Unfair terms in consumer contracts: OFT v. Foxtons

[pcwilkins]

http://news.bbc.co.uk/1/hi/business/7264451.stm

Note:

1) The OFT has said the terms are unfair
2) Foxtons continues to use them
3) The terms are still legally binding on those who agree to them, even though OFT says they're unfair?
4) But if OFT get the injunction they're looking for, then Foxtons won't be allowed to use the terms.

If a term became non-legally-binding the minute the OFT ruled it unfair, why would the OFT be seeking an injunction?

I seem to remember a post a few days ago complaining that LL had signed to agree to pay LA £X if T (that LA found) renewed, even if LA wasn't managing property. I wonder if that was Foxtons?

Peter

[jeffrey]

3. Yes. The terms are inoperative only if a competent Court so orders.
The OFT does not have competence to order any such thing, no matter how much it huffs and puffs.

[Paul_f]

Thought you all might be interested in this concerning commission for "renewals" of tenancy agreements after the end of the fixed term where the tenant stays in situ without any intervention by the agent.

It appears that what goes around comes around.

I've just picked this up from a press release:-

The OFT has issued High Court proceedings against Foxtons Limited seeking a declaration on the application of the Unfair Terms in Consumer Contract Regulations 1999 (UTCCRs) to certain terms in Foxtons’ lettings agreements with landlords. The OFT is also seeking an injunction against Foxtons preventing it from using the terms.
The action taken by the OFT is in response to consumer complaints. If successful in this case the OFT intends to enforce compliance with the law, as declared by the Court, throughout the letting industry wherever similar terms are being used.
The terms to which the OFT objects in Foxtons’ letting agreements can potentially require landlords to pay Foxtons substantial sums in commission, where a tenant continues to occupy the landlord’s property after the initial fixed period of the tenancy has expired – even if Foxtons plays no part in persuading the tenant to stay, and no longer collects the rent or manages the property. Foxtons’ terms can also require the landlord to pay these sums after the landlord has sold the property. The terms also demand commission where the landlord sells the property to the tenant, even where Foxtons has played no part in negotiating that sale.
Foxtons contends that its agreements with landlords are not unfair and continues to use these terms, and accordingly, the OFT has issued proceedings so the courts can decide the matter.
NOTES

1. The OFT is seeking an enforcement order against Foxtons Limited under the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCRs).

2. The UTCCRs apply to standard contract terms with consumers. The UTCCRs protect consumers against unfair standard terms in contracts they make with traders. The OFT, and certain other qualifying bodies (such as local authority trading standards, national regulatory bodies, and Which?) can take legal action to prevent the use of potentially unfair terms. A term is likely to be considered unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations under the contract, to the detriment of consumers. The regulations say that a consumer is not bound by a standard term in a contract with a trader if that term is unfair. Ultimately, only a court can decide whether a term is unfair.

3. It is estimated in the lettings industry that there are at least 15,000 letting agency businesses in the UK, including a number of national and multi-national companies in addition to many smaller businesses.


http://www.oft.gov.uk


PUBLIC enquiries: 0845 7224499 enquiries@oft.gov.uk
OFT reports and consumer information leaflets are available free from:
OFT, PO Box 366, Hayes UB3 1XB 0800 389 3158 oft@ecgroup.uk.com

[lorenzo]

I'm having a very confused day today. I can understand ASTs being viewed as a consumer contract and subject to unfair terms legislation.

But we are speaking here of contracts between LL & LA. No "consumer" is actually involved, the contract being between two business interests.

How can this be dealt with under The Unfair Terms in Consumer Contracts Regulations 1999?

Is there other applicable legislation that the OFT is using?

I agree it's unfair, but a LL is on an equal negotiating stance with the LA and should be able to negotiate this clause or move on.

[Colincbayley]

Ground hog day is starting to come to mind! :(

[lorenzo]

Groundhogs rule, OK!

http://www.marketingneophyte.com/uploads/groundhog.bmp

[Colincbayley]

Now you are just getting weird !!!!!!!!

[lorenzo]

Yeah, but how awful would it be to be one of the homogeneous masses?

[BlueBox]

this was also mentioned on Watchdog last night

[Bel]

About time something happened about this.

[tsu3000]

About time too!

