Ending a management contract with a letting agent

by Readers Question

14:33 PM, 6th August 2013
About 5 years ago

Ending a management contract with a letting agent

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Ending a management contract with a letting agent

I rent 16 properties out and used an agent to manage them. I instructed them in 2007 and signed T&Cs. I recently added 10 properties to the portfolio and financially it made sense to employ someone to look after them rather than pay the agent fees.Ending a management contract with a letting agent

The T&Cs I signed state: “You may withdraw your instruction to us by giving 3 months written notice. In the event the properties are handed to you with tenants still in residence our charges will continue to be payable as if we were instructed on rent collection basis only”

So I gave the 3 months and they have deducted all of the monies for the fixed term contracts in one hit (e.g a contract due to expire in Feb 14 I have paid all of their fees till then now – really hit my finances hard best part of £10k in total).

They waived the fees for 2 flats fees as they were running periodic as a “good will gesture”.

However since the handover I have discovered 3 of the other flats charged out already have not had signed contracts returned, so are running periodic, yet I have been charged a years worth of management fees.

Also one of the tenants is breaking early in September and again, I have already paid for 6 months extra of fees.

They have emailed me today to say I won’t be seeing any refunds as it is also my liberty to chase the contract extensions!

The fees for just these 3 flats comes to £1,800 so I am keen to get a refund if possible.

Where do I stand legally on this? I understand the T&Cs I signed so reluctantly didn’t put a fight for the other 12 flats, but I feel a real injustice being charged for these periodic ones when they haven’t got the contracts signed – and I am still paying them!!

An interesting one and I look forward to your views.

Regards

David Hardcastle



Comments

Mark Alexander

14:41 PM, 6th August 2013
About 5 years ago

Hi David

That particular contract term does look rather harsh but I think you might find it difficult to argue that it's unclear.

The actual wording of their contract suggests to me that they could, in fact have continued to charge you their fees for as long as the tenants remain in occupation. You may have a case for a reclaim if the tenants move out during the period for which they have charged you, however, on the flipside they might argue and counter claim against you for the other tenancies which subsequently re-sign. Nowhere in the conditions does it state that they will only charge you for the term which the tenants commit to via the agent.

I despise conditions such as these and I feel they are blatantly unfair. However, the Courts have ruled on many occasions that if the conditions are sufficiently clear then they are also enforceable. Caveat emptor I'm afraid.

Did you get it in writing from them that the deductions they have made are in full and final settlement of your liability to them? If not, I suggest you at least push for that.

You could take the matter to the Ombudsman or other professional bodies these agents belong to but in all honesty I think it would be a futile exercise.
.

Tessa Shepperson

20:13 PM, 6th August 2013
About 5 years ago

If you were acting as a 'consumer' the clauses may be found to be unfair and therefore unenforceable under the Unfair Terms in Consumer Contracts Regulations. However as you own so many properties I suspect you would be classed as acting as a business rather than a consumer.

The Foxtons case in 2010 was about a similar point.

I mention this as other landlords reading this who only own one or two properties may be able to challenge these clauses.

Matthew Dickinson

11:42 AM, 9th August 2013
About 5 years ago

You have indeed been unfortunate, as was I with several different agents here in Newark! I am badly disabled so had to leave everything to the agents, foolishly trusting them to be honest, which with two of them was stupid. I am a retired detective, so should have known better, but my disabilities left me at their mercy. When I was on the point of going bust, I went to **AGENT DETAILS REMOVED BY MODERATOR** who have been honest and straightforward, which is something that the other agents were unable to be! One told me a property was empty when they had a tenant in it, and were keeping the rent and another charged me a fortune for what I later found were unnecessary repairs. Certainly any person who is able bodied would not have these problems, but Philip and Brenda at **AGENT DETAILS REMOVED BY MODERATOR**. have been wonderful with me!

**MODERATOR COMMENTS - Matthew has posted countless very similar comments, all of which are testimonials for the same letting agent**


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