Here is a question to the blog clinic from Sam who is a landlord
Our tenants requested that they stay on for another year after their first year at the property which we agreed to and the letting agents sent out revised contracts which were e signed on our behalf by the company and we paid the renewal fee.
None months later we discovered that the tenants never actually signed the new lease so are on a rolling contract and the agency suggested that we chase them up instead.
Are the agency able to charge us for the £3000 renewal fee if they failed to actually get the lease signed or notify us about it? Are we able to get a refund?
The fees that your letting agent is able to charge will be governed by the terms of your agency agreement so you need to look at this and see what is says.
However if your agency agreement provides for the fee to be paid on renewal of the tenancy and it has not actually been renewed, then I can’t see how they can be entitled to charge the fee.
It is up to the agent to arrange for the new tenancy agreement to be signed and they have clearly not done this. Its a bit cheeky of them to suggest that you do it! That is supposed to be their job and they have already been paid for it.
On the other hand the tenants have actually been living at the property and paying rent. But not under a fixed term tenancy. They are legally entitled under a periodic tenancy to give one months notice and leave.
This is a case which will probably turn on the precise wording of your agency agreement but my feeling is that you may be entitled to a refund.
What do our letting agent readers think about this? How do your terms and conditions read on this issue and would you expect or be entitled to be paid in these circumstances?
One to be filed under ‘Do not do this, ever’.
R (Grimshaw) v LB Southwark  EWHC 4504 (Admin) [Not on Bailii, I've seen a transcript]
This started out well enough, as a judicial review claim of Southwark’s decision to terminate temporary accommodation. Soon after issue and interim relief had been granted, Southwark entered into discussions and, on 10 December 2012, an offer of accommodation was made to and accepted by the Claimant. Thus, one would have thought, the claim was effectively settled and its purpose fulfilled.
Nobody told the Admin Court. On 19 December 2012, the claim was given permission on the papers, with no update on the situation having been provided.
The Claimant’s solicitors, Gans & Co, then appear to have had a bit of a brainwave. Instead of telling the Court that the claim was disposed of, on:
10 January 2013 they gave notice on the claimant’s behalf that the claimant intended to make a claim for damages. This claim was said to arise in circumstances where the claimant had apparently been over paid housing benefits while housed in temporary accommodation which, following the defendant’s decision to terminate her temporary accommodation, she was now having to pay back. The suggestion, apparently, was that she had a claim for damages for having to repay the housing benefits which she had received in excess of the amounts to which she was entitled.
On 26 April, the Court order that the matter be listed for disposal unless the Claimant provided a consent order or notice of withdrawal in 14 days. The Court was still none the wiser.
Gans & Co sent a draft consent order to Southwark to withdraw the claim, then promptly withdrew that offer and maintained that the claim for damages continued. And so in July 2013, the claim was heard for disposal. Southwark applied for a wasted costs order against Gans & Co.
The purported damages claim got short shrift.
That was a manifestly spurious claim to attempt to argue within these judicial review proceedings for two reasons. In the first place it was a different claim from the original claim for judicial review for which permission to proceed had been given; and secondly the claim only has to be stated for it to be apparent that it had no realistic prospect of success.
And so to the wasted costs application. Counsel for Gans & Co, instructed the previous evening, did his best, arguing that
in substance, that the claimant was not prepared to consent to her claim for judicial review being withdrawn and wished to pursue the housing benefit claim, and his instructing solicitors went along with that.
That did not go down well:
That answer is, I am bound to say, a wholly inadequate one for Gans & Co to put forward. In the first place, and particularly when acting for a legally aided client, a solicitor has a duty to the legal aid fund and the court not to maintain spurious litigation simply because the client wishes that to be done. They should have, if necessary, ceased to act and certainly reported the matter to the legal aid authorities rather than continued in pursuit of an obviously hopeless claim. Secondly, that answer does not explain the failure of Gans & Co to answer correspondence or to engage in any meaningful discussion with the defendant’s solicitors over the period of months which have elapsed since 10 January when the issue of housing benefit was first raised, or certainly since the consent order was sent in draft and then withdrawn in May.
