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Joshua, Lawyer
Category: Law
Satisfied Customers: 26070
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
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Hi, I have just exchanged on the sale of a property where 1)

Customer Question

Hi, I have just exchanged on the sale of a property where
1) my agent has held me to ransom to pay a higher fee
2) has received a fee from the buyers representative
3) has split the fee I have agreed to, under duress, with the buyers rep and maybe even the buyers lawyer.
Is this within the code of practice or can I make an official complaint?
Thank you for your help
Submitted: 4 years ago.
Category: Law
Expert:  Joshua replied 4 years ago.

Josh-2010 :

Thanks for your question. Please kindly RATE my answer when you are satisfied

Josh-2010 :

On what basis did he demand a higher fee please?

Josh-2010 :

Also how has he split the fee as you refer to?

JACUSTOMER-dy1vs81p- : I was told that the buyer had another choice but the buyers rep could persuade in my direction if I increased the fee.
JACUSTOMER-dy1vs81p- : the fee is split almost 50/50 from my payment
Josh-2010 :

Is this a residential sale? Do you have the above in writing?

JACUSTOMER-dy1vs81p- : Yes it is residential, the above was a telephone conversation and I wasn't given much opportunity to discuss other than agree
Josh-2010 :

Thanks. For clarity the fee you refer to was simply the fee payable to the agents and not related to the price of the property?

Josh-2010 :

Did you agree the fee increase in writing?

JACUSTOMER-dy1vs81p- : It was an agents commission as a % of sale price
JACUSTOMER-dy1vs81p- : yes but only by an e signature on the agents contract
Josh-2010 :

Thanks. Finally are you paying a higher fee as a result than the buyer or will the buyer end up paying more as well as a result of your agreement?

JACUSTOMER-dy1vs81p- : No paying purely to receive the offer from the agent
Josh-2010 :

Sorry could you clarify your last post - I don't fully follow. That should be my last question

JACUSTOMER-dy1vs81p- : I am paying the higher fee so that my estate agent can persuade the buyers agent with a higher financial reward to persuade the buyer to buy my property
Josh-2010 :

Thanks. There are two issues here. One of contract and one of agency law as follows...

Josh-2010 :

If the agent had already agreed a fee to sell the property with you as the seller (as is normal) he cannot charge a further fee for carrying out a service he is already bound to carry out under a contract. nor can he charge a further fee to another for carrying out the same service he is already bound to carry out. The above is a long established decision under Stilk v Myrick (1809) and Hartley v Ponsonby (1857).

JACUSTOMER-dy1vs81p- : Ok so I should make my complaint to the ombudsman?
Josh-2010 :

If the agent promised to do something additional for you however which is beyond his initial contract or that he was not already bound to do under his existing contract then if you agree to pay the fee for that service you would be required to pay it. I am not convinced he has agreed to anything he i not already bound to do here from what you say.

JACUSTOMER-dy1vs81p- : Is this not a conflict of interest with receiving fee from buyer AND seller? I was informed this was not legal for an agent?
Josh-2010 :

Sorry with your permission I will address the points you make in just a moment if you would bear with me?

JACUSTOMER-dy1vs81p- : Ok
Josh-2010 :

Agency law is very clear on the fiduciary duties an agent owes to its principal (you). They are the fundamental principles that govern an agent - principal relationship notwithstanding the agency agreement. Essentially they owe you a duty of loyalty, obedience, skill and care, and a duty to account to you as principal

Josh-2010 :

Accordingly if they fail to or conversely act in a manner which is contrary to the above principals this can be a breach of the agents fiduciary duties and may also be a breach of the agency agreement

Josh-2010 :

If you have complaints regarding the agents performance or actions you can consider contacting them in writing raising your complaints and asking them to confirm to you within 7 days for a response. duress is not an appropriate defence to raise because the courts required in most circumstances evidence of a fear of physical harm for such a defence to be raised however it would appear you have potential complaints on the basis of breach of contract and breach of agency law

JACUSTOMER-dy1vs81p- : So is it legal for an estate agent to receive a fee from the buyer and the seller? Y or N?
Josh-2010 :

There is nothing wrong in agreeing to split the fee however such an agreement must not prejudice the agents duties under agency law as above. If such an arrangement makes it impossible for him to act in your best interests as his principal then such an arrangement can amounts to a breach of his producing the duty to you in this respect

JACUSTOMER-dy1vs81p- : Sorry let me phrase another way. The estate agent is not just receiving the fee I am paying, they are receiving a second fee from the buyer. Is this legal Y or No?
Josh-2010 :

if you are not satisfied with the agents response following your above complaint, if the agent is a member of the property ombudsman service you can escalate your complaint to them. they have the power to consider all the circumstances and award compensation to you if they find you deserving of the same. The decision is binding upon the agent but not upon you and if you wish you can elect to go to court if you prefer either as an alternative or following the outcome of your complaint to the ombudsman

Josh-2010 :

receiving a second fee which was not provided for in your original agency agreement is a different matter and we go back to the above case, Stilk v Myrick (1809) and Hartley v Ponsonby (1857) which is a long established principle of contract common law which provides that he cannot charge a further fee to another for carrying out the same service he is already bound to carry out.

Josh-2010 :

I am sorry you have had cause to rate my service to you as bad. Is there something above that I can clarify for you?

Josh-2010 :

If you have no further questions for now I should be very grateful if you would kindly take a moment to rerate my service to you today. Your feedback is important to me. If there is anything else I can help with please reply back to me. I will be unavailable until after circa 10pm tonight now but I would welcome the oportunity to assist you further with any further questions you may have on the above.