Disclosure of Letting Agent Commission To Contractors

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    Disclosure of Letting Agent Commission To Contractors

    Hi Guys

    Hoping someone can help?

    Do letting agents have a duty to disclose upfront to landlords whether they charge their contractors commission for work done on properties they fully manage?

    Thanks for any advice

    #2
    The agent has a duty not to make secret profits (which undisclosed commissions would be) from landlords.
    In theory (although this hasn't yet been tested in court specifically relating to repairs) the agent's "commission" is actually the landlord's and is simply being held by the agent on trust.

    It is a common practice, and many agents try and circumvent the letter of the law by not charging a commission per transaction with a supplier, but a less formal mechanism where sums of money are paid or gifts received but not obviously related to specific transactions.

    A practical solution is to not allow your agent to carry out any repairs or incur costs without your approval.
    If they offer to fix a radiator for a sum of money and that sum seems reasonable, even if there is commission hidden in it, you are (in a practical, not legal or moral sense) no worse off.
    It's when the costs get stupid everyone suffers - http://www.telegraph.co.uk/finance/p...tons-case.html
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      Originally posted by jpkeates View Post
      In theory (although this hasn't yet been tested in court specifically relating to repairs) the agent's "commission" is actually the landlord's and is simply being held by the agent on trust.
      Quite a bold statement.

      Secret profits belong to the principal. That's established.

      Comment


        #4
        Originally posted by jjlandlord View Post
        Quite a bold statement.
        http://www.propertyindustryeye.com/r...to-the-client/
        The case establishes the principle for one type of secret commission, but there's not been anything I am aware of to extend it to the sort of commission being discussed here.
        In theory it applies generally.
        When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
        Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

        Comment


          #5
          It applies generally, as said.

          Comment

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