Can I terminate landlord agreement without paying fees?

Can I terminate landlord agreement without paying fees?

9:10 AM, 5th August 2024, About 3 months ago 10

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Hello, I have a portfolio of eight rental properties in the Kent area and they are managed by a local letting agent on a full management agreement.

This agent took over from a previous agent, who had managed my properties for 20 years. During this time I did not sign a contract or receive any terms or conditions.

I have become unhappy with this agent, due to their poor service and lack of communication. Therefore, I wish to terminate the landlord agreement.

In their terms and conditions there are exit fees of 1.5 months’ rent plus VAT for each property.

One of the areas that I feel could be a breach of contract, is that they have not notified me two months before the expiry of a Tenancy Agreement.

From their terms and conditions:

4.4 Renewals: Two months before the end of the Tenancy, the Agent will find out whether the Landlord and the Tenant want the tenancy to continue, this may be earlier for student properties. If the tenancy is to be renewed, the Agent will prepare a new Assured Short hold Tenancy Agreement carryout new referencing and guarantor agreements in line with the Landlord’s instructions.

According to the terms and conditions, I should have received communication and my agreement if required for the tenancy to continue, or increase in rents two months before the Tenancy Agreements expired.

Their reply:

The properties that have expired were on my to do list to contact you about. As I previously mentioned we work slightly different to the previous Agent. We contact every landlord yearly about tenancies expiring regarding new agreements/rent increases. This does mean sometimes agreements expire and tenants will fall onto periodic tenancies for a short period. But it also means rent increases/new agreements happen with every property without fail.

Also, in their latest reply they stated they have now changed procedures incorporating a new software, which will notify them 30 days before the AST Expires. (In the current T&C it states two months before the AST expires.) Also, carrying out rent increases/new agreements at any point throughout the year, to 30 days before expiry.

This would indicate a change in the terms and conditions for the landlord.

Section 5.4 – The Agent retains the right to change the terms of this Agreement by giving the Landlord two months’ written notice of the change and the date the change will become effective.

I have not received two months’ notice nor a date the change will come into effect.

Therefore, can I terminate the landlord agreement without paying any fees? Or on any other matter?

Thank you very much,

Martin


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Comments

Graham Bowcock

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14:31 PM, 5th August 2024, About 3 months ago

Hi Martin

Have you signed the terms with the new agent? You mention that the predecessor had no terms and then reference the new agent's terms; are you working to their terms?

In terms of the lack of notice, have you incurred a loss? Even if you weren't told two months before the end of a tenancy, you can still serve two months notice to end it. In actual fact they do not need to do a new tenancy at all (that sounds like fee generation).

Are there other issue of poor communication?

Their management system sounds plain wrong if they can't better define notice periods on it.

Do they have exiot fees in their agreement? Is this what you are worried about?

I suggest you speak to them with your concerns. If they're causng you a problem then you should probably put everything in writing and tell them you've grounds for leaving.

As often happens on this site, you have only posted extracts from the agreement. It's difficult for anyone to give you proper advice from what you have said.

Judith Wordsworth

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14:56 PM, 5th August 2024, About 3 months ago

Your agent may have had an agreement with the previous agent to take the "goodwill" associated with the agency ie current landlords and tenants contracts and agreements.

By not negotiating new Ts&Cs and continuing with their management you have entered into a contract by performance.

You say "One of the areas that I feel could be a breach of contract, is that they have not notified me two months before the expiry of a Tenancy Agreement." Don't think a Court would wear this as a breach of contract. And likely very expensive to find out

DPT

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15:29 PM, 5th August 2024, About 3 months ago

If the new agent is a different company, then there wouldn't necessarily be a automatic transfer of customer liability. You might need a solicitor to check for you though.

Paddy O'Dawes

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16:48 PM, 5th August 2024, About 3 months ago

On the face of it I agree with Judith. However you say they have 6 of your properties in Kent and they want 1.5x6 properties monthly rent, which I would suggest is a significant sum. Based on that an hour with a Solicitor specialising in contract law seems like a wise investment. I also think the period of time you have continued under the new business will be significant regarding the veracity of a claim for breach based on changes of terms at the commencement by the new business.

kame401@hotmail.com

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17:01 PM, 5th August 2024, About 3 months ago

Reply to the comment left by DPT at 05/08/2024 - 15:29
It is a new company with a different Principal. I did try my Solicitors but he is on holiday and I tried a couple of other firm of Solicitors but they never got back to me!

kame401@hotmail.com

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17:02 PM, 5th August 2024, About 3 months ago

Reply to the comment left by Judith Wordsworth at 05/08/2024 - 14:56
Two of the properties have one year tenancies, which have expired and now moved onto periodic tenancies. There has been no increase in rent, so there is financial loss.
Also, in one of their emails they stated they will contact tenants one month before the end of the AST. This is different from the two months in the T&C

kame401@hotmail.com

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17:02 PM, 5th August 2024, About 3 months ago

Reply to the comment left by Graham Bowcock at 05/08/2024 - 14:31
I have not signed any contract or t&c with the new agent.
Two of the properties have one year tenancies, which have expired and now moved onto periodic tenancies. There has been no increase in rent, so there is financial loss. Exit fees 1.5 rent per property
The first six months the service and communication was poor. After one of office worker left things have improved.

PH

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17:12 PM, 5th August 2024, About 3 months ago

Reply to the comment left by at 05/08/2024 - 17:02
Sorry, if you've not signed any contract or t&C's with the new agent how are you under contract with them ? Confused

Julie Ford

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9:39 AM, 6th August 2024, About 3 months ago

Hi, if you have not signed the new agents specific terms of business then you cannot be bound by any specific terms
The law would take over to fill the gaps and it would be open to negotiation and consumer protect regs in regards to unfair terms

1.5 months rent is not unfair or unreasonable, the issue here is that is a multiple of 6

Your options are:
Negotiate with the agent in an agreeable release fee

Or walk away and see if they take you to court- if they do then it will be up to a judge to decide if the exit fee is reasonable, based on OFT c foxtons I’d say it is
But the question is whether it’s binding given you didn’t sign specific terms

Yellard

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17:32 PM, 6th August 2024, About 3 months ago

Reply to the comment left by Judith Wordsworth at 05/08/2024 - 14:56
I am very happy with my current agent on one of my properties. Their contract with me entitiles them to a % of rent into perpetuity if the current renews even that I sack the agent. . I want therefore not to renew current tenant's contract on expiry. But will I be stuck paying the current agent forever if section 21 is immediately abolished and I don't want to sell the property?

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