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JustinP1
10,276 posts
99 months
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Karyn said: We could pay it, that's not the issue. The issue is they've not allowed negotiation, cannot justify what this fee is for, and are waiting for us to roll over and pay it. Still working on landlord negotiation. Will update later. Many, many thanks to all those that are taking time to post such helpful, informative replies  It's hugely appreciated. To answer your earlier Q, if you move out on the Monday and pay rent until then and someone moves in on Tuesday there is no loss of rent to them in both practical and legal terms. In short, you can only sue for losses, or in some cases loss of profit. In this case there is no financial change apart from the admin of replacing a tenant. As counterpoint, I am a landlord and a tenant, and from my experience, such a clause as you have mentioned is not in the contract my agent provides, but, it is in my tenancy agreement. Actually, it is specified at £250 (or thereabouts from memory), and offered at the discretion of the landlord. IMHO from what you have mentioned, although you may have differing views, looking at the facts, if you have a few months left on the tenancy, they've found a new tenant as oppose to you finding one, and they are letting you walk away from the contract for a fee equal to two weeks rent then that is not too bad a deal for you IMHO. Of course, it is your choice how far you push things. If you are mercenary you could push for more, but, IMHO what they have offered is in the ballpark for what I might expect an agent to charge, and not out of kilter with the value of your contract and any default.
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Zeeky
1,717 posts
81 months
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The OFT requires consumer rentals to either allow subletting or assignment. Most landlords do not allow subletting and opt for assignment instead. Even if the contract does not expressly allow assignment it would be risky for a landlord to refuse to allow it, subject to the replacement tenant being suitable.
As for poaching the agent's prospective tenant I really do not know. It may depend on the agreement between the prospective tenant and the agent.
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daz3210
5,000 posts
109 months
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Bluequay said: If the tennant is moving 2 months early with rent @ 600PCM - They effectively owe £1200 to the landlord in contracted rent.
If the landlord pays a letting agency £300 to find a new tennant, who moves in 1 week after the original tennant leaves. Then the landlord should be entitled to claim the following.
1 Weeks rent @ roughly £150
Letting agency fee £300
Total £450
Ask for a full breakdown of all the costs (It should only include the letting fee as the new tennant is moving in as you leave) But if the agency would have had the £300 fee in two months anyway, is it fair to charge the full £300? If its a six month let, with two months left, I would argue that morally the loss re letting fee is more akin to £100 (i.e. 1/3)
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Bluequay
1,135 posts
87 months
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daz3210 said: Bluequay said: If the tennant is moving 2 months early with rent @ 600PCM - They effectively owe £1200 to the landlord in contracted rent.
If the landlord pays a letting agency £300 to find a new tennant, who moves in 1 week after the original tennant leaves. Then the landlord should be entitled to claim the following.
1 Weeks rent @ roughly £150
Letting agency fee £300
Total £450
Ask for a full breakdown of all the costs (It should only include the letting fee as the new tennant is moving in as you leave) But if the agency would have had the £300 fee in two months anyway, is it fair to charge the full £300? If its a six month let, with two months left, I would argue that morally the loss re letting fee is more akin to £100 (i.e. 1/3) Morally doesn't come into it, the tennants actions are causing the charge and the landlord is entitled to charge for it. The tennant signed the contract, they now want to break it, charging them any fees incurred and no more is perfectly reasonable. Making up a figure of 1/2 the remaining rent is not!
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daz3210
5,000 posts
109 months
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Bluequay said: daz3210 said: Bluequay said: If the tennant is moving 2 months early with rent @ 600PCM - They effectively owe £1200 to the landlord in contracted rent.
If the landlord pays a letting agency £300 to find a new tennant, who moves in 1 week after the original tennant leaves. Then the landlord should be entitled to claim the following.
