Penanlty when terminating Landlord and Letting Agency Contract

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    Penanlty when terminating Landlord and Letting Agency Contract

    I sold a few apartments with sitting tenants. The new owner appointed their own letting agents.

    In my agency contract there is a clause that entitles the agent to charge me fee for the duration of the tenancies when the properties are sold. This means I neither own the properties nor collect rents but had to pay agency fee on future rents that I do not get. The agent deducted the penalty (fees) from the last rental collections.

    Although it is in the contract - which I signed without realising, I feel this is unfair trading and unethical practice.
    The amount is approximately 6,000 pounds.
    What can I do?

    #2
    Google the OFT v Foxtons.

    The fee on sale is almost certainly unfair if you are trading with the agent as a consumer.
    If you are a professional / medium to large scale landlord, you won't be trading as a consumer.

    You should have known that the fees were in your agreement - they shouldn't have been a surprise, though.
    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).

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      #3
      You should read: Competition & Market Authority guidance for Lettings Professionals on Consumer Protection Law/ chapter Renewal Commission and Sale Commission/ Article 4.22: "....CMA considers the following terms, in particular, are likely to be found to be unfair. As such they would not bind consumers even if they had signed a contract agreeing to be bound by them, and therefore we consider they should not be used or relied upon in contracts with consumer landlords * Terms which require landlords to pay agents renewal commission after the sale of their property to a third party (‘third party renewal commission’) because the original tenant remains in occupation..."

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