Breaking Away from Letting Agent

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    Breaking Away from Letting Agent

    Hi

    My friend wants to end her contract with the managing estate agent after three years.

    I said I'd make some enquiries for her and I've done a bit of reading and the key thing is to look through what paperwork she signed initially. If she is able to exit from them, what happens to the deposit they are holding? It appears they have protected the deposit through 'mydeposits'.

    Many thanks
    Claymore

    #2
    She'll no doubt have to pay a fee to cut all ties, just ensure it is final i.e. they won't try to come back with renewal charges etc. The deposit would be transferred to your friend, would be prudent to open an account with the DPS soonish.
    <a href="http://www.manchesterpropertygroup.co.uk/" target="_blank">Manchester letting agents</a>

    Comment


      #3
      Originally posted by jrsteeve View Post
      She'll no doubt have to pay a fee to cut all ties.
      I doubt it as it might be a 'penalty' which of course is unenforceable. After three years I would not expect to pay an agent anything extra for ending such a contract.
      The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

      Comment


        #4
        The agents are quite cheeky. It turns out they are charging the tenants £250 each 12 months to renew their AST and they are also charging the landlord £125. She originally paid a finders fee and then they take 10% for managing the property.

        Why would a penalty to terminate an agreement be 'unenforceable' if it is something the landlord agreed to?

        Many thanks
        Claymore

        Comment


          #5
          Originally posted by Claymore View Post
          Why would a penalty to terminate an agreement be 'unenforceable' if it is something the landlord agreed to?
          Because the OFT says so; it considers any 'penalty' clause within contracts as 'unreasonable', and therefore unenforceable. Just because a landlord has "agreed" to something doesn't mean to say it's right.
          The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

          Comment


            #6
            Wouldn't it be a secret profit if the agent were charging the tenant to renew the tenancy agreement without the landlord's knowledge?

            Comment


              #7
              Fantastic Paul_f - thanks for the information.

              Comment


                #8
                Originally posted by jjlandlord View Post
                Wouldn't it be a secret profit if the agent were charging the tenant to renew the tenancy agreement without the landlord's knowledge?
                Not at the moment it seems but probably will be once the Consumer Rights Bill becomes law.
                The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

                Comment


                  #9
                  Originally posted by Paul_f View Post
                  Not at the moment it seems
                  How come?
                  Isn't the agent making money while acting for his principal?

                  Comment


                    #10
                    Originally posted by Paul_f View Post
                    Because the OFT says so;
                    I would rather say it is because it is a principle of trite contract law, rather than a principle of the OFT. Because the OFT doesn't make law I hope

                    It has been stated back in the famous Dunlop case in early 1900 that damages for breach can only be for recovering losses, not anything above this (putting the party into the position it would have been in had the breach not occurred). Parties can fix those damages ("liquidated damages") but they need to be a genuine pre-estimate of losses, anything else is an unenforceable penalty.

                    Comment


                      #11
                      A little more help would be appreciated. This is what I am going to suggest to my friend:

                      She writes a letter to the managing agent giving them notice to terminate the contract (2 months) as this is when her tenants current AST expires. She requests the full deposit is repaid to her as soon as possible (or should they transfer it into the DPS?). She also requests the original tenancy application etc.

                      She should also write to the tenants informing them that she has ended her contract with the agent and that she is now managing the property herself.

                      Is there anything else that needs to be done?

                      Many thanks
                      Claymore

                      Comment


                        #12
                        Hi

                        Are the letting agents 'obliged' to hand over the original documentation - ie, the inventory and tenancy application forms etc?

                        Many thanks
                        Claymore

                        Comment


                          #13
                          The agent is obliged to give her at least copies of all documentation she requests about the tenant (the DPA doesn't apply if they offer that excuse - it's her tenant not theirs). She should however have the original AST and inventory (why doesn't she have it already?)

                          She will need the tenant's written permission to place the deposit in another scheme or to re-register it. She should also notify them of the change in agency arrangements.
                          The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

                          Comment


                            #14
                            Thanks Paul_f

                            She may already have the original AST and inventory, but I was asking just in case. She is coming over to see me this morning and bringing with her all copies of documentation that she does have.

                            Comment


                              #15
                              Yes, she has original tenancy agreement.

                              Many thanks.

                              Comment

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