[jeffrey]

The OFT has issued High Court proceedings against Foxtons Limited seeking a declaration on the application of the Unfair Terms in Consumer Contract Regulations 1999 (UTCCRs) to certain terms in Foxtons’ lettings agreements* with landlords. The OFT is also seeking an injunction against Foxtons preventing it from using the terms...

The terms to which the OFT objects in Foxtons’ letting agreements* can potentially require landlords to pay Foxtons substantial sums in commission, where a tenant continues to occupy the landlord’s property after the initial fixed period of the tenancy has expired – even if Foxtons plays no part in persuading the tenant to stay, and no longer collects the rent or manages the property. Foxtons’ terms can also require the landlord to pay these sums after the landlord has sold the property. The terms also demand commission where the landlord sells the property to the tenant, even where Foxtons has played no part in negotiating that sale.
Foxtons contends that its agreements with landlords are not unfair and continues to use these terms, and accordingly, the OFT has issued proceedings so the courts can decide the matter.

NOTE (to my inserted asterisks):
It's not the Letting Agreement (between L and T) that is in question.
The case will therefore have no impact on so-called unfair terms in an AST.
In fact, it will revolve around the Agency Agreement (between L and Agent).

[jeffrey]

Yeah, but how awful would it be to be one of the homogeneous masses?
Is that a new kind of Roman Catholic service?

[Colincbayley]

Is that a new kind of Roman Catholic service?

I thought it meant 'gay ground hogs' Oh well, you live and learn.

[jeffrey]

Oh well, you live and learn.
No- some just seem to live. Read several "Hello, I'm a new landlord" posts for details...

[Colincbayley]

No- some just seem to live. Read several "Hello, I'm a new landlord" posts for details...

Very true.:rolleyes:

[jeffrey]

Very true.:rolleyes:
"Very true"? Is that like:
a. extremely full;
b. almost alive;
c. fairly perfect; and
d. partially whole?

[Paul_f]

I used the OFT's wording - they compiled the press release so I think it doesn't require comment. I've not amended it in any way.

[agent46]

I got a good debate going on this issue on housepricecrash.co.uk.

http://www.housepricecrash.co.uk/forum/index.php?showtopic=69988

[agent46]

The issue that the HPC peeps totally miss is the ruling is against renewal fees for let-only service.

No-one has an issue with a LA charging an ongoing commission or any major issue (although unnecessary) if renewing tenancies every six months (and pocketing a new sign up fee). The issue is with let only services and charging if the tenant stays on, even if no extra work was done by the LA. That is what the OFT case is about, from memory.

They all seem to have missed that on HPC. I wonder how many landlords are on there?

With respect, I think you need to re-read the HPC thread as a great deal of the discussion does in fact centre around the issues involved when a LA has a "one night stand" type of arrangement with the LL, and then does not do any further work, but continues to levy fees. I know this is the case, as I started the thread and posted numerous rebuttals to arguments raised against my points.

Did you read all the thread, or just the first page?

[silvercar]

Anyone know when a ruling is likely? My tenant wants to renew in July, if I don't have to pay the original letting agent a renewal fee I will be very happy.

Is it worth letting the LA know I am aware of this investigation and offering a "no further fees" deal in return for me not trying to claim back the renewal fee I paid last year?

[Paul_f]

Just an update on this. Apparently other firms who support Foxtons have got together to fight the OFT action and if they lose they will appeal and take it to the European Court if necessary.

The basis of their agrument is that suppose you rent a telly, even though you may only have a 12 months contract to do so, if you keep it beyond the intitial period then you still pay a monthly rental on which the supplier still takes his cut! The only thing is with a let only agreement the contract ends when the tenant takes up occupation so how would an agent justify charging a landlord when a tenant remains in occupation beyond the fixed term when no contract between the agent and landlord exists anymore? There is surely nothing wrong in the tenant doing a deal with the landlord directly thereafter so why are they fighting the OFT? It's a no-brainer as far as I can see, and morally Foxtons should by rights lose the action. It will of course take more than few months to sort out and I expect it might be 2010 before it's resolved

[P.Pilcher]

This policy of some agents to charge self managing landlords tenancy renewal fees for doing nothing seems to be very lucrative if they are clubbing together to fight and appeal what, IMHO, should be an open and shut case.
I hope the legal profession make a mint out of them! Agent 46, Jeffrey & co, I hope you smell fat fees in that direction!!

P.P.

