20180827 How can you inflate the price?

20180827 (Mon)

What if the buyer complain to the board that you simply inflate the price? Part 1

This is a very common problem in the estate agency practice. Especially, when there is no written document to prove that there was a change of instruction.

When the seller calls you to dispose of his property, he gave you an instruction to sell at RM350,000. However, after you have started advertising it, he called you after a week to change it. He changed his mind to increase the price to RM375,000. Now, you have two prices RM350,000 and RM375,000, a significant RM25,000 increase (25,000/350,000 x 100% > 7% difference!).

To safeguard yourself, you immediately changed the price in advertisement to RM375,000. However, you received calls that you were advertising it at RM350,000, NOT RM375,000! Some even accused you of inflating the price yourself to profit from it!

This issue need to be broken into two parts. Today, we just touch on Part 1.

Part 1 – which price is the right price?

RM375,000 is the rightful price. Why? Because you received a NEW instruction. Your appointment with the principal had been changed to the new price, not the old price. And, the communication was completed by the seller informing it to you as agent. S.4 of Contracts Act, 1950 says:

The communication of a proposal is complete when it comes to the knowledge of the person to whom it is made.

The new instruction was the change of price to RM375,000 and it was completed when it came to the knowledge of the agent to whom it was made.

Tomorrow, we continue discussion on this case.

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