Since then, Gans & Co have failed to take any steps either to withdraw the claim or, if necessary, remove themselves from acting on the claimant’s behalf, did not inform the court of the position and did not respond to correspondence from the defendant until, I am told, Monday of this week when finally instructions were obtained and it was indicated on the claimant’s behalf that the claim would no longer be pursued.
The Court was satisfied that the three requirements for a wasted costs order had been met.
firstly that the legal representative has acted improperly, unreasonably or negligently – and for the reasons given I am quite satisfied that that requirement is met in this case. Secondly, that such conduct caused the applicant for a wasted costs order to incur unnecessary costs; as I have already explained that happened in this case. Third, that it is in all of the circumstances just to order the legal representative to compensate the applicant for the whole or part of the relevant costs.
In my view it is entirely just that Gans & Co should pay costs here. They have wasted not only time spent by the defendant’s solicitors and counsel, but the time of the court, including the hearing today, which would have been wholly unnecessary if they had acted reasonably and professionally in conducting this litigation. I consider that the costs should be awarded on the indemnity basis to mark the unreasonable nature of the conduct of Gans & Co.
Attempts to argue over specific costs and rates were batted away and a wasted costs order of £6,049.63 made.
Ouch. The lesson being that this is the kind of bright idea it is better not to have, or to explain to the client that it is not a bright idea at all.
David Smith (of Anthony Gold solicitors) is an old friend of the Landlord Law Blog. Yesterday he talked to me about the Housing Act 1988.
This is one of the most important acts for landlords as it regulates how most tenancies ‘work’.
In this podcast I talk to David about the types of tenancy covered by the act, and how the act affects shared houses, the increase of rent, periodic tenancies, and ending tenancies under sections 8 and 21.
We also talk a bit about the Court of Appeal decision in the case of Spencer v. Tracy which re-interprets the law on section 21 notices – if the decision is not overturned by the Supreme Court.
You can listen to the talk via the player belowNote that you can also find us on itunes >> here. >> Click here to be kept informed of new Landlord Law Live events
Confused by podcasts? See our >> podcast guide.
A “lack of available talent” in the conveyancing sector could lead to delays in completions of London property sales and could even curtail growth in transaction numbers.
That’s the warning from property recruitment company Venn Group, which says London’s vacancy rate for residential and commercial conveyancing jobs has risen 34 per cent between October and March.
A rush by overseas investors to snap up London’s commercial property, coupled with reports that confidence in the housing market reached a three year high this month, has sparked a boom in demand for conveyancing locums in the capital, the group says.
The firm says the early stages of a skills shortage can be spotted now and is down to not only the boom in conveyancing demand today but also an already-limited talent pool following the housing downturn in 2008. This is a sentiment mirrored in a recent report by the Law Society Gazette which reveals that the sector is already facing a skills gap following such a long period of retrenchment during the recession.
“Whilst law practices have increasingly used locums to plug permanent skills gaps, it is becoming more challenging to find qualified candidates” according to Jodie Finn, Venn Group’s associate director.
The group also believes that the introduction of the Mortgage Market Review next week - which will place additional demands on legal firms in terms of fulfilling banks’ anti-fraud criteria – may further exacerbate delays in the residential market.
“Our concern is that once the MMR kicks off, firms simply won’t be able to source the required manpower which could seriously impact the growth of the capital’s property market as we progress through 2014” says Finn.
- Estate Agent
- Venn Group
A new franchise branch of Northwood has opened in Shropshire, with another five or six new offices elsewhere in the country expected to be launched later this year.
Northwood has expanded from a pure lettings agency in 1995 - when it was called Residential Lettings - but has now become an agency handling sales and rentals plus financial services. The company has more than 80 offices from Aberdeen to Truro, employs around 350 staff and says it has some 20,000 clients on its books.
The latest branch is in Wellington, Shropshire, where franchise owner Andy Campbell secured funding from the Royal Bank of Scotland via two government-backed projects - the Enterprise Finance Guarantee Scheme and the Funding for Lending Scheme.
Northwood says all of its franchisees undergo a 10 year FCA-approved screening process prior to being granted a franchise.
- Estate Agent
Some 19 per cent of buyers pay above the asking price according to the National Association of Estate Agents.