[ashhorner]

Hi,

This is my first post after finding this thread doing a google search. My tenants have just renewed directly with me and I think the letting agent may come after me for further commission as this was a term in the contract.

Does anyone know the status of the court case with the OFT v Foxtons? I have written to the OFT to find out.

Has anyone successfully challenged these terms with their letting agents?

Thanks

[dhor]

Does anyone have any news on the progress of the case being brought by the OFT against Foxtons ?
Am on my second renewal and am faced with having to pay over 1000 quid for a non managed service to my LA in London

[jeffrey]

Does anyone have any news on the progress of the case being brought by the OFT against Foxtons ?
Am on my second renewal and am faced with having to pay over 1000 quid for a non managed service to my LA in London

There are at least two cases, both covered by LZ threads. Try macro search for "FOXTONS".

[yaflaminmongrels]

Any updates on this? I remember reading an article on TimesOnline about this, but it wasn't very clear...is this affecting non-management/Let Only service fees only, or management fees too? For example, if I have a managed property, and after the fixed term contract expires, I could give my Agent notice, and keep the same tenant without incurring charges?

[agent46]

It's a no-brainer as far as I can see and morally Foxtons should by rights lose the action.

Why?

Morally speaking, I think that people who sign a contract should be held to its terms. I also believe they should not start whinging like 3 year olds when they find they can't wriggle out of the consequences of their agreements. That is just my opinion on the matter.

However, the dispute between Foxtons and the OFT is about law and not morals, so regardless of whether you, I or anyone else thinks Foxons or the aggrieved landlords or the OFT are immoral, it will be legal principles that determine the matter. Therefore, it is not, by any means, a "no brainer" and in fact, very strong legal arguments indeed can be mounted to support Foxtons' position.

[Rent-Manager]

Hi there,
There is a quick update on the OFt vs Foxtons case here

http://www.rentmanagement.co.uk/articles/750/1/OFT-vs-Foxtons-Case-Update/Page1.html

Regards

Sean

[Hoey]

JUst want to let you guys know that it was my Collegue together with the National Landlords Association that has brought this "agent renewal fees" case to the OFT.

Being an ex agent myself I fully understand lanlord concerns, but at the time agents such as myself are hand tied when head office make such decisions. That is why I have group together with some fellow landlords and set up an Internet site called Heathrow Lettings(Soon to be 121 Lettings) to give lanlords a fairer platform to work from. We also have a tenant property matching service at a very low cost no frills service. NO RENEWAL FEES , NEW QUIBBLE PRO RATA FEE AFTER FIRST 6 MONTHS. pLEASE CHECK US OUT. We have basically taken out all the usual gripes about LA and offer a friendlier consumer friendly service.

www.heathrowlettings.com

As soon as I have further news re: Foxton V OFT i will post on this forum.

Happy renting

[agent46]

Being an ex agent myself I fully understand lanlord concerns, ...... to give lanlords a fairer platform to work from.

You might impress landlords a little better if you actually spelt the word "landlord" correctly.

Spam Spam Spam Spam, Spam Spam Spam Spam

[jeffrey]

You might impress landlords a little better if you actually spelt the word "landlord" correctly.

(and 'colleague')

Also 'grouped', not 'group'.

And who wants a 'New Quibble pro rata fee'?

[agent46]

(and 'colleague')

Also 'grouped', not 'group'.

And who wants a 'New Quibble pro rata fee'?

Yep, I spotted all of the above, and also the words written in mixed case. However, I decided not to mention them because I need to be on my best behaviour. :o

[jeffrey]

I need to be on my best behaviour.
All of us do. Why should anyone ever not be?

[Hoey]

OK guys , I apologise for all the mistakes on my earlier post. I was typing out in the sun and it was indeed a hot day today. Our services are very genuine and consumer friendly.

Just thought I'd help our website with a plug on this forum. I am sure there are landlords who would appreciate an alternative to the usual high street agent.

Keep at it guys, this forum makes good reading.:o

[Paul_f]

If you want to read the transcript from the case which has still not been ruled upon is:

http://www.bailii.org/ew/cases/EWHC/Ch/2008/1662.html

[Esio Trot]

If you want to read the transcript from the case which has still not been ruled upon is:

http://www.bailii.org/ew/cases/EWHC/Ch/2008/1662.html

Quite a good read - not that I understood it all :rolleyes:

Much would seem to hinge on what is the actual legal definition of "consumer", and how inclusive this term might be. Unless I missed it, this did not seem to be discussed.

