Cold calls, texts and letterbox drops: the rules on agent prospecting

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Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

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Every listing starts with someone deciding to sell, and most agents do not wait to be asked. They phone owners in the streets where they have just sold, text people who came through an open home, email their database with a market update and put a flyer in every letterbox in the suburb. The trade calls it prospecting, and it is how much of the industry's work is won.

Each of those four channels is regulated, and not by the same law or the same regulator. A phone call falls under the Do Not Call Register Act. A text or an email falls under the Spam Act. The use of a person's details to target them falls under the Privacy Act. A flyer in a letterbox falls under a Queensland environmental statute. This guide sets out what each requires, where agents most often misjudge the line, and what a home owner on the receiving end can do. It describes the rules in general terms and is not legal advice on any particular campaign.

Sources: Telemarketing and Research Calls Industry Standard 2017; Australian Communications and Media Authority guidance on the Spam Act; Office of the Australian Information Commissioner, APP 7 guidelines.

Four channels, four sets of rules

The simplest way to hold the subject in mind is by channel.

The laws do not overlap as much as the table might suggest. The privacy principle on direct marketing steps back where the Spam Act or the Do Not Call Register Act applies, so a phone call or a text is judged under those Acts. And a flyer that is not addressed to anyone by name uses no personal information at all, which is why it is left to State law.

Phone calls and the Do Not Call Register

The Do Not Call Register is a list of Australian phone numbers whose owners have said they do not want marketing calls. It is run by the ACMA. Making an unsolicited telemarketing call to a number on the register is unlawful unless a defence applies.

The first question is what counts as a telemarketing call. The ACMA's information sheet for the real estate industry answers it with examples from the trade. A telemarketing call is a voice call made to offer or promote goods, services or land, or a business or investment opportunity. For an agent, that includes a call offering a free appraisal, a call following up after a property inspection, and a call soliciting a listing. Those three examples cover most of what prospecting by phone consists of.

Some calls are outside the definition. The same sheet lists calls to fix a fault, to reschedule or remind someone of an appointment, calls about a payment, and calls the person asked for. An agent phoning a seller about an offer on their own house, or a tenant about an inspection, is not telemarketing.

The second question is whose number it is. An agent who rings a number on the register to offer an appraisal has broken the law unless the person consented. So the central task in phone prospecting is knowing which numbers are registered, and which of the people behind them have agreed to be called.

Consent to be called

The ACMA distinguishes two kinds of consent, and the difference is where agents most often come unstuck.

Express consent is the clear kind. The person agrees to be called and gives their number for that purpose. The information sheet suggests an attendance sheet or a tick box with plain wording, and warns that text which is too small or hidden, or a sign on a wall, is unlikely to be enough. Express consent does not last for ever. On the ACMA's guidance it generally lasts three months unless a different period was specified, and any longer period must be made clear to the person when they agree. If a complaint is made, it is for the caller to show the consent, so records matter.

Inferred consent comes from conduct and from the relationship between the parties, and it is judged case by case. The sheet's real estate examples are instructive. Where the dealing was a single transaction, as with a seller or a buyer, consent can usually be inferred only for the life of that transaction; calls months after settlement are unlikely to be reasonable. Where there is a continuing relationship, as between an agent and a landlord whose property the agency manages, consent may be inferred for calls about other relevant services. And having a number is never enough by itself. Consent may be inferred for calls about the particular property a person enquired about, but not for calls about unrelated listings.

That last point bears directly on the open home. A visitor who writes a phone number on the sign-in sheet has, at most, shown interest in that property. Whether the agent may call them next month about a different house, or about selling their own, depends on what the sheet told them they were agreeing to. The ACMA's own conclusion is that express consent gives greater certainty than inferred consent.

Washing a list, and who answers for it

Checking a calling list against the register is known as washing. The ACMA operates the washing service, for a subscription fee based on volume, and the result is the list with registered numbers marked.

A washed list is good for 30 days. The ACMA's sheet advises agents who buy lists from a supplier to obtain the exact date of the wash and proof that it was done, and to make their calls within 30 days of that date.

Responsibility does not pass to the supplier. Liability for a breach lies with the person who made the call or caused it to be made, not with whoever sold the list. The sheet adds a detail that catches people out: the 30-day defence belongs to the person who performed the wash. An agent calling from a list someone else washed cannot rely on it directly, though they may be able to argue that they took reasonable precautions.

The penalties are civil, not criminal, and they are large. The register's published guidance gives the ceilings as up to $222,000 in infringement notices for each day on which contraventions occurred, and up to $2.22 million a day if the matter goes to court. It also describes the regulator's approach as graduated, with most complaints resolved informally through education.

Hours and the conduct of a call

A separate instrument governs how any telemarketing call is made, whether or not the number is on the register. The Telecommunications (Telemarketing and Research Calls) Industry Standard 2017 applies to anyone who makes or arranges such calls to Australian numbers.

Its best-known rule is about time. Telemarketing calls may be made on weekdays from 9am to 8pm and on Saturdays from 9am to 5pm. The standard does not permit them on Sundays. A call outside those hours is allowed only if the person has agreed to be called at another time.

The standard also sets how the call must be conducted. The caller must give certain information as soon as the call starts, including their name and the purpose of the call. The call must be ended when the person asks, or otherwise shows that they do not want it to continue. And calling line identification must be switched on, so that a number is displayed. A call that shows as "private" breaks the rule.

A breach of the standard carries its own penalty, of up to $250,000 for each contravention according to the register's guidance.

