Estate Agents Pay Buy to Let Landlord Compensation

14
Jul/090

Estate Agents Pay Buy to Let Landlord Compensation

Foxtons Estate Agents in London

Large capital-based solicitors, Foxtons, were told by High Court Judge Mr. Justice Mann that many of the charges they imposed on their landlords were unfair. This, after the Office of Fair Trading (OFT) had decided that the charges broke some of the consumer regulations back in 2008. The OFT then asked the High Court to uphold their decision on the basis that the Foxtons small print included clauses which could be considered a “trap”.

The three main clauses that Mr. Justice Mann said were unfair were:

that Foxtons should be paid full commission for selling the property to the tenant, regardless of whether or not it was them who placed the tenant in the property

that Foxtons estate agents could continue to demand “renewal” commission from a landlord if a tenant stayed on past the initial tenancy period whether they were involved in the extended stay or not

that, even when Foxtons had sold a property on behalf of the buy-to-let landlord, they continued to request commission payments from the landlord for the remainder of the agreed period

The Office of Fair Trading, obviously delighted with the decision, exclaimed: “This ruling sends out a clear and unambiguous message that businesses offering services need to ensure unexpected or surprising terms are not hidden away in small print. Contracts need to be written in clear and straightforward language with important provisions, particularly those which may disadvantage consumers as in this case, given prominence and actively brought to people’s attention.”

The complaint made against Foxtons were largely down to a general protest from landlords about the way in which they were being treated by their agents. They recognised that the OFT had powers to act under the 1999 Unfair Terms in Consumer Contract regulations and Foxtons were disciplined.

When ruling, the judge said landlords would be “astonished” to find they had to pay Foxtons commission for the sale of a property, even if the agency had played no part in the deal. It is believed this problem could be a lot more widespread than initially though and could effect hundreds of thousands of buy to let landlords throughout the UK.

If you are reading this and you have any buy to let properties and feel you have been misled or had unfair charges brought to you, you may want to contact Buy to Let Compensation who can help you make a claim.