What I mean is that a consumer in the normal sense (well, how I see it, at any rate) is an individual buying goods and services from a business, and not a business to business transaction.

Mention is made in the transcript above of a "landlord consumer". I wonder if this might just refer to a landlord with one or two properties. But what if the landlord had ten properties, or one hundred plus? What if the landlord was a body corporate, and not a individual - would a company still be regarded as a consumer?

[jeffrey]

What if the landlord was a body corporate, and not a individual - would a company still be regarded as a consumer?
No. Regulation 3(1):
"consumer" means any natural person who, in contracts covered by these Regulations, is acting for purposes which are outside his trade business or profession.
Here, 'natural person' is eurospeak for 'individual'. Although a company is a person for legal purposes, it is obviously not a 'consumer' so far as the Rgs. are concerned.

[Paul_f]

The main point about the case is that the OFT was that individual landlords did not want their names disclosed therefore the case is being looked at by the judge as a collective rather than an individual action. This means that there are generalisations rather than specifics being considered and possibly makes the OFT case a little weaker, but we shall see. I'm all in support of the OFT but I understand Foxtons will appeal if they lose.

[firlandsfarm]

OK, as this is my first post maybe I should make it clear ... I'm not the OFT nor am I Foxtons, I'm just an average kind of private landlord. For reasons I will not bore you with here I terminated my contract with my letting agents (Kinleigh, Folkard and Hayward of Wimbledon, South London) in March (... and yes, I have sometimes mispronounced the middle name! :D ) but they are pursuing me for their 11% on the renewal of the tenancy which I am refusing to pay as we have ended our business relationship. They have resorted to the Small Claims Court so I am on the fast track of the learning how to defend myself.

My plea to the forum members is this ... I am aware of the Peter Batty case in North London and the Fisks case in Essex but are forum members aware of any other cases that have actually gone to court and either been adjourned or proceeded with? (The longer the list of adjourned cases the greater my chances of an adjournment.) If not is there a Court website where I can reference other cases and research what is happening elsewhere.

Also, in case I have to go all the way and an adjournment is not granted does anyone have any information on the OFT case. I am particularly looking for a legal explanation of their case in a form that I might understand or put to the judge. The OFT will not help me as they see it as giving legal advice which they are not allowed to do (also they probably don't want an amateur buffoon like me destroying their case before they have had the chance to use it!).

Any input gratefully received.


Many thanks ... Farmer

[Lawcruncher]

Much will depend on the precise wording of the agency agrement. What do the relevant clauses say?

I am not sure the law is clear on this type of problem since these automatic renewal fees are something comparatively new.

[mind the gap]

If all else fails, you could always plead insanity (at the time you signed their contract). That you signed it, agreeing to pay out a ridiculous sum for no service, may well be sufficient evidence!

Seriously, good luck in your quest. I wish you every success.

[Paul_f]

The OFT v Foxtons case has a problem in that the OFT cannot get any landlords who have made a complaint to their local TSO to stand up and be counted as they don't want to be named presumably.

As you are going to court I would be using the defence that the agents are actually doing nothing for their perceived fee; whether it convinces the judge I don't know but you might want to engage a specialist solicitor to plead your case as you will stand a much better chance of success if you do.

[Christof]

Sadly they have you by the shhort and curlies. You will have signed a contract to them agreeing to pay 11% for the "term that the tenant remains in occupation". They will argue that they have found you a tenant who wants to stay long term which benefits you with no vacant period etc. I used to work for a big london agency and saw many people lose this. In fact I never saw anyone win once the signed "terms and conditions" were revealed. Sorry.

[Esio Trot]

As you are going to court I would be using the defence that the agents are actually doing nothing for their perceived fee; whether it convinces the judge I don't know but you might want to engage a specialist solicitor to plead your case as you will stand a much better chance of success if you do.
Before using this as a defence, it might be worth asking the court to stay this case pending the outcome of the OFT/Foxton case.

[Paul_f]

Update from OFT v Foxtons Case - Court of Appeal 2 April 2009

The Office of Fair Trading won an important argument against Foxtons in its landmark test case, where it is trying to prevent the practice of letting agents charging renewal fees.

The full case will be heard in the High Court later this month, with up to three days set aside in the week beginning April 27.