It says the supply of housing on the market has fallen for the sixth consecutive month from an average of 57 properties in September 2013 to 42 in March 2014, almost a 10 year low.
NAEA member agents also reported an increase in the average number of sales agreed per branch, up from nine in February to 10 in March. It points out that although those looking to buy are serious purchasers, the average number of house hunters registering with NAEA agents dropped by five per cent in March, down from an average of 331 house hunters in February to 313 last month.
As the buyers face the realities of dwindling housing stock, the percentage of first time buyers purchasing a property fell from a four year high of 29 per cent in February to 25 per cent in March. Buyers looking to upsize from an existing home accounted for 50 per cent.
“The supply crisis continues to deepen and government must act now to offer house hunters hope in an increasingly congested market. Current conditions mean that in just a few months we’ve seen a large increase in the amount of people willing to offer over market price” says Jan Hÿtch, president of National Association of Estate Agents.
“Overall property sales may be up but the proportion of first timers purchasing a property is down and with the significant changes that the Mortgage Market Review will bring, we’ll be watching closely to see what kind of an impact is felt” she adds.
- Estate Agent
- housing market
The typical cost of moving house now stands at an average of £8,248 in total, with the share credited to agents’ fees showing an increase of seven per cent on a year ago according to Lloyds Bank, which commissioned the survey.
It says the total amount spent on moving has grown sharply by 27 per cent in 2013, from £5.2 billion to £6.61 billion, chiefly thanks to the rise in property sales after the downturn.
The rising cost of moving is driven by increases in stamp duty, estate agency fees and legal fees, which are all up by seven per cent - in the case of all of these, the increase is largely reflecting the higher sale prices and not increased charges.
The average spend on stamp duty and estate agency fees now stands at £2,001 and £3,601 respectively but there has been no change in removal costs and surveyors fees.
In the 10 years since 2003 the total cost of moving has increased by 22 per cent compared to house price rises of 31%.
In the same period, average gross annual earnings have increased by 29 per cent, meaning the total cost of moving as a percentage of earnings has actually fallen from 26 per cent to 25 per cent.
There are of course huge regional variations. Moving in London, for example, costs nearly five times more than in Northern Ireland
In London and the south east the cost is £20,825 and £16,187 respectively. Higher house prices drive these increases: the average home mover in London pays £10,850 in stamp duty and £6,510 in estate agency fees.
The south east has seen the highest rise in the cost of moving over the last decade, with an 85 per cent increase from £8,773 to £16,187. This is substantially higher than any other region and stands at 42 per cent of the average gross full time earnings for the region. A huge rise in the average stamp duty payment as a result of higher house prices, from £2,250 to £8,157, has driven this increase.
The most affordable place to move house is in Northern Ireland, where the average cost is £4,253, equivalent to 15 per cent of average gross earnings. Since 2003, the cost of moving in Northern Ireland has reduced 15 per cent, too, as the average house price has dropped below the level at which stamp duty is paid, significantly reducing the total cost.
- estate agents
- Lloyds Bank
- Cost of Moving
Another new Foxtons office, another local campaign against it. The agency that some Londoners appear to love-to-hate is in the middle of another neighbourhood row.
This time the location is Stoke Newington, where an office is scheduled to open next week. Residents say they are concerned about the company’s legendary all-evening “lights on” appearance, which locals say would spoil the look of the conservation area in which the branch will be located.
Liz Vater, director of a Hackney literature festival, is quoted in a local paper as saying: “It was probably inevitable that Stoke Newington was next on Foxtons’ rampaging expansion plan” while another opponent - Nick Perry - is quoted as describing the firm as having a “brash, aggressive approach, and a shop design to match” which “couldn’t have been less welcome” in the area.
The official statement from Nic Budden, chief operating officer at Foxtons, says: “We have enjoyed operating in these areas for a number of years from our neighbouring offices, but now with a new office on their doorstep we look forward to playing an even more active role in the local community.”
When planning consent was sought for the Stoke Newington office, opponents claimed it would be the 10th agent on the half-mile strip between Stoke Newington High Street to the east and Albion Road to the west.
- Estate Agent
- Stoke Newington
- Agents' Offices