'Some lawyers overcharging home-buyers’

Press, 15 May 1985, Page 3

'Some lawyers overcharging home-buyers’

PA Wellington Some lawyers were grossly overcharging lowincome home buyers for straightforward conveyancing (property transfer) services, said the Housing Corporation’s director-general, Mr Ron Kelly, yesterday. Since the recent abolition of the Law Society’s scale fee, the corporation had recorded instances where fees in excess of $7OO, and in a few cases fees, exluding disbursements, exceeding $lOOO, had been charged to people on modest incomes. Mr Kelly said that such high fees were not uncommon. A social welfare beneficiary had recently been charged $2OO for a transaction to refinance a $6500 mortgage, and another beneficiary had been billed $BOO for the purchase of a $48,000 house. Both fees excluded disbursements. A fee of between $250 and $4OO, plus disbursements, was reasonable for straightforward modest property transactions of up to $85,000, Mr Kelly said. He said that the former president of the Law Society, Mr Bruce Slane, had made a personal attack on corporation staff in opposing the Government’s decision to compete direct with lawyers in conveyancing matters. Mr Slane said last week that he believed anyone dealing with a big transaction financed by a Government department needed his or her own private advo-

cate, “not an employee in the Government office bound by the Public Service rules, by seniority, by personal career ambitions, and required to proclaim support for and to promote the policies of the (Housing) Corporation.” Mr Kelly said these comments were neither appreciated nor appropriate. The corporation’s conveyancing proposal was initiated by the Government, and the corporation was simply complying with the Government’s directive to consider the proposal, he said. The Government decided earlier this year to allow the corporation to provide a self-supporting conveyancing service to its clients. The scheme is yet to start. Mr Kelly said that meantime the corporation had opened its books and accounts to Law Society accountants to enable the society to be satisfied on the costing of proposed fee charges and to allow the society to make submissions to the Government. One of the Law Society’s main concerns was the corporation’s proposed fee charges, which at this stage could be between $250 to $350, excluding disbursements. “Perhaps the society will allow the corporation’s accountants to examine the j books of lawyers involved in | conveyancing so that we may examine their methods and costings,” said Mr Kelly.