The final result will have huge implications for letting agents, who charge landlords when tenants renew their tenancies.

If Foxtons lose the case, the ruling will impact financially on not just Foxtons but other agents who charge renewals. The High Court case will set the precedent as to the legality of renewal fees.

The bigger question is, if Foxtons lose, what will happen to historically charged renewal fees?

Some agents have already tried to bring cases at county court, pursuing payment from landlords who have declined to pay renewal fees. The agents have been told that these cases must await the outcome of the Foxtons decision.

Lawyers have already raised the prospect that, if Foxtons lose, then landlords who had paid renewal fees going back six years might reclaim the amounts.

All this has yet to be decided but the OFT won, on appeal, a preliminary argument that had earlier been won by Foxtons.

Foxtons had previously argued that if the court ruled that renewals fees are unfair, this should not affect current contracts whose terms and conditions include the right to charge renewal fees. Foxtons said that the ruling should affect only future tenancy agreements – in other words, those made after the court delivered its verdict.

Originally, the High Court accepted Foxtons’ arguments.

But the Court of Appeal overturned the High Court ruling.

The Appeal Court said that the Unfair Terms in Consumer Contract Regulations, on which the OFT is basing its case for seeking an injunction, are there to protect consumers.

The judgement said that “traders should not have the freedom to pursue existing customers without restriction, in correspondence or by litigation, in order to enforce contractual terms that have been found to be unfair”.

It means that Foxtons, and, because this is a test case which will set a precedent, other agents, will not be able to enforce renewal fees if Foxtons lose.

The full High Court hearing later this month will hinge on the fairness – or otherwise – of the terms and conditions in Foxtons’ contracts.

These terms, on which the OFT has sought an injunction, “can potentially require landlords to pay Foxtons substantial sums in commission, where a tenant continues to occupy the landlord’s property after the initial fixed period of the tenancy has expired when Foxtons plays no part in persuading the tenant to stay, and no longer collects the rent or manages the property,” said the OFT in a statement.

The OFT has also objected to Foxtons’ terms that require a landlord to pay these sums after they have sold the property. Foxtons contends that such terms with landlords are not unfair.

The OFT originally launched its action in February 2008. The Court of Appeal ruling followed the OFT’s appeal against a decision in July 2008.

The case has been a major talking point among letting agents, many of whom argued that courts cannot take issue with clear contracts entered into by both parties. However, the OFT says that under the Unfair Terms in Consumer Contract Regulations, a consumer is not bound by a standard term in a contract if that term is unfair, and that only a court can decide whether a term is unfair.

[jeffrey]

However, the OFT says that under the Unfair Terms in Consumer Contract Regulations, a consumer is not bound by a standard term in a contract if that term is unfair, and that only a court can decide whether a term is unfair.
But remember that the Regulations apply only to standard terms. They do not apply to terms:
a. negotiated by the parties;
b. for an individual transaction.

[grapes]

Hi there guys,

I know there was a hearing at the High Court regarding the OFT vs Foxtons case last week.

I was wondering if anyone knew the outcome? If the outcome has yet to be formalised when can we expect to hear?

Cheers

[Moderator1]

grapes: Your post has been moved to a consolidated thread bringing-together previous posts on this topic.

[attilathelandlord]

I see Foxtons have lost their case re renewal fees. No doubt they'll appeal though.

http://news.bbc.co.uk/1/hi/business/8144161.stm

[600600]

No precedent set yet

[jeffrey]

This is the important bit (but I'm not sure what the asterisked line was supposed to mean!)

The clauses which Mr Justice Mann agreed were unfair said that Foxtons could:
• continue to demand "renewal" commission from a landlord if a tenant stayed on past the initial tenancy period - even if the agency had played no further part in arranging or managing the extended tenancy
• force the landlord to continue paying commission to the agency, even after Foxtons had sold the property*
• be paid full commission for selling the property to the tenant, regardless of whether or not it had had a hand in the sale.

[scribbler]

Will this mean that landlords who have 'unfair' contracts will be able to take action to reclaim fees already paid?

