Golden Handcuffs?

by Readers Question

13:17 PM, 14th November 2019
About 4 weeks ago

Golden Handcuffs?

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Golden Handcuffs?

I have 3 flats in the West Midlands area which are managed for me under “full management” by “Shoddy Ltd”.

I would like to appoint a new managing agent and hence would like to terminate Shoddy Ltd’s services. When I informed Shoddy Ltd, they advised me that they had changed their terms and conditions the previous year. The result, they explained, was that although I could change agents, Shoddy Ltd would still be entitled to the full management fee as long as the tenant remains the same.

When I looked at the detail of the contracts related to the current tenants, I could see that one of the flats contracts does have a clause to this effect. Clearly now, I wish I hadn’t signed that contract.

The contracts for the other 2 flats are very old and do not have such a clause. Shoddy Ltd advises me that their terms and conditions take effect for all properties, irrelevant of the contracts signed.

Has anyone else been held ransom by Golden Handcuffs?

What is the normal procedure to get out of such a contract / terms and conditions?

Sam



Comments

Neil Patterson

13:24 PM, 14th November 2019
About 4 weeks ago

I don't think they can hold you to the new clause for previous contracts though. Unless maybe the previous contracts were explicitly detailed and named.

Luke P

15:12 PM, 14th November 2019
About 4 weeks ago

If you leave, they will have to pursue you for the money. Don't get into a back-and-forth with them, just wait for your day in Court and present it as completely and wholly unreasonable.

Paul Shears

21:36 PM, 14th November 2019
About 4 weeks ago

This is clearly manipulation by the agent hoping that you will not stand up to them. A bit like the car park fine scammers that we that we so much about.
I'm wondering if a bit of weekend national press input would frighten them off.
It has worked for others.
Frankly you have little choice but to stand up to them unless you evict the tenants.
One of these agents tried a similar scam on me by sending me the terms of the contract ten minutes before meeting me on site.
The agent was clearly very shocked that I had read the contract by the time that she arrived and immediately offered to remove the offending scam clauses from the contract after I told her that the whole situation was absolutely outrageous.
Needless to say, I did not employ the agent but I could so easily have been subject to a similar scam.

Sam Caine

10:39 AM, 15th November 2019
About 4 weeks ago

Thanks for all the helpful comments. I'm most grateful.

I've been wondering what my best argument could be. I came across the
Consumer Rights Act 2015 and EU Directive on Unfair Terms in Consumer Contracts. To me these seem to point clearly in my favour, but perhaps I'm missing something?

Have you any experience in using these arguments perhaps?

Sam

Peter Tanczos

10:41 AM, 15th November 2019
About 4 weeks ago

Unfortunately, you signed for what's on the contract. This means full fee on the newer contract, but they get nothing (unless there's some kind of breakaway clause) for the 2 older contracts, if that clause isn't in there, it doesn't apply. They can say what they like, if they want to change T&C's they have to renegotiate the contracts. Strictly speaking, contracts are supposed to be renewed once they expire but it's standard practice that the T&C's and the contract extends with no changes to T&Cs past its expiry date if both parties are happy with the arrangement. I was a leaseholder in a block of flats above a parade of shops, all the leases were different, but because my T&Cs were different on mine, the management company had to renew my front door free of charge (unlike some of the other leaseholders) to comply with Fire Regulations. Pay the fee for the newer contract and send copies of the older contracts to them highlighting that as those are the T&Cs you agreed to and signed, those are the T&Cs that apply.

Darren Peters

11:14 AM, 15th November 2019
About 4 weeks ago

If I understand correctly, if the tenants vacated and new ones came along, that would be the end of Shoddy Ltd's contracts?

A bit left-field but if the flats are similar, could you end all the tenancies but offer a new tenancy next door on very favourable terms? Ie Flat 1 moves into 2, Flat 2 moves into 3, flat 3 moves into 1?

Paul Shears

11:17 AM, 15th November 2019
About 4 weeks ago

I see no reason why not. They would have a hard day fighting that one in court.
🙂

Stewart W Campbell

11:19 AM, 15th November 2019
About 4 weeks ago

I had the same problem with 2 properties,
I had a FAILING Mgt Agent numerous incidents all documented and most via emails.
I offered a termination fee.
They refused and relied on their contract.
I took it to the Property Ombudsman, as an UNFAIR CONTRACT CLAUSE and my offer of 3 months termination fee, with all my evidence of the agents failing including LYING to my tenants that they were awaiting my permission to do work when they had NOT even tried to get to me.

It took Months but the Ombudsman agreed with my Unfair contract clause and the agents failings. I had to pay a fee BuT KEPT my GOOD TENANTS.
Have a look at the Ombudsman's web site it has useful information.

Stewart

Sam Caine

14:32 PM, 15th November 2019
About 4 weeks ago

Excellent ideas and advice. Thank you all so much. That will keep me busy this weekend!

Sam


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