Complaint #5: “Opes should have known this about the developer”
Another complaint we sometimes hear is if a client learns something about the developer and they feel we should have known that information and told them about it.
For example, one investor discovered a developer we recommended had been bankrupt in the past. But because that bankruptcy happened over a decade ago the developer didn’t need to tell us about it. Legally, they only need to disclose it if it happened within the last 7 years.
And information about the bankruptcy couldn’t be found online.
But this investor felt we should have found that information as part of our due diligence process (where we dig into the developer and their background).
Let’s put the facts of this specific example aside for a moment.
The truth is our property team goes through a thorough due diligence process for each developer, which includes asking hard questions and disclosing what needs to be shared.
However, there are sometimes differences between what we think is important to share and what an individual investor thinks is important.
So in the case of this investor we:
- Gave the client a full explanation of why the previous business failure hadn’t been identified (the developer didn’t need to tell us, and it wasn’t online)
- Apologised for the stress
- Agreed to provide a guarantee for any defects from the build for the first year
We can’t promise we’ll uncover every past event in a developer’s history, but we can promise transparency. And we always work to put things right when something unexpected arises.