1 Weeks rent @ roughly £150
Letting agency fee £300
Total £450
Ask for a full breakdown of all the costs (It should only include the letting fee as the new tennant is moving in as you leave) But if the agency would have had the £300 fee in two months anyway, is it fair to charge the full £300? If its a six month let, with two months left, I would argue that morally the loss re letting fee is more akin to £100 (i.e. 1/3) Morally doesn't come into it, the tennants actions are causing the charge and the landlord is entitled to charge for it. The tennant signed the contract, they now want to break it, charging them any fees incurred and no more is perfectly reasonable. Making up a figure of 1/2 the remaining rent is not! It all comes down to what a judge considers reasonable. At work we have contracts that call for 3 months notice in writing. WE have tested it in court. Judges will not award the full contract price for any failure to give that notice, but will only award calculated losses. The re-letting fee would happen sooner or later. The sooner figure is 1/3 of the contract price...... I would not be surprised at a judge awarding in that way if the case was put appropriately.
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Karyn
Original Poster
5,398 posts
37 months
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Bluequay said: Ask for a full breakdown of all the costs (It should only include the letting fee as the new tennant is moving in as you leave) This has been asked for. They cannot/will not provide either a breakdown of costs incurred on their part by our actions (which we have said we would cover), or a breakdown/justification of this penalty fee - there is no breakdown of it, because it is simply "50% of the rental amount". We are willing to pay costs such as are incurred by our premature departure against the contract. The time difference about 2.5 weeks. Contract end date, 02-July. Prior agreed move-out date, 15-June. For which we would have to pay this penalty fee. As mentioned, new tenants had already been found, and there had been small discussion (with agents) that perhaps we could move out even earlier, as tenants were eager to move in within 4 weeks (which would have been within the time frame that we were still present at property). Also discussed was that we would only be liable for rent up to the point that the new tenants took over, as well as "re-let fee" (no value placed on it). Ironically, if the intial agreed end date was still used, we'd be paying approximately half rent as well as the re-let fee, meaning we'd be paying a value roughly equivalent to full rental amount, but still moving out earlier than the contract end date. So absolutely no chance of landlord being out of pocket, rent-wise. If the agents had come back to us and said, "fee is to cover finding new tenants, broken down into XYZ" etc., then all would have been well and good. As said, we have tried to agree to cover costs incurred by them by our actions. Landlord is happy as long as there is no break in tenancy. As an aside, we have done everything else by the book - months notice in writing, etc etc. Justin - if the value had been in the contract, I would have picked up on it before signing! As it was, I simply read the clause, niavely assumed (what's that about 'assume', 'ass' and 'me'?!) that "penalty" would mean paying for the costs incurred, and left it at that.
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daz3210
5,000 posts
109 months
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I would write to them rather politely, and tell them that you are trying to be fair and reasonable, and expect them to be.
Point out that this could easily end up before a small claims court if they do not meet the fair and reasonable test, and that you will then consider asking the judge to make an order that they produce the information that they have already been asked for, in order that the court can make an informed decision as to whether their claim is approriate. Also point out that if by their neglect to supply the information without such an order, and your request to the court for such an oder is successful you will then request that the court considers whether any award for court fees etc against you is inappropriate, since a reasonable approach from the agent would have prevented a waste of court time.
The above may or may not actually be accepted by a court, each judge would/may see things differently, but I have used such an approach a number of times where customers have been refusing to pay and refusing to elicit information that I needed to make an informed decision as to whether their approach was fair. I have yet to have to actually test such an approach in court, it has every time obtained information that I needed.
One thing is for certain, courts do not like timewasters, and the approach the agent appears to be taking could end up with them being seen as just that.
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Zeeky
1,717 posts
81 months
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From what the OP has posted the agent's finding of a new tenant is a service they have offered independent of the contract. They can charge whatever they like for this service. I cannot see how a court would be able to consider what is a reasonable charge for providing such a service. If you don't like the price you simply don't use the service.
If, on the other hand the OP abandons the property then the agent/landlord will be entitled to damages up to the point they take possession of the property. In that case the court would look at the actual costs incurred and they may well be less than the fee the agent wishes to charge. That is why Justin suggested threatening breach of the contract.
