Early termination of tenancy - Charges/fees?

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    Early termination of tenancy - Charges/fees?

    Hello everyone

    I am tenant in the circumstances that one could easily find oneself in.
    My job is changing and I have to move with my family to a different location.

    My minimum term as per the Tenancy agreement is 8 months. However as I am required to join the new job in a location that is not physically commutable on a daily basis from where I currently live, I decided to serve an early notice to the Landlord/Managing agent.

    I served the Managing agent an official notice via a letter sent by special delivery next day giving 1 month and 12 days notice, timing my end of tenancy to end exactly at three months.

    As part of mitigating the losses of the Landlord, I offered to pay the re-advertising costs for re-letting the property and the unpaid rent + utilities until the Managing agent/Landlord finds a new Tenant to take over.

    The Managing agent came back with a set of new conditions for relieving me from the tenancy. The charges quoted included Re-advertising fees (which I already agreed to pay), check out inventory fees and any unpaid rent+utilities.

    However, the Managing Agent has also quoted me for the Letting commission of the remainder of the 5 months of the minimum term saying that this is to mitigate the Landlords loss.

    Moreover, he has re-advertised and held viewings and found a suitable tenant for 100£ higher rent the same day he re-advertised.

    My understanding is that I as a Tenant have no relation whatsoever to the Letting commission as it is entirely an amount/contract between the agent and the Landlord. To expect me to refund the Landlord seems unfair. The Tenancy agreement does not have any clauses for early termination where this pro-rata calculation is mentioned.

    When I have replied with this reasoning, he has threatened to withdraw the offer of the new Tenancy, cancel his offer and says that there can be no negotiation on the total amount for relieving me. Take it or end up paying the rent for the remainder of the minimum term.

    The problem I have in understanding this is that:
    1. I have been completely reasonable and have valid grounds for early exit. I have been forthcoming in offering payment in terms of meeting my obligations. However, I still think that the Letting commission has got nothing to do with me. Any thoughts?

    2. I have no idea whether the Managing agent has actually spoken to the Landlord and has his agreement to re-let the property. I suspect that he has not had the discussion as he has replied to me within a day and usually he takes time to get things done via the Landlord (Landlord lives in Hongkong). I do accept I have no means of verifying this.

    3. Given that the Agent has conducted viewings and has a suitable tenant ready to move in, who has also paid a holding deposit and given notice at his current address, is he not endangering the new Tenant and putting him at risk of being homeless?

    If I leave as per the date I specified given that I have done what I can to reason it out with the agent, what are the chances of me being considered as being in "rent arrears"?

    Any advise will be helpful.

    #2
    Originally posted by don_espero View Post
    I served the Managing agent an official notice via a letter sent by special delivery next day giving 1 month and 12 days notice, timing my end of tenancy to end exactly at three months.
    Unless the contract contains a break clause, you cannot serve notice with the effect of ending the tenancy before fixed term expiry, so your notice would have no legal effect.

    As part of mitigating the losses of the Landlord, I offered to pay the re-advertising costs for re-letting the property and the unpaid rent + utilities until the Managing agent/Landlord finds a new Tenant to take over.
    Assuming no break clause, what you have done is make an offer to surrender the tenancy. The LL is free to accept or reject it.

    The Managing agent came back with a set of new conditions for relieving me from the tenancy. The charges quoted included Re-advertising fees (which I already agreed to pay), check out inventory fees and any unpaid rent+utilities.

    However, the Managing Agent has also quoted me for the Letting commission of the remainder of the 5 months of the minimum term saying that this is to mitigate the Landlords loss.

    Moreover, he has re-advertised and held viewings and found a suitable tenant for 100£ higher rent the same day he re-advertised.
    The LL is also free to accept the offer to surrender conditional on T paying £X. It doesn't make any material difference what £X is described as. It could simply be a case of LL saying please pay £X and I will agree a surrender.

    My understanding is that I as a Tenant have no relation whatsoever to the Letting commission as it is entirely an amount/contract between the agent and the Landlord.
    Correct, but the agent acts on behalf of the LL.

