Since as long as I can remember, some banks haven’t always only solely provided banking services. To an extent they have also carried out work offered by other professional fraternities.
We see this for example in that some banks can today draft your will or execute your estate, whereas traditionally it was in most cases conducted by your attorney.
Once upon a time, a trip to the local quick shop was the only way to top-up your airtime or replenish your data. Your bank app can now mostly take care of that.
Of late, a South African bank appears to have established a property portal of sorts with other services and by doing so may be classified as an estate agent?
The portal features on the banks online platform and encompasses tools whereby existing clients of the bank can list and sell immovable property to other clients of the bank.
The platform seems to act as a market place for buyers and sellers of immovable property who are clients of the bank to list property and engage with one another, the objective being the conclusion of a sale. The platform facilitates clients concluding a private sale or selling through an appointed estate agent.
I will briefly examine as to whether in my opinion, by doing so the bank is deemed to be an estate agent as defined in the Estate Agency Affairs Act 1976 (“the Act”) and by virtue of such, required to comply with the Act, as would your neighbourhood estate agent.
When we examine the Act, we see that an estate agent is defined as:
“Any person who for the acquisition of gain on his own account or in partnership, in any manner holds himself out as a person who, or directly or indirectly advertises that he, on the instructions of or on behalf of any other person sells or purchases or publicly exhibits for sale immovable property or any business undertaking or negotiates in connection therewith or canvasses or undertakes or offers to canvass a seller or purchaser therefore…”.
From the above, we see that in order for the bank to be deemed to be an estate agent, the following elements must be present:
- The bank must be acting for the acquisition of gain;
- The bank must directly or indirectly on behalf of their clients sell or exhibit immovable property for sale or negotiate in connection therewith or canvass in respect of the property.
Only the bank can answer if it is acting for the acquisition of gain. Some hypothetical gains may be broader client services, competitor edge, mortgage bond instructions or bank charges to name a few.
Lastly in my opinion, the bank seems to be publicly exhibiting property of another person for sale and canvassing or offering to canvass a purchaser for the property.
In conclusion, it requires further investigation as to whether the bank fulfils the elements included in the definition of an estate agent and is mandated to act only under a Fidelity Fund Certificate issued by the Estate Agency Affairs Board, like your neighbourhood estate agent.
JILLIAN SAN PEDRO works in the Litigation Department at Alan Levy Attorneys Notaries and Conveyancers. Jillian can be contacted on firstname.lastname@example.org or 011 326 8050.