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daz3210
5,000 posts
109 months
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Zeeky said: From what the OP has posted the agent's finding of a new tenant is a service they have offered independent of the contract. They can charge whatever they like for this service. I cannot see how a court would be able to consider what is a reasonable charge for providing such a service. If you don't like the price you simply don't use the service.
If, on the other hand the OP abandons the property then the agent/landlord will be entitled to damages up to the point they take possession of the property. In that case the court would look at the actual costs incurred and they may well be less than the fee the agent wishes to charge. That is why Justin suggested threatening breach of the contract. That all depends on what the circumstances are surely though. If the OP has given notice, and the agent has just gone out and found another tenant without alerting the OP to the consequences, a court could look at that course of action as unreasonable and not award anything. And they probably couldn't 'just charge what they like', the bill has to reasonable unless agreed otherwise with whoever has it to pay!.
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KevinA3DSG32
6,078 posts
149 months
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Zeeky said: From what the OP has posted the agent's finding of a new tenant is a service they have offered independent of the contract. They can charge whatever they like for this service. I cannot see how a court would be able to consider what is a reasonable charge for providing such a service. If you don't like the price you simply don't use the service. If the letting agent customarily charges a 'finder's fee' to a landlord upon commencement of a tenancy then the court will very easily find that the service is of this value. If I read it correctly OP you had a 12 month tenancy and wish to leave 2.5 weeks early? I would argue that the landlord would be paying the finder's fee for a new tenant in 2.5 weeks anyway, therefore he/she has not suffered a loss. By agreeing to move out earlier in June to suit the new tenant I would argue both sides are in breach. In your position I would write direct to the landlord offering to move out early to allow the new tenant in and in return ask the landlord to waive the 'finder's fee'. Point out that if you stayed they would have to pay the fee anyway and may risk a tenant free period. If they do not agree to waive the fee I would stay until 12th June, pay all the rent and not release the property until the 12 months is up.
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Zeeky
1,717 posts
81 months
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daz3210 said: That all depends on what the circumstances are surely though.
If the OP has given notice, and the agent has just gone out and found another tenant without alerting the OP to the consequences, a court could look at that course of action as unreasonable and not award anything.
And they probably couldn't 'just charge what they like', the bill has to reasonable unless agreed otherwise with whoever has it to pay!. You are correct that the OP must agree to the charge for it to be enforceable. The fact that there has not been an agreement as to the value of the "penalty" almost certainly means there is no contract. If there is no contract neither party is bound by the agreement. The agent cannot be forced to provide a replacement tenant except in accordance with a contractual obligation to do so or if the court finds that there is a requirement for the agent/landlord to mitigate their losses if they repossess the property and claim damages. KevinA3DSG32 said: ...If the letting agent customarily charges a 'finder's fee' to a landlord upon commencement of a tenancy then the court will very easily find that the service is of this value... The court cannot imply a value to the 'penalty' to make the agreement enforceable. The question of value simply does not arise unless there is a claim for damages. The only value that is enforceable pursuant to a contract is that agreed by the parties.
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JustinP1
10,276 posts
99 months
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KevinA3DSG32 said: In your position I would write direct to the landlord offering to move out early to allow the new tenant in and in return ask the landlord to waive the 'finder's fee'. Point out that if you stayed they would have to pay the fee anyway and may risk a tenant free period. If they do not agree to waive the fee I would stay until 12th June, pay all the rent and not release the property until the 12 months is up. This is great advice. You've been willing to help them find a tenant, and they have one, and you are accommodating them.
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Karyn
Original Poster
5,398 posts
37 months
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Just had contact from landlord.
Still no-go on the fee reduction (I've not even asked for it be waived... willing to pay £200!). They're playing hardball with landlord, saying we've both (us and landlord) agreed to it by signing the contract.
It's hazy whether it's to cover their finders fee, or what. Just that they call it a "re-let" fee, and it's payable by us. Given that the landlord didn't know about the fee at all until we revealed it, I'd imagine it's not payable to the landlord, either...
