What is the ‘remaining term’ of a periodic tenancy?

What is the ‘remaining term’ of a periodic tenancy?

11:53 AM, 27th February 2018, About 4 years ago 25

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I wish to remove some of my properties from Haart Lettings in Fleet due to several reasons. These include be over-charged by tradesmen they have employed, lack of property management and generally very poor value for money.

When raising the question of how much notice was required to take back management myself, I was told (in summary) that 2 months notice plus the ‘remaining term of the periodic tenancy’. However, they would be prepared to limit this to a year’s fees!

I found this wording somewhat odd, so questioned whether the term of a periodic tenancy was in fact only a month as the same is merely a rolling month on month contract? The answer was that it was as long as that tenant remained a tenant in that property.

So in other words, Haart are saying that unless I evict the tenant that I paid a tenant finder fee for, and referencing fee as well as rent guarantee insurance, then the tenant provides a continued obligation for me to pay Haart management fees regardless of whether they are performing any work or not?

My gut feeling is telling me that this is pure bully boy tactics to maintain their income and there is no such thing in law as the remaining term of a periodic tenancy.

I would be pleased to hear any opinions and/or experience from others..

I have posted below the clauses in the contract that they are saying define this, although I have to say that I don’t read them that way at all.

Copied from the Letting Agent’s Branch Manager’s e-mail

In order to end the management of these two properties, you would need to serve 60 days’ notice in writing (which, due to the delay, I can to back-date to the 1st August) as per clause 7.1.3 of Terms of Business (TOB) version 1115 and version 0514 (“Either party may terminate this agreement by giving the other 60 clear days prior written notice of termination. Following termination the Landlord remains liable to pay to haart the amount of any fees due under clause 1.3 for any remaining term of the tenancy in question, together with other fees due. The full amount of such unpaid fees is due and payable at the date of termination and haart can set off the amount of such unpaid fees against any monies owed or to be paid to the Landlord by haart.”).

Once this clause is served, the following fees would be due as per clause 1.3 of TOB 1115 (“By agreeing to purchase haart’s Full Management and/or Rent Collection service (as set out in this agreement) the Landlord agrees to pay to haart fees at the rate set out in the Confirmation
of Marketing. If the Landlord terminates this agreement in accordance with its terms prior to the expected termination date of the original tenancy and any extension in question (including the remaining term of any periodic tenancy) they will remain liable to pay to haart those fees due for Full Management and/or Rent Collection for the remaining term as set out in the Confirmation of Marketing. For tenancy terms of less than 12 months, a minimum of 12 months fees will be chargeable.”)

…and clause 1.3 of TOB 0514 (“By agreeing to purchase haart’s Full Management and/or Rent Collection service (as set out in this agreement) the Landlord agrees to pay to haart fees at the rate set out in the Confirmation of Marketing. If the Landlord terminates this agreement in accordance with its terms prior to the expected termination date of the original tenancy and any extension in question (including the remaining term of any periodic tenancy) they will remain liable to pay to haart those fees due for Full Management and/or Rent Collection for the remaining term as set out in the Confirmation of Marketing.”)

Given that both tenancies are now periodic, we would only be looking to recover fees for 12 months on both properties, and none thereafter (if they stay for longer than 12 months from the (date)

André



Comments

by Muhammad Ali

0:01 AM, 28th February 2018, About 4 years ago

Good evening

I can see you having a few options

Option 1.
You ask agent to issue a new 6 month agreement. This way you give your notice at start of period. (Only pay 6 months agency fees)

Option 2
You ask agent to issue a new 6 months agreement as a tenant find only and not manage (only finders fee to pay)

Option 3
You issue new agreement direct (no longer periodic) and give your 2 months notice.

Hope this helps

Regards
Muhammad

by Andre Gysler

9:21 AM, 28th February 2018, About 4 years ago

Reply to the comment left by Muhammad Ali at 28/02/2018 - 00:01
Thanks. I was having similar thoughts to option 3 but wasn’t sure because of the 12 month minimum.