    To expect me to refund the Landlord seems unfair. The Tenancy agreement does not have any clauses for early termination where this pro-rata calculation is mentioned.
    It doesn't have to. T signs a contract to pay £X rent for a term. If T makes an offer to surrender the tenancy early, LL is free to reject or accept and he may impose financial conditions on that acceptance. T is free to refuse the LL's financial conditions and continue with the tenancy and the liability for rent up to fixed term expiry.

    When I have replied with this reasoning, he has threatened to withdraw the offer of the new Tenancy, cancel his offer and says that there can be no negotiation on the total amount for relieving me. Take it or end up paying the rent for the remainder of the minimum term.
    LL doesn't need to justify why he is asking for £X in exchange for agreeing a surrender. The alternative, if T doesn't want to pay £X, is that T remains liable for rent up to fixed term expiry.

    The problem I have in understanding this is that:
    1. I have been completely reasonable and have valid grounds for early exit. I have been forthcoming in offering payment in terms of meeting my obligations. However, I still think that the Letting commission has got nothing to do with me. Any thoughts?
    Assuming no break clause, you have no 'valid grounds' to end the contract early. You are just making an offer to surrender.
    2. I have no idea whether the Managing agent has actually spoken to the Landlord and has his agreement to re-let the property. I suspect that he has not had the discussion as he has replied to me within a day and usually he takes time to get things done via the Landlord (Landlord lives in Hongkong). I do accept I have no means of verifying this.
    The agent acts on behalf of the LL. It doesn't make any difference from your POV whether the agent is consulting the LL or not.
    3. Given that the Agent has conducted viewings and has a suitable tenant ready to move in, who has also paid a holding deposit and given notice at his current address, is he not endangering the new Tenant and putting him at risk of being homeless?
    Not your problem, and has no bearing on your position.

    If I leave as per the date I specified given that I have done what I can to reason it out with the agent, what are the chances of me being considered as being in "rent arrears"?
    Impossible to tell. The agent/LL will or won't re-let the property. LL has no obligation to mitigate his loss so he would be entitled to do nothing, treat the tenancy as continuing, and claim against you for any rent owing and unpaid. If the property is re-let, however, then that would demonstrate that LL had accepted your offer to surrender, by his actions*, and the tenancy and your liability for rent would end then.

    *Google 'surrender by operation of law'.

    Comment


      #3
      Hello

      Thank you for the detailed replies.

      The Tenancy agreement does have a break clause. The agreement states the below

      "IT is agreed that the Tenant may terminate this Tenancy by giving to the Landlord’s Agent not less than 2 months notice in writing after 6 months from the date of commencement of this Tenancy Agreement and shall up to the date specified in such notice for determination pay the rent and observe and perform the covenants on its part therein reserved and contained and on the date of determination shall yield up to the Landlord vacant possession of his Premises when on the expiration of such notice the Term hereby granted shall cease and the Rent shall be adjusted accordingly but without prejudice to the rights and remedies of either party against the other in respect of any antecedent clause or breach"

      This effectively means a minimum term of 8 months after which I can serve notice as per the AST.

      Comment


        #4
        Originally posted by don_espero View Post
        The Tenancy agreement does have a break clause. The agreement states the below

        "IT is agreed that the Tenant may terminate this Tenancy by giving to the Landlord’s Agent not less than 2 months notice in writing after 6 months from the date of commencement of this Tenancy Agreement and shall up to the date specified in such notice for determination pay the rent and observe and perform the covenants on its part therein reserved and contained and on the date of determination shall yield up to the Landlord vacant possession of his Premises when on the expiration of such notice the Term hereby granted shall cease and the Rent shall be adjusted accordingly but without prejudice to the rights and remedies of either party against the other in respect of any antecedent clause or breach"

        This effectively means a minimum term of 8 months after which I can serve notice as per the AST.
        Yes, it says you may serve notice to end the tenancy by giving two months notice after six months into the tenancy. However, that is apparently not what you have done. You said

        Originally posted by don_espero View Post
        I served the Managing agent an official notice via a letter sent by special delivery next day giving 1 month and 12 days notice, timing my end of tenancy to end exactly at three months.
        ...which appears to indicate that you served less than two months notice and did it well before the six month point.

