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Joshua
Joshua, Lawyer
Category: Property Law
Satisfied Customers: 26069
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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my son has paid real estate agents £360 to end his contract.

Resolved Question:

my son has paid real estate agents £360 to end his contract. they are now saying he has to continue paying the rent on the property until it is re-let can they do this?
Submitted: 3 years ago.
Category: Property Law
Expert:  Joshua replied 3 years ago.

Joshua :

Hello and thank you for your question. I will be very pleased to assist you. I'm a practicing lawyer in England with over 10 years experience.

Joshua :

May I ask when his fixed term of the tenancy expires(ed) please roughly?

Joshua :

What exactly was he given to understand the fees demanded were for please exactly?

Customer:

he told the company he wanted to end the contract at the beginning of november and paid the £360 cancellation fee.they rang him today and said he has to continue to pay rent on the property until it is re-let which is £550

Joshua :

May I ask when his fixed term of the tenancy expires(ed) please roughly?


Joshua :

What precisely was he told the fee was to cover - or did they simply say it was for cancellation of the contract without specifying?

Customer:

the original contract was until february 2014. they said the £360 was a cancellation fee

Joshua :

Thanks. Did they lead him to believe through implication or confirmation that he just had to pay the fee and that was it or did they explain that he would have to continue to pay rent and so on before he paid the fee?

Customer:

he under stood that it ended the contract there was no mention of paying rent any more although they told hm this morning it was in his contract

Joshua :

Thanks. OK I presume he had nothing to this effect in writing but it was all agreed verbally?

Customer:

he wrote a letter to the letting agent giving a months notice and took it into the office and they said he had to pay £60 cancellation fee which he did there in the office

Joshua :

Thanks - just to confirm £360, not £60 - correct?

Customer:

sorry typo £360

Joshua :

Thats fine - I do it all the time. Thanks...

Joshua :

Leaving aside the issue of the fee for the moment the starting point is that if your son wishes to leave the tenancy, before the end of the fixed term subject as follows the starting point is that he cannot unilaterally leave during the fixed tenancy period. However it is possible to escape early from the tenancy by asking the landlord to remarket the same. The landlord has a common law duty to mitigate his costs and as such must do either do his best to remarket the property himself or his agents can do so on his behalf. He would be liable for reasonable marketing costs together with any reasonable agency fees. However his liability for rent would end on the earlier of the end of his existing term or a new tenant being sourced to replace him. Alternatively he could agree the fixed compensation proposal if this is preferable to he and the landlord. The landlord cannot refuse to do anything at all or he will find that he is limited in the amount of continuing rent he can attempt to recover. He can leave without notice at the end of the fixed term but must ensure the keys are returned before the end of the fixed term or a periodic month to month tenancy will automatically arise.

Joshua :

In the assumption a new tenant can be sourced to replace him as tenant, then as above his liability will end on the earlier of the end of the fixed term or the date the new tenant moves in. A new tenant can typically relatively easily be found particularly at present as the rental market is quite buoyant at present. In the unlikely event that a new tenant cannot be found to move in at the same rent he is paying, he could give consideration to subsidising a reduced rent for the remainder of the fixed term - i.e. if he is presently paying £1000 a month but the most a replacement tenant would pay is £950 per month, you could consider offering to pay £50 per month difference for the remainder of his fixed term period. The landlord cannot seek to rent the property for a higher rental figure or on different terms to that which he rents the property to your son or he will be in breach of his common-law obligations referred to above

Joshua :

In terms of the agency fee he has paid. As above he is liable for the landlords reasonable remarketing costs associated with reletting the property however they are not allowed to profit from his request and he can request a full breakdown of the charges they seek to impose. In addition if they charged the fee under false pretenses he can consider claiming the same back but if he wishes to move out early, he would be liable to pay reasonable re marketing fees as above.

Joshua :

If he had evidence that the agents advised his contract would end on payment of the fee or on the date of his notice then he would be entitled to rely on this but from what you say this is not the case. He should check his tenancy agreement carefully to see if there is a break clause giving a right to end the tenancy after a certain point. If there is a break clause that gives such a right then he can serve notice in accordance with the clause and then the tenancy ends in accordance with the same. Not all tenancies have them but they are no uncommon.

Joshua :

If the agent cannot justify their fee as reasonable then it constitutes a penalty and potentially an unfair contract term and is unlawful and the difference between what can be reasonably justified as remarketing costs and what they charged must be refunded.

Joshua :

If there are significant repair issues in respect of the property then your son may have an alternative approach in addition to the above. Please let me know if this is the case. In addition his deposit should have been protected within a month of his moving in. If it was not he can claim up to three times the amount in compensation in addition to the deposit back.

Joshua :

If in doubt he can confirm online. There are 4 schemes:
http://www.mydeposits.co.uk/tenants/get-started/check-your-deposit
https://www.depositprotection.com/is-my-deposit-protected
https://www.thedisputeservice.co.uk/is-my-deposit-registered.html
https://www.capita-tdp.co.uk/

Customer:

he moved out on 9th november and paid the rent until the 28th. They are also holding £800 deposit that he paid. there are no significant repair issues and he says this was protected

Joshua :

Thanks. The liability for rent is as above. he is of course entitled to move back in until the property can be relet as if he is paying rent then it follows that he is allowed occupation of the property.

Joshua :

The deposit can be retained pending the property being relet and the tenancy accordingly ending.

Joshua :

He can check to ensure that the property is being actively remarketed by the agents using online property site searches and even by secret shopping posing as a new prospective tenant interest in the property. if he finds that they are not then he may seek to pay no more than what is a reasonable amount of time for them to find a new tenant. 2 months is usually sufficient unless there is good reasons to show that it would likely take longer.

Customer:

ok so my understanding is that he is liable for the rent until either a new tenant is found or 28th february when his original contract ends and they were allowed to take £360 early exit fee is this right

Joshua :

On the rent - that is exactly right providing the agents are genuinely remarketing as above and he can test this as above. Re the cancellation fee - they can only charge a fee that they can demonstrate truly reflects their remarketing costs and he can ask for a precise breakdown of how the fee has been calculated and request further information as necessary to determine this. If they cannot justify the fee then he can require a refund of the difference between what is reasonable and what was charged as above.

Joshua :

Is there anything above I can clarify for you any further?

Customer:

no thank you I think i'm clear on where we stand thank you so much for your help

Joshua :

A pleasure. If I can assist any further as the situation develops please do no hesitate to let me know.

Joshua :

If you have no further questions for now I should be very grateful if you would kindly take a moment to rate my service to you today. Your feedback is important to me. If there is anything else I can help with though please reply back to me though.

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