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No dual-rep and handling certain $

Property agents can only represent one party in the transaction, and must be aware of what monies they can handle.

Representing both parties in the same transaction and handling certain monies related to property transactions - these are common offences that property agents make.

If an agent is handling a HDB flat rental transaction for his landlord client, can he serve the tenant in the same transaction, and get commission from both landlord and tenant? If a tenant asks his agent to pass the rental deposit and monthly rental to the landlord of a HDB flat, can the agent do so?

The answer is “No” for both questions.

A property agent would be committing a dual representation offence if he represents both parties in the same transaction. In other words, an agent cannot represent both buyer and seller, or both tenant and landlord in the same property transaction.

Property agents are also not allowed to handle certain monies related to the buying and selling of properties situated in Singapore, and the lease of HDB properties.

Let’s take a look at a case on dual representation and handling monies related to property transactions.

Former property agent Tan Chai Sern Ryan was recently convicted in Court for representing both the tenant and the landlord in two rental transactions that each involved the lease of a HDB bedroom. He was also convicted of handling money related to one of the rental transactions.

The Court sentenced Tan to a total fine of $12,500, in default 10 weeks’ imprisonment.

Sometime in June 2011, Tan represented a homeowner to advertise the lease of a bedroom in his HDB flat in Ang Mo Kio. He then helped a tenant co-rent the room from the same homeowner at a monthly rental of $300 for a year from July 2011 to June 2012. Later, Tan received a commission of $300 from the owner and $150 from the tenant.

In July 2014, the tenant moved out of the flat. Tan refunded her the commission of $150 after he found out that CEA was investigating him. Nonetheless, Tan was found guilty of dual representation.

Sometime in June 2013, Tan assisted two tenants to rent a room from the same homeowner at a monthly rental of $850 for a year from June 2013 to May 2014. Tan collected commission amounting to half a month’s rent (i.e. $425) from the tenants, and $856, inclusive of Goods and Services Tax from the homeowner. This is again a dual representation offence.

For this transaction, Tan handled $1,700 in rental monies after the tenants passed him their rental deposit and advance rental in cash amounting to $850 each. According to the Estate Agents Act, property agents are not allowed to handle monies in relation to the lease of HDB properties, such as rental deposits and first month rent.

In sentencing Tan, the Court took into account six similar charges that Tan faced for handling monies related to leasing a HDB property.

Learning points

Here’s what Tan should have done to avoid dual representation and handling money related to property transactions:

  • Decline to represent the prospective tenants in the transactions because he is already representing the landlord
  • If the tenants are handling the transaction on their own but wanted Tan to help with the paperwork:
    • Tan should first obtain his client, i.e. the landlord’s, written consent to do so
    • He should be very clear to all parties that he is acting for the landlord
    • He cannot collect a fee for the paperwork and help rendered to the tenant(s)
  • Decline to help the tenants pass rental deposits and advance monthly rental to the landlord
    • Tan should strongly advise the tenants to make payment via cheque or bank transfer directly to the landlord. If the tenants prefer to pay in cash, he should advise his landlord client to issue a receipt

Here’s a recap of the monies in a property transaction that agents can handle.

Read more frequently-asked-questions on dual representation and handling of monies related to property transactions.