Agent’s Cancellation Charge even though contract has expired?

Reply to the comment left by Julie Ford at 27/12/2023 - 14:51
Thanks Julie for the helpful advice.

Thanks all for your advice and it's been really helpful. You guys are legends in this forum.

Regards,
Kin

Cancellation clause or penalty clause?
1.legitimate purpose behind clause
2.genuine pre estimate of enforcing parties direct loss
3.clause not primary obligation ie not main condition of the agreement that a party is to perform

If cancellation clause does not comply with all above criteria it may be deemed a penalty clause and unenforceable which means any cancellation fee calculated by reference to it is not payable

Sought with legitimate purpose? Was fee sought to keep party locked into agreement indefinitely regardless of performance?

Reply to the comment left by Kizzie at 28/12/2023 - 12:51
Thanks Kizzie.
You made some very valid points here.
The whole purpose here of the Agent is to keep Landlord lock into agreement indefinitely regardless of their preformance while they have failed to perform so many of their terms as stated in the contract.

Thanks for your advice again.

Whether or not the charge is due depends entirely on what you signed up to. Read your contract.

Landlords are often seduced by initial low fees, without realising that there may be subsequent charges. To be fair to the agent they have to make money somehow. As long as it's in the contract then it should be paid.

Returning to ‘liquidated damages’. Used in construction industry contracts allowing parties to agree in advance the amount of damages if a particular contractual obligation is subsequently breached. I’d be thinking of cancellation of HS2.
Kin - this has to be a specific clause agreed in advance written in the contract.
If not in your contract it is an indicator the agent is trying it on and suggests harassment.
In your dispute point to this and ask what specific clause word for word in the contract they allege you breached.

Liquidated damages clauses are not uncommon in contracts whereby the loss can be quantified and agreed in advance.

My experience was ship repairs and the basis of the damages was the cost of hiring a vessel if the agreed delivery date was not met.

Of course there was also a force majeure clause.

@Kin
In the OP, you say that your contract with the agent has expired – presumably it was on a fixed term originally? That is the period that you signed up to for which you are bound to observe the terms.
The fact that you have continued to use the same agents (without a renewal of that contract) may mean that you have a continuing implied contract, but that is a point for them to make - and prove to you - rather than for you to volunteer.
The wording says that they ‘reserve the right’ to charge you the commission up to and including the final day plus £1000 - two different items, which may be considered separately. Commission: presumably you have paid them their monthly amount for the entire duration of the period that they have managed the property for you? If so, where is their loss? Initial set up costs have been amortised plus extra fees have been received after the initial fixed term.
Regarding the £1000, it does not say they WILL charge you, simply that they reserve the right to; it suggests it applies in some, but not all, circumstances and may be discretionary. If they want to press for that additional payment, and as you are required to agree that it is an accurate estimate of the loss they will suffer, ask them to prove how they arrive at that sum. I am guessing that its original purpose was to provide for revenue lost if a landlord withdrew from the contract before the initial period had expired (and before set up costs had been recovered, so arguably justifiable), but that is clearly not the case here. In your circumstances I think that they would have a difficult time justifying any additional payment other than perhaps for a period of notice.
With regard to the deposit, if you’ve got the details of it, you can ask the relevant Deposit provider to transfer the deposit to you.
Finally, are the agents members of a trade body or Ombudsman service you could refer to?

Fyi, I am not a lawyer, the above is just my opinion.

Reply to the comment left by Freda Blogs at 30/12/2023 - 16:51
Thanks Freda for your time and advice.
You made some good points here that since any renewing contract hasn't been signed and tenant's contract has also expired but on monthly rolling contract, therefore this cancellation charges do not really apply here.
Yes the Agent is under The Property Ombudsman. I will take up the case if the Agent is trying to give to make any issue. Thanks for your advice once again.

Regards,
Kin