A licensee receives an offer on a property but learns of a higher offer from another buyer before presenting the first offer to the vendor. What should the licensee do according to professional standards?
Correct Answer
A) Present both written offers to the vendor promptly
Rule 10.10 of the Client Care Rules requires a licensee to submit to the client all offers that are in writing, and rule 9.3 requires timely communication. Both offers go to the vendor, who decides; the Rules do not require offers to be presented in the order received.
Why This Is the Correct Answer
Rule 10.10 of the Client Care Rules requires a licensee to submit to the client all written offers, and rule 9.3 requires timely communication. Both offers go to the vendor; the Rules do not require them to be presented in the order received.
Why the Other Options Are Wrong
Option B: Present only the higher offer, to maximise the return to the vendor
Rule 10.10 requires every written offer to be submitted; the licensee cannot decide that the vendor should see only one.
Option C: Negotiate between the two buyers to push the price as high as possible
Running a contest between buyers without instructions takes the decision away from the vendor and is not what rule 10.10 requires.
Option D: Present the higher offer, and mention the lower one only if asked
Holding back the lower offer unless asked breaches rule 10.10 and the duty to keep the client informed.
Deep Analysis of This Professional Conduct Question
The vendor, not the licensee, decides which offer to accept. Rule 10.10 therefore requires every written offer to be submitted, rule 9.1 requires the licensee to act in the vendor's best interests, and rule 9.3 requires the client to be kept informed in a timely way. Choosing which offers the vendor sees, or holding one back, takes that decision away from the vendor. Multi-offer processes have their own REA guidance, but the core duty is simply that all written offers are put forward.
Background Knowledge for Professional Conduct
Client Care Rules 2012: rule 10.10 (seller's agent must submit all written offers to the client), rule 10.11 (salesperson gives the agent a copy of every written offer submitted), rule 10.12 (agent keeps copies of every written offer for 12 months), rule 9.3 (timely communication).
Memory Technique
Think of the licensee as a courier, not a gatekeeper: every written offer goes to the vendor, and the vendor chooses.
Reject any option where the licensee filters, delays or ranks offers instead of submitting them all.
Exam Tip for Professional Conduct
Rule 10.10 is about submitting all written offers. It says nothing about order received, so do not be drawn by 'chronological' wording.
Real World Application in Professional Conduct
A salesperson receives a written offer of $800,000 at 2 pm and another of $850,000 at 2.30 pm, before contacting the vendor. The salesperson presents both to the vendor that afternoon, keeps copies for the agency, and lets the vendor decide how to respond.
Common Mistakes to Avoid on Professional Conduct Questions
- •Withholding a lower offer to 'help' the vendor
- •Thinking offers must be presented in the order received
- •Negotiating between buyers without the vendor's instructions
Related Topics & Key Terms
Key Terms:
More Professional Conduct Questions
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During a complaint investigation, what is a licensee's obligation regarding cooperation with the Real Estate Authority?
A licensee discovers that a competing agent has made false statements about a property they have listed. What is the most appropriate course of action?
A licensee is charged with misconduct for serious breaches of the Code. During the disciplinary hearing, they argue that their actions were directed by their branch manager. How will this affect the Tribunal's decision?
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- → An agent receives two written offers on the same property at the same time: one from the agent's personal friend at $50,000 below the asking price, and one from an unknown buyer at the asking price. The agent presents only the friend's offer. Under the Real Estate Agents Act 2008, this most likely amounts to:
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