can agency charge me more than 3200£ for early termination cost of tenancy agreement?

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    can agency charge me more than 3200£ for early termination cost of tenancy agreement?

    Hello, can you help me please? I had an assured shorthold tenancy agreement for 3 years. I had some financial difficulties and I gave 2,5 months notice to landlord and agency that I want to leave the flat earlier because I won't be able to pay for it anymore. In total I lived in the flat and payed rent for 1,5year and a few days. My tenancy agreement don't have a break clause. But it have an early termination cost: the agent comission for rest of 1,5 year of my contract, which landlord paid to the agency is more than 3200£. They found a new tenant, she started living in the flat when I mooved out. Also in early termination cost it's write that I'll need to pay rent diffrence if the new tenant will pay less rent than me. I met the new tenant who now live in the flat and I know she pay 100£/month less rent than me, but the agency didn't told me anything about it.
    So they want to deduct all money from my deposit and I'll own them around 1600£ more. Also, now they texted me that the landlord want to deduct more than 300£ from my deposit for the new tenant which he should pay to the agency. Can you tell me please if they can charge me all this money and I should pay it? Thank you.

    #2
    They can charge whatever they like.

    You can propose whatever charge you like.

    But you both need agreement or you owe all rent to end of tenancy
    I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

    Comment


      #3
      If the property has been re-let, the tenancy must have ended.

      If it was re-let by the same agent, I doubt that they would succeed in getting their commission for any time after it was re-let. They have a duty to mitigate their costs, which they have done by re-letting it. Courts don't like penalties.

      The difference in rent, you may well have to cover.

      Comment


        #4
        The property was re-let to new tenant, but it was another agent, not the same agent who let it to me. They didn't inform me that they are going to re-let it for a cheaper price, they told me it's the same price as I pay.

        Comment


          #5
          Originally posted by leaseholder64 View Post
          They have a duty to mitigate their costs, which they have done by re-letting it. Courts don't like penalties.
          The landlord probably have a contract with their agent to pay commission for the length of the entire fixed term, possibly in advance, even if tenancy was terminated early. The landlord's term with the tenant would be to recover the cost of that in the event of agreed early termination.
          I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

          I do not answer questions through private messages which should be posted publicly on the forum.

          Comment


            #6
            What exactly does the agreement to end the tenancy early say/
            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


              #7
              Originally posted by KTC View Post

              The landlord probably have a contract with their agent to pay commission for the length of the entire fixed term, possibly in advance, even if tenancy was terminated early. The landlord's term with the tenant would be to recover the cost of that in the event of agreed early termination.
              That is why the first sentence of the paragraph from which you took the quote, asks whether the same agent was used.

              However, wouldn't the first agent go after the landlord for the commission and wouldn't it be the case that the landlord could have mitigated that cost by going through the same agent, so it might be rather difficult to pass that cost on to the ex-tenant.

              Comment


                #8
                By mitigation of loss, you're thinking of compensation for breach of contract. This wouldn't be the case here. The agent's fee is X% of the total rent for the tenancy agreed between the landlord and tenant. The landlord is going to be contractually obliged to pay that fee. It's just the landlord is trying to pass it onto the tenant for agreeing to an early termination.

                Originally posted by leaseholder64 View Post
                However, wouldn't the first agent go after the landlord for the commission and wouldn't it be the case that the landlord could have mitigated that cost by going through the same agent, so it might be rather difficult to pass that cost on to the ex-tenant.
                Landlord have no duty to mitigate for loss of rent. They can let the tenancy continue until the end and sue for unpaid rent, or they can agree an early termination in which case the terms are whatever's agreed between the landlord and tenant.
                I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                I do not answer questions through private messages which should be posted publicly on the forum.

                Comment


                  #9
                  I have a similar situation whereby my tenants on a 2 year agreement want to terminate a few months early. According to our tenancy agreement, the tenants would still be liable for all the rent up to the end of the agreement even if they left early. So if I wanted to be a nasty landlord, I could hold them to that and devour all their deposit. But as they have been really good tenants, I wouldn't like to do that, and want only charge them the rent for the standard 2 months notice period.

