Hamilton-based real estate firms ordered to pay $4 million for price-fixing

Lodge and Monarch have been penalised for their roles in coordinating the Hamilton regional response to Trade Me’s pricing decision.

The Auckland High Court has ordered Hamilton-based Lodge Real Estate Limited (Lodge) to pay $2.1 million and Monarch Real Estate Limited (Monarch) to pay $1.9 million for engaging in price-fixing in breach of the Commerce Act.

The Court's penalty judgment brings an end to proceedings the Commission first filed in December 2015 against 13 national and regional real estate agencies and three individuals for agreeing to pass on the costs of Trade Me's pricing change for real estate listings to vendors. The final total of penalties imposed in this case is just under $23 million.

Lodge and Monarch have been penalised for their roles in coordinating the Hamilton regional response to Trade Me's pricing decision. The High Court did not require a director of Lodge and a director of Monarch to pay a penalty despite the Court of Appeal finding they did engage in unlawful conduct, which was upheld in the Supreme Court.

"It is not unusual for industries to experience price increases from suppliers and this case illustrates how important it is that companies avoid any discussions with their competitors on how they could or should respond to such a change," Commission Chair Anna Rawlings said.

"Cartels can harm consumers and business, by raising prices, restricting supply and changing the competitive dynamic between businesses.

"The nearly $23 million in total penalties handed down, in this case, is substantial and from April next year cartel conduct will also be a criminal offence subject to a maximum term of 7 years' imprisonment. We strongly urge businesses to familiarise themselves with the law and ensure they have processes in place to guard against collusion with their competitors."

A copy of the penalty judgment is on the Commission's case register.