Texts and emails under the Spam Act

Text messages and emails are regulated differently, and in one respect more strictly: there is no register to check. Under the Spam Act 2003 every commercial electronic message needs three things.

The first is consent. The ACMA's guidance says a business needs consent from each recipient before sending marketing messages, even if someone else sends them on its behalf. Express consent is best practice and can be given on a form, by a tick box on a website, over the phone or in person. It cannot be requested by sending an electronic message asking for it. Inferred consent may exist where the person knowingly gave their address and would reasonably expect the marketing, which usually requires a continuing and provable relationship. The guidance is explicit that it does not stretch to unrelated products.

The second is identification. Each message must accurately identify the business that authorised it and include correct contact details, and that information must stay accurate for at least 30 days after sending.

The third is a way out. Every message must contain an unsubscribe facility with clear instructions. A request must be honoured within five working days. The facility must work for at least 30 days after the message is sent, and must not require a fee, extra personal information or a login. For text messages there is a technical trap: a message sent from a name instead of a number generally cannot receive a reply, so "reply STOP" does not work from it.

For an agency the rule that bites hardest is the one on lists. The ACMA's guidance states that a business remains responsible for confirming consent for every address on a list it buys or uses. A database inherited with a rent roll, bought from a supplier or carried across by a new recruit from a previous employer is not cleansed by the transfer. And lists built with address-harvesting software may not be used or supplied at all.

Privacy law and where the details came from

Behind every call and message is a question the first two Acts do not ask: how did the agency come to have this person's details, and is it entitled to use them for marketing? That is the territory of the Privacy Act and its Australian Privacy Principle 7.

The principle starts from a prohibition. An organisation must not use or disclose personal information for direct marketing unless an exception applies. The Office of the Australian Information Commissioner's guidelines describe two main ones.

Where the organisation collected the information from the person themselves, it may use it for direct marketing if the person would reasonably expect that. The test is objective, and the guidelines say it is not reasonable to assume the expectation merely because the person might welcome the marketing. Telling people at the point of collection that marketing is one of the purposes is the ordinary way to establish it.

Where the information came from someone else, or the person would not expect the use, the organisation needs consent, unless obtaining it is impracticable. Inconvenience or cost alone does not make it so.

In both cases there must be a simple way to opt out, and where the information came from a third party each communication must carry a prominent opt-out statement. A request to opt out should be acted on within a reasonable period, which the guidelines put at generally no more than 30 days, and free of charge.

One right under the principle is little known and useful. A person may ask an organisation where it got their details, and the organisation must tell them unless that is impracticable or unreasonable. For an owner who receives a personally addressed letter from an agency they have never dealt with, it is the direct way to find out which data supplier is behind it.

Two limits should be kept in mind. The principle does not apply to the extent that the Spam Act or the Do Not Call Register Act covers the communication. And the Privacy Act does not reach every business: it generally exempts small businesses with an annual turnover of $3 million or less, subject to exceptions.

The letterbox

The oldest prospecting tool is the least regulated. A flyer delivered to every house in a street, addressed to no one or "to the householder", is what Queensland law calls unsolicited advertising material. It is dealt with in the Waste Reduction and Recycling Act 2011, as litter prevention.

The Queensland Government's guidance sets out two rules.

The material must be delivered securely: into a letterbox or similar receptacle, or under a door. It must not be left on a vehicle, a building or a fixed structure without the express permission of the owner. A flyer tucked under a windscreen wiper or taped to a gate is a breach where one pushed properly into the letterbox is not.

And it must not be delivered where a sign refuses it. A household with a clear sign on the letterbox or fence, such as "No Junk Mail", "No Advertising Material" or "Australia Post Mail Only", should not receive unsolicited advertising material. The guidance lists what the sign does not stop: political campaign material, neighbourhood watch letters, lost animal notices and council newsletters, none of which are advertising in the Act's sense.

A letter addressed by name to the owner is a different thing. It is not unsolicited advertising material under the State rules, because it is addressed. It is direct marketing under the privacy principle, because someone used personal information to choose the recipient. The "No Junk Mail" sign does not apply to it; the right to opt out, and to ask for the source, does.

What a home owner can do

The remedies follow the channels.

For calls, a number can be added to the Do Not Call Register, and registration is free. A marketing call to a registered number, a call outside the permitted hours or a call with no number displayed can be reported to the ACMA. The person can also simply tell the caller not to ring again, which withdraws any consent the caller was relying on.

For texts and emails, the unsubscribe facility is the first step, and a message without one, or one that keeps arriving more than five working days after a request, can be reported to the ACMA.

For addressed mail, the request goes to the sender: stop, and tell me where you got my details.

For flyers, the Queensland Government's guidance points first to the Distribution Standards Board, the industry body for letterbox distributors, and then to the department's own reporting form if deliveries continue. Material left on a vehicle or a building can be reported through 13 QGOV.

What it means inside an agency

None of these rules forbids prospecting. They regulate how it is done, and they put the burden of proof on the business. In each regime the question a regulator asks is the same: can you show that this person agreed, or that you checked?

That makes record-keeping the practical centre of compliance. An agency that can produce the sign-in sheet with its consent wording, the date a list was washed, the unsubscribe log and the source of each contact is in a different position from one that cannot. So is an agency that has decided who owns its database. A salesperson who leaves with a phone full of contacts, or arrives with one, raises every question in this guide at once, and the liability for a call rests with whoever made it or caused it to be made.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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