                  But the tenancy agreement also specifies that if the tenants initiate early termination, then instead of the landlord being liable for all the remaining agency commission fees to the end of the agreement, this liability is passed to the tenant. The agent, however, agreed that if they let the property before the end of the agreement, then the remaining fees would be waived. This seems reasonable, but does have the disadvantage that it means I'm effectively stuck with using the same letting agency, not really something I was planning on doing.

                  Seems to me that these long tenancy agreements only really seem to benefit the lettings agency, unless of-course, you don't use a letting agent.

                  Comment


                    #10
                    Originally posted by KTC View Post
                    By mitigation of loss, you're thinking of compensation for breach of contract. This wouldn't be the case here. The agent's fee is X% of the total rent for the tenancy agreed between the landlord and tenant. The landlord is going to be contractually obliged to pay that fee. It's just the landlord is trying to pass it onto the tenant for agreeing to an early termination.



                    Landlord have no duty to mitigate for loss of rent. They can let the tenancy continue until the end and sue for unpaid rent, or they can agree an early termination in which case the terms are whatever's agreed between the landlord and tenant.
                    The landlord is not mitigating loss of rent. They are mitigating the loss of agent's commission. When they decided to re-let, they ended any claim for loss of rent.

                    Comment


                      #11
                      There's no breach of contract, there's no loss to mitigate anywhere.

                      The agent is entitled to £X in commission/fee as a result of the tenancy for the work of finding a tenant, sorting out the contract etc. That is a term in the contract between the landlord and the agent. Either the landlord's paying up front, or the agent deduct it when they collect the rent with the provision that the landlord/tenant is liable to pay the rest if tenancy is terminated early. No one has breach a contract here.
                      I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                      I do not answer questions through private messages which should be posted publicly on the forum.

                      Comment


                        #12
                        If the tenant isn't contracted to pay the commission fee, why are they being charged it at all?

                        It seems to me that:

                        1) a surrender of the tenancy has been accepted, by the act of re-letting;

                        2) any additional payments by the tenant arise from the contract, not the tenancy, as there is no tenancy now;

                        3) the landlord could have mitigated those losses by using the same agent to do the re-letting.

                        Comment


                          #13
                          There's some kind of early termination agreement referenced in the post, so the tenant has (I think) agreed to pay something in exchange for the landlord allowing the tenancy to terminate early.

                          That agreement (assuming it exists) is the issue because the 18 month's rent would be a lot, so any agreement that means the tenant pays less might be OK (regardless of how the compensatory sum was arrived at). Which means there's no need to mitigate anything.

                          If the tenant didn't agree to an early termination "fee" or the agreement was unfair in some way, it might be challengeable.
                          But if it was entered into before the tenancy ended (which the landlord wasn't obliged to accept at all) it doesn't really matter on what basis it was calculated.

                          Which agent let the property is irrelevant, any early termination agreement is between the tenant and the landlord not the landlord's agent (even if they did the actual negotiation).

                          Two things that do bear considering:
                          An unlimited requirement to pay a rental supplement is unlikely to be fair in itself.

                          In reality, the tenant might have been better off moving out and stopping paying rent, because their liability would have ended when the property was re-let, which might have been cheaper.
                          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


                            #14
                            Originally posted by leaseholder64 View Post
                            If the tenant isn't contracted to pay the commission fee, why are they being charged it at all?
                            In OP's case, I think there is a clause in the original tenancy agreement in the case of tenant early termination.

                            But it have an early termination cost: the agent comission for rest of 1,5 year of my contract, which landlord paid to the agency is more than 3200£.
                            Originally posted by leaseholder64 View Post
                            3) the landlord could have mitigated those losses by using the same agent to do the re-letting.
                            Again, you keep talking about mitigation. There's no loss to mitigate here. It's a contractual agreement between the tenant and the landlord in the event that the tenant wish to terminate the agreement early. The tenant have contracted to pay that fee.

                            Your response does bring up what happens in the case the clause wasn't in the original tenancy agreement but separately agreed between the landlord and tenant as a condition for the landlord accepting a surrender. The agreement in such a case would be a contract for surrender separate to the actual act of implied or by deed surrender, and must be in compliance with the Law of Property (Miscellaneous Provisions) Act 1989, which requires in writing incorporating all the terms etc. So a tenant may well have a get out there in a lot of case.
                            I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                            I do not answer questions through private messages which should be posted publicly on the forum.

                            Comment

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