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Zeeky
1,717 posts
81 months
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I believe they are incorrect to claim that you have agreed to the 'fee' on signing the contract as you did not know what it was.
Having said that, I should repeat that they are not obliged to 're-let' the property in order to release you from the contract. If you don't want to pay the (excessive) fee then that is your choice.
You can leave without asking the landlord to re-let the property but you may be liable for the rent for the remaining time unless you find another suitable tenant.
If you say you are staying until the end of the contract and they attempt to pursue you for their costs in finding a replacement then you have a defence to such a claim.
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Dracoro
6,678 posts
114 months
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Does the letting agent somehow have exclusivity over the property?
Why is the landlord even considering using them again to fine the replacement tenants after this shenanigans?
If I was the landlord, I would just say the agent "look, work out a mutually agreeable deal else I won't have you managing the property anymore".
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daz3210
5,000 posts
109 months
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Dracoro said: Does the letting agent somehow have exclusivity over the property?
Why is the landlord even considering using them again to fine the replacement tenants after this shenanigans?
If I was the landlord, I would just say the agent "look, work out a mutually agreeable deal else I won't have you managing the property anymore". But then could the agents impose some other clause in a contract with the landlord where they can stiff him with unfair penalties too? What a shame the agent can't be named and shamed.
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Karyn
Original Poster
5,398 posts
37 months
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Well, many, many thanks to all who inputted into this thread. I was all ready to fight this to the bitter end (thieving barstewards), but landlord has rolled over when told, "let us deal with this from now on, it's what you pay us for. You both ( that would be us and the landlord) agreed to this penalty by signing the contract". So, with the rather sweeping assumption on his part that it's the easiest route, and the one of least inconvenience, we've been asked by the landlord if we would mind just seeing out the end of the tenancy, as they've spoken to the prospective tenants and they're happy to wait the extra two weeks.  I can't really see a different route out of this without the backup of the landlord that won't involve jeopardising the rather large deposit and without taking it further, legally speaking. Added to which, OH seems to have lost of bit of vim on receipt of the latest news from the landlord. So, we're not paying any penalty fee but will be paying full rental amount, and we'll will be keeping a weather eye out on all further similar clauses! I'm annoyed that the letting agents have "won", though. I really wish I could name and shame. Although a "client feedback" form landed on the mat today......... Did I say thank you to you wonderful, wonderful chaps?? 
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mjb1
662 posts
28 months
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Karyn said: I'm annoyed that the letting agents have "won", though. I really wish I could name and shame. They haven't really won though - you signed up to an AST of a fixed duration, and you are liable to pay the rent until the end of it. If they were being really awkward they could just have insisted that you pay until the end, they don't have to offer the reletting service at all. Looking at it from the other side though, it is obvious that the agent is really looking for a new tenant on behalf of the LL, not the existing tenant's benefit. I mean, at this stage of the tenancy, and given that the tenant has served notice to terminate, the agent would be looking for a new tenant regardless. Which makes the 50% fee rather steep.
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sugerbear
508 posts
27 months
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the agent is being a dick. There are now two weeks in which the new tenant can back out and find another property and then leave the place unlet. So for the sake of two weeks rent the house could be unlet for weeks.
As a landlord I wouldn't touch the agent with a bargepole.
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Karyn
Original Poster
5,398 posts
37 months
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mjb1 said: They haven't really won though - you signed up to an AST of a fixed duration, and you are liable to pay the rent until the end of it. If they were being really awkward they could just have insisted that you pay until the end, they don't have to offer the reletting service at all. I know we are liable for rent to the end of the contract. That was never the issue. The issue arose when they wanted us to pay a summed value that was equivalent to a months rent to move out 2 weeks early, with no reasonable negotiation. mjb1 said: the agent would be looking for a new tenant regardless. Which makes the 50% fee rather steep. This is part of the issue. 2 weeks is all we were talking about. They would have to look for a new tenant in 2 weeks regardless, as you say, without or without us paying this "penalty fee". And, point of fact, we were happy to pay a penalty fee. A reasonable, realistic, jusified fee...
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