        Comment


          #5
          Many thanks again for the prompt answer.

          I completely agree that I did not provide the required notice. The circumstances were such that I provided a notice as soon as I knew of the location change. Do circumstances not count at all?

          Can the Managing agent "unreasonably" reject the new Tenancy that he has obtained via re-advertising after agreeing the viewing times with me and having atleast 3 prospective tenants view the property and make offers? Does that not imply that he has agreed to re-let the property?

          Moreover he emailed to say that he will start the new Tenancy arrangements only if I agree to the early exit conditions imposed. How can the new Tenancy be linked to my financial settlements? Isn't that a separate contract by itself?

          I am contemplating negotiating for a partial sum e.g. 2 months of "letting commission" instead of the 5 months he is demanding.

          Is it reasonable to ask for proof that he has agreed to relieve me of the tenancy and
          that the money is refunded to the Landlord instead of him pocketing it?

          Comment


            #6
            Originally posted by don_espero View Post
            Many thanks again for the prompt answer.

            I completely agree that I did not provide the required notice. The circumstances were such that I provided a notice as soon as I knew of the location change. Do circumstances not count at all?
            No.
            Can the Managing agent "unreasonably" reject the new Tenancy that he has obtained via re-advertising after agreeing the viewing times with me and having atleast 3 prospective tenants view the property and make offers?
            Yes, because the LL has no obligation to find a replacement tenant, so he can reject any prospective tenant, however suitable the prospective T may be. The agent acts on behalf of the LL.

            Moreover he emailed to say that he will start the new Tenancy arrangements only if I agree to the early exit conditions imposed. How can the new Tenancy be linked to my financial settlements? Isn't that a separate contract by itself?
            He is saying that he will agree an early surrender if you agree to pay £X. If you agree to pay £X, and a surrender is formally agreed, then he will be free to proceed with a new tenancy. If you don't agree, then your tenancy will remain in place and he will not be free to re-let the property.

            I am contemplating negotiating for a partial sum e.g. 2 months of "letting commission" instead of the 5 months he is demanding.
            You are free to offer whatever sum you like. LL/agent is free to reject it and to treat the tenancy as continuing.

            Is it reasonable to ask for proof that he has agreed to relieve me of the tenancy and that the money is refunded to the Landlord instead of him pocketing it?
            If you agree an early surrender with the agent, it is perfectly reasonable to ask that this is executed formally in writing, as a Deed of Surrender. It is not reasonable to insist on proof of where the money you pay is ending up; that's entirely between the agent and the LL.

            Comment


              #7
              Circumstances do count!

              The circumstances here are that you signed to rent the property for a certain time and pay rent for that whole time. Now you are trying the change the agreement to suit yourself.

              Whilst no-one has a crystal ball to be able to know how your lives with change during the period of the tenancy, you have taken on the obligation to rent for this period, so are bound by it. Unless you can make the offer to surrender more attractive to the LL/LA (probably by agreeing to their counter offer), then you could feasibly be charged for the whole tenancy!

              Comment


                #8
                I quite appreciate how unreasonable & unfair this all seems.

                However, if you wanted to stay & landlord arrived, knocked on your door & announced "my circumstances have changed you must leave in 1 month and 12 days" would you have thought that reasonable ??
                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


                  #9
                  Will your new company not pay relocation costs for you?
                  Disclaimer:

                  The above represents my own opinion, derived from personal knowledge and should not be relied upon as definitive or accurate advice. It is offered free of charge and may contain errors or omissions or be an inaccurate opinion of the law. I accept no liability for any loss or damage suffered as a result of relying on the above.

                  Comment


                    #10
                    Not really, my project is moving, the company is still the same. They are relocating people as the locations around UK are being reduced.

                    Comment


                      #11
                      I can still think this as reasonable if the grounds are valid but considering what the Agent is trying to charge me for in terms of letting commission that has nothing to do with me as a Tenant ... In my eyes, it is like turning to the Agent in the hypothetical scenario that you have mentioned, and asking for refunding my Gym fees loss because I will be breaking the the 1 year contract I have with the Gym and have to keep paying them till the term of my contract..

                      Comment

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