real Estate Limited’s judgement brought an end to a five-year legal battle instigated by the Commerce Commission to prosecute 13 real estate agencies for the crime.

The case went all the way to the Supreme Court.

Commission chair Anna Rawlings said the substantial monetary penalty should serve as a warning to businesses.

“It is not unusual for industries to experience price increases from suppliers and this case illustrates how important it is that companies avoid any discussions with their competitors on how they could or should respond to such a change.

READ ALSO:  Covid-19 update: There is one new imported case in MIQ but none in the population.

“Cartels can harm consumers and business, by raising prices, restricting supply and changing the competitive dynamic between businesses.”

All up, the various companies and associated individuals have been fined $23m.

From April next year, such an act could also see the directors of the offending companies serve jail time.

The case began in 2015 after it was discovered 13 national and regional real estate agencies, a company owned by a number of national real estate agencies, and three individuals had agreed on a response to Trade Me’s 2013 price hikes for real estate listings.

In November 2017, the High Court dismissed the Commission’s claims against Lodge and Monarch and their directors saying there was an arrangement or understanding between the respondents, but that it did not have the purpose or effect of fixing, controlling, or maintaining the price for Trade Me listings services.

That judgement was successfully appealed by the Commission a year later and the two firms then sought the final say from the Supreme Court.

READ ALSO:  Residents near dump fire on alert after council's dioxin notice

The Supreme Court upheld the Court of Appeal’s decision.

The other companies involved are the Hamilton real estate agencies Online Realty Limited (trading under the Ray White banner) and Lugton’s Limited, Property Brokers Limited and its director Tim Mordaunt, the head offices of Barfoot & Thompson, Harcourts, LJ Hooker and Ray White, Manawatu 1994 Limited (trading under the LJ Hooker banner), Bayleys Corporation Limited and Hamilton-based Success Realty Limited and Unique Realty Limited.

Join Geezgo for free. Use Geezgo\’s end-to-end encrypted Chat with your Closenets (friends, relatives, colleague etc) in personalized ways.>>

 370 

Leave a Reply