[attilathelandlord]

Earlier ruling says decision won't be retrospective

[David Lawrenson]

The decision must leave a lot of letting agents a bit worried as they can surely expect the claims for repayment to roll in from now.
But you’ll have to make your claim first – these letting agents ain’t going to rush to send you a cheque - and I’m guessing many letting agents won’t pay up too easily either. (I imagine it will help if you have copies of the documents you had when you signed up to a contract)
Its possible that other letting agents will be pushed over the edge by this and go out of business (also taking deposits with them of those landlords who trusted the agent to lodge deposits in one of the tenancy deposit schemes)
Why did letting agencies do renewal fees for so long?
Well, perhaps simply because they could.
And in some cases they also did it because a few landlords are possibly too mean to pay a decent up front fee for an agent’s service. I know this because have on occasion looked after properties for people overseas and I was sometimes astounded by a few landlords’ tightness.
I can well imagine that these were the type of people who would argue over paying a decent rate for an agent to find them a tenant.
Perhaps that was the incentive to some letting agents to go sneaky and opt to charge these repeat renewal fees (having first hidden them deep in a contract) that have now been outlawed.
For some it was the only way they could make a living (though in some of the big London letting agents case it was probably just down to a rapacious desire to squeeze every buck possible out of amateur landlords who were too much is a hurry to read the small print.)
As a result of this decision, I'd expect up-front agency fees for finding tenant to go up and more landlords to opt let direct using the various portals.
Its worth saying that the impression I have had from own experience as a landords is that charging renewal fees and other sneaky fees was not practiced by all letting agents, of course.
Many agents are very straight and did not do it - charging a one off fee.
Outside London and the South East the practice also seems quite rare - with most agents only charging a flat rate one-off fee to find a tenant.
David Lawrenson
Topic Expert
www.LettingFocus.com

[Moderator1]

Several similar threads about the case have been merged here.

[agent46]

Three points need to be made before everyone gets carried away:

(1) On my reading of the press releases, renewal fees have not been declared unfair in principle, merely unfair in the manner in which Foxtons hid them away in the small print (see eg; "The judge held that such important terms must be flagged prominently not just in the contract, but also in any sales literature and processes." http://www.oft.gov.uk/news/press/2009/83-09). We should wait for the judgement to be published.

(2) This decision is not binding authority.

(3) Foxtons will almost certainly appeal, and this may involve making a reference to the European Court of Justice. Potentially, this case has a long way to run yet.

[600600]

The majority of agents I have spoken to have said after the initial introduction fee they would charge as it was the norm and they could. Whether the Landlord negotiated a better rate is not the point, it is expected especially when they have many properties.

Charging is fair if the agent is actually doing something for the fee.

Will be interesting to see how things turn out.

[johnboy]

I know this is going off slightly at a tangent but didnt financial advisers who sold endowment policies get paid commission for the whole 20/25 year period the policy was running even though they werent doing anything for it other than set it up at the start.

[grapes]

This is a very interesting ruling. I have paid Foxtons well over 10k in renewal fees over the last 5 years, they are going to be in deep financial trouble if people are able reclaim these fees. Does anyone have any take on what the ruling means on retrospective fees? This recent Times article seems to suggest that people are going to be able to claim..

http://business.timesonline.co.uk/tol/business/industry_sectors/article6685503.ece

[Poppy]

The one agency that was charging me perpetual fees for doing fcuk all, has since April this year seemingly quietly stopped sending invoices. I'm guessing that they sensed that the Foxtons case was the end of the road.

I spit on you (said in a scornful faux foreign accent).

[Paul_f]

Don't be too hasty in thinking that The Times article is sacrosanct in it's reporting.

You should read the Estate Agent today articles suggesting that landlords are unlikely to be able to reclaim commission already paid, and that renewal fees are not in themselves illegal, but merely that they should be prominently displayed on the first page of any terms of business and not hidden away in the main body of the text.

In other words landlords who sign agency contracts with the information clearly displayed will have no axe to grind if they commit themselves to such unwarranted fees.

[jeffrey]

Yes. That's how 'Unfair Terms' Regs. already work; individually negotiating the terms removes applicability of Regs; so no change there, then.

[agent46]

Yes. That's how 'Unfair Terms' Regs. already work; individually negotiating the terms removes applicability of Regs; so no change there, then.

The decision doesn't seem to have even gone as far as requiring individual negotation of renewal terms but deals with the issue in terms of "reasonable notice" instead. It has been the case at common law for many years that any particularly unusual or onerous terms must be specifically brought to the attention of the offeree; see eg: J Spurling Ltd v Bradshaw [1956] (the "red hand" rule) and Interfoto Picture Library Ltd v. Stiletto Visual Programmes Ltd [1988]

In other words, on the face of it, the Foxtons decision seems to add very little to the law on contractual terms, and probably could have been resolved without reference to the 1999 Regs. However, we should wait to see exactly what the judgement says.