Either way it seems unfair to me as they have already had several years worth of fees

by Muhammad Ali

10:17 AM, 28th February 2018, About 4 years ago

Where does it stipulate 12 months?

Their own stipulation is until the end of a periodic period.

A periodic period is on a month by month basis!

With issuance of a new agreement starting from the next rent due date it voids any further contractual obligation under a periodic period.

It would be the same if the agent issued a new agreement, they would not chase a further 12 months management fee as well as a new management fee.

by Andre Gysler

10:20 AM, 28th February 2018, About 4 years ago

For tenancy terms of less than 12 months, a minimum of 12 months fees will be chargeable.”)

by ilc72

11:01 AM, 28th February 2018, About 4 years ago

Hi Andre

Has the relevant agreements from which you are trying to exit run for 12-months or more? If so, has a new tenancy agreement been signed?

If they have run for more than 12-months without a signed extension then you’d be looking at two-months fees.

It would be helpful if you enclosed the Terms of Business referenced in the post.

Finally, if you’d like to meet up with another local landlord then I’m based in Farnborough.

by Rod

11:23 AM, 28th February 2018, About 4 years ago

Re fees etc, one thing I have learned 'from tenants', don't pay, as there's not much they can do apart from the hassle and expense of going to court!!!

by Rod

11:35 AM, 28th February 2018, About 4 years ago

Further, tradesmen 'do' charge a scandalous amount of money for what they do which is usually a botched job! I think I'm in the wrong trade!

by Andre Gysler

11:47 AM, 28th February 2018, About 4 years ago

Hi Ian.

Thanks for the reply. I live in Wales now but my rentals are still in the Basingstoke area. Yes, I would love to meet up next time I am up there, Farnborough is only just up the road.

There are 4 properties in question here. One was a management adoption of an existing tenancy of mine, so there is no problem releasing that one.

Another was signed in May 2016 for 12 months and has not been renegotiated, so has defaulted to a Periodic. The Confirmation of Marketing for this refers to the Terms of Business (version 1115) .

The 3rd
And finally the 4th was a tenant who we directed towards Haart despite them was signed around June/ July 2015 and was renegotiated in July 2016 for a further 12 month period, which has now defaulted to a Periodic. The Confirmation of Marketing for this refers to the Terms of Business (version 0514) .
trying to insist they found the tenant. This in itself is a joke as it is the sister of one of my other tenants who has been with me for over 5 years! These tenants failed references but were willing to pay a year in advance and the mother stood Guarantor despite not having quite enough income to pass reference checks herself. But due to a lengthy relationship with her and her other daughter, and being a property owner herself, I made a character judgement myself and instructed Haart to grant the tenancy. They have proved to be model tenants in exactly the same way as the sister has been.

This 4th one was signed April 2017 for a 12 month period, which is soon to default to a Periodic. The Confirmation of Marketing for this refers to the Terms of Business (version 0716) .

So there are 3 different TOB's.

How do I upload them to here? They are in PDF format.

by Rod

11:56 AM, 28th February 2018, About 4 years ago

Agents look to renewing contracts as a nice little earner! No need to, just let them go periodic! I no longer renew any contracts and never had a tenant complain yet!

by John Frith

15:15 PM, 28th February 2018, About 4 years ago

I sympathise, but although reading a contract can be daunting, I'm willing to spend some time trying to do this before I sign to avoid this kind of situation. If a contract is not easy to understand, then I suspect it is loaded in their favour - as it is with all the insurance contracts I've had to sign (but there's no alternative!).
I have no expertise in contracts, but if I was in your situation, I think I would investigate if the contracts you signed might be considered an "unfair" contract. A quick search led me to the "Guidance for the Unfair Terms in Consumer Contracts Regulations 1999" here:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/284426/oft311.pdf
Where I spotted a bit that said it might apply to a "A term binding customers to go on paying when services are not provided".
Probably a slog to try and prove in court, but they may compromise to avoid testing the point.
Good luck.

Sorry I tried to edit this post, which resulted in the format getting screwed up!


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