Case B · Nationwide pattern · April 2026
Disclosure becomes amplification
A vendor receives an agent-drafted "Disclosure Statement" for approval. The items extract findings from the building report into a standalone bulleted list. One item has no building-report page number; it describes an era-generic risk. Language is stronger than the report's own wording. The sales manager is said to have encouraged one specific addition. The pattern is legally defensible in each element but structurally hostile to the vendor's interest.
Pattern
The structure
The agency produces a "Disclosure Statement" as a standalone document to accompany the building report in marketing materials. The statement extracts items from the report and lists them as bullets. The building report itself will also be provided. The result: each item appears twice — once in the 60-page professional report (with context, hedging, and mitigation), and once as a concentrated bullet (without context).
One item in the disclosure is not traceable to a specific building-report page. It is a generic statement about the era of construction (for example, "properties of this era may have contained asbestos"). It is true of every NZ home built before approximately 1970. It is not a specific finding about this property. The agent mentions, in passing, that the sales manager encouraged its inclusion.
A further item uses language materially stronger than the report. The report uses "resurface" and "minor"; the disclosure uses "replace" and "significant."
A standard clause ("Purchasers are advised to seek their own professional, independent advice / legal advice") is rendered in yellow highlight in the document. The agent explains that Lowe & Co management require this highlighting. No specific section of the REA Act or PCCC Rules mandates a highlighting colour.
The motive calibration
Several explanations are consistent with what the vendor observed. The agency may be managing its own liability exposure under the licensee disclosure duty by adding era-generic statements. The agent may be acting on professional judgement about buyer expectations. What is observable without needing to adjudicate motive: every element of the pattern transfers risk or negotiating leverage from the vendor to the agency or the buyer. Where cost and benefit consistently fall on opposite sides of a fiduciary relationship, scrutiny is warranted.
Legal basis for the vendor's position
- PCCC Rule 10.7 — A licensee must disclose known defects to a prospective client. Era-generic statements are not known defects; they are risk categories true of many homes. Rule 10.7 does not require their inclusion.
- PCCC Rule 9.1 — Act in the best interests of the client (vendor). A disclosure document that amplifies risk beyond what the underlying evidence supports is hard to reconcile with that duty.
- Fair Trading Act 1986 s.9 — Misleading or deceptive conduct. Presenting an era-generic risk as a property-specific finding is potentially misleading.
Response template
The vendor requests amendment, item-by-item, against four tests: source traceability, duplication with documents being provided, property-specific vs era-generic, language proportionality.
Hi [agent], thank you for the updated disclosure draft. Before I approve, I have the following requests:
1. Since the building report will be provided to purchasers, items that are detailed in the report do not need to be duplicated in a standalone disclosure. Please amend to reference the report pages directly.
2. Item [X] appears to be a general era-category statement rather than a specific finding about this property. Rule 10.7 requires disclosure of known defects. Please remove, or identify the specific known finding.
3. Item [Y] uses language materially stronger than the report (e.g., "replace" vs "resurface"). Please match the disclosure language to the report.
4. On the yellow-highlighted clause: please identify whether the specific wording and formatting is required by REA Act or PCCC Rules, or whether this is internal agency policy.
I will sign once these points are addressed.
Full template: Disclosure amendment request.
Lessons for vendors generally
- The page-number test. Any disclosure item without a building-report page reference is either a vendor-supplied finding or an agency addition. Agency additions can be declined unless they correspond to known defects.
- The sales-manager test. When the agent explains that "management encouraged" a specific addition, the addition is agency-policy origin. Rule 10.7 is not the basis for it.
- Language matters. "Replace" is not the same as "resurface." "Significant" is not the same as "minor." Match the disclosure language to the underlying evidence.
- Good faith vs legal compliance. Each element of the pattern may be legally defensible. The aggregate operation — systematically shifting risk to the vendor — deserves scrutiny as a whole, not just element by element.