[Blue Eyes]

I have been trying to pin down the exact outcome of the OFT v Foxtons court case but it seems to be somewhat nebulous; perhaps there has not been a conclusion yet?
I believe it concerns LAs applying charges in situations where a tenant continues to occupy the landlord's property after the initial fixed period of the tenancy has expired – even when the LA no longer collects the rent or manages the property.

I have a tenant who has now progressed on to a Periodic Tenancy. If I decide to manage the letting myself and want to give the LA notice to terminate our contract, I need to give them two months notice, as per the terms of business. However, also under the terms of the contract, it states that fees remain due on any tenancy, for which they have found a tenant, until the tenant vacates the property.

I believe that this could be considered as unfair and so not enforceable, the sort of thing covered in the Foxtons case. Can anyone confirm this for me or is the jury still out?

[Paul_f]

Just put the keywords into Google or the search facitlity on this forum for an answer. I posted the Estate Agent Today editorial of the court summary some time ago and it will still be on here somewhere.

[mind the gap]

Blue Eyes : http://www.landlordzone.co.uk/forums/showthread.php?t=9803&highlight=Foxtons&page=7

[Blue Eyes]

Just put the keywords into Google or the search facitlity on this forum for an answer. I posted the Estate Agent Today editorial of the court summary some time ago and it will still be on here somewhere.

Yep I had already done a search, but my inexperience of using the forum meant that I had only read the postings on the page I was taken to. On your suggestion I've looked again and realised my error and read the thread to the end; thanks.
Still don't have a difinitive answer to my question though but it seems there needs to be more time before there will be one.

[Blue Eyes]

Blue Eyes : http://www.landlordzone.co.uk/forums/showthread.php?t=9803&highlight=Foxtons&page=7

Thanks MTG. I had eventualy managed to find that posting.

>>This decision is not binding authority.<<

Does this mean that it can not be used as precedent?

[quarterday]

Thanks MTG. I had eventualy managed to find that posting.

>>This decision is not binding authority.<<

Does this mean that it can not be used as precedent?

Just so; the reason being, I think, that the foxton t and cs were ridiculous and went far beyond what any other agent had sneaked in their t and cs

first thing to do in my opinion is to formally terminate your relationship with the agent as per the t and c you signed

[Blue Eyes]

Just so; the reason being, I think, that the foxton t and cs were ridiculous and went far beyond what any other agent had sneaked in their t and cs

first thing to do in my opinion is to formally terminate your relationship with the agent as per the t and c you signed

Yes, that's what I had in mind. Then to get the tenant to make the rent payments direct to myself and leave the ball in LAs court, as to whether to take any action.

[mort]

Just an update.

If you are being taken to court by an agent for fees that you haven't paid then you are probably in a good position if you prepare your case well and the extension clause was not individually negotiated and written in the same way as the one in the Foxtons case.

I got taken to court last week and the judgement was in my favour so I don't have to pay.

[Atharhu]

I am being threatened with court action from my letting agents regarding renewal fees, The renewal clause was written in T&C and was under “Letting and management” section of the contract. I signed up for the Letting only service which does not have this clause however the agent is insisting this I am liable for this fees.
I would appreciate guidance from any one who has successfully defended similar case against their agent.
I don’t want to be bullied into paying as they have not done anything to earn this money and I have paid them for the initial service so I am willing to go court to defend it although I have never been to court in the past so I do find the task a bit daunting.
would really appreciate any help.



Just an update.

If you are being taken to court by an agent for fees that you haven't paid then you are probably in a good position if you prepare your case well and the extension clause was not individually negotiated and written in the same way as the one in the Foxtons case.

I got taken to court last week and the judgement was in my favour so I don't have to pay.

[jeffrey]

If your contract did not include this obligation, of course you're not liable. Do not be bullied by them. Stand firm.

[jeffrey]

Bad news!
The Times today reports that Foxtons:
a. have been given fresh hope by the Banks' recent victory (in the case brought by the OFT) at the Supreme Court; and
b. will appeal against the High Court decision.
See http://news.bbc.co.uk/1/hi/business/8429712.stm.