Legality of Renewal fees for Periodic Tenancies?Make Text Bigger
Dear P118 readers, I wonder if anyone has had experience with this issue lately?
I am using Foxtons to let a property (as they had an offer on at the time) and the fixed term (18m) is coming to an end in 60 days. I was called by Foxtons asking if I wanted to renew or get the tenant out.
I informed them I may be reverting to a periodic tenancy as I wanted the flexibility of vacating the premises. Foxtons informed me that despite them not doing any work after the initial contract, I would still be liable for a 9%+Vat Renewal fee even for periodic tenancies.
Now, I have read the OFT ruling back in 2010 which laid out:
On the 19th July 2010 the Office of Fair trading released a press release on its evaluation of its consumer enforcement case against Foxtons for breaching the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCRs). In February 2010, the OFT secured an enforcement order from the High Court when it ruled that Foxtons’ renewal commission terms were not transparent, this led to Foxtons amending some of the terms. The evaluation has now found that the OFT intervention has resulted in positive benefits for consumer landlords that use Foxtons with an estimated annual benefit of at least £4.4 million.
The enforcement order relating to Foxtons declared that the terms listed below are unfair, not binding, and may not be used or relied upon in contracts with consumer landlords:
a. Terms which require landlords to pay renewal commission to Foxtons after the sale of their property to a third party because the original tenant remains in occupation.
b. Terms which require landlords to pay a sales commission to Foxtons in the event they sell the property to their tenant.
c. Terms relating to renewal commission, where the tenant remains in occupation, and in some cases an occupant introduced by the tenant, after the initial fixed term where the agent is not asked to provide any additional service.
My issue related to part C of this order. I wonder whether this is relevant nowadays as foxtons have amended their terms to be more clear that they want to charge these fees (as before they were buried in small print). They are still charging the same fees, they are just in larger print now.
I have never paid an agent renewal fees for a periodic tenancy so I wanted to know if this is still working practice among landlords, despite signing an agreement where their terms stated I would pay them a commission even in a “hold over” tenancy.
It is a confusing topic as on the one hand, the OFT ruling states they cannot charge fees on renewals where they do no work and on the other hand, their terms and conditions to this day still quote the fees.
Any advice would be appreciated.
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