Agent expelled by Ombudsman after appeal fails

Thursday 19th July 2012

A letting agent has been thrown out of the Property Ombudsman scheme after losing its appeal against expulsion. By law, the agent will remain registered for sales, but the Ombudsman has issued public warnings.

The Ombudsman says that WYL, of Keighley in Yorkshire, had committed ‘serious breaches’ of the TPO lettings code of practice and failed to pay an award of £3,450 made against it after a landlord’s complaint was upheld.

WYL refused to pay the award made against it by the Ombudsman, saying that as a small business it could not afford it.

According to the Ombudsman, the firm had failed to provide its terms of business to the landlord, or get him to sign a copy, and had failed to protect a tenant’s deposit.

WYL had also failed to inform the landlord of offers received so that he found out from a third party that a tenancy had been agreed at a reduced rent, failed to supply quotations of estimates for work despite requests to do so, and failed to provide evidence that the works had been arranged or the money paid out to a legitimate contractor.

WYL argued that repair work had been completed satisfactorily and had been approved by a friend of the complainant, but the Ombudsman could find no evidence of this.

Ombudsman Christopher Hamer reported WYL to the TPO Disciplinary and Standards Committee. As the agent had failed to pay the award and had breached other aspects of the TPO code of practice, the committee decided to expel it from membership.

WYL lodged an appeal, saying that an employee responsible for the breaches had been subsequently dismissed. However, the firm chose not to attend the appeal hearing. The appeal was dismissed, as evidence showed that the proprietor of WYL had been involved in the case. The hearing also felt that there was a broader point, that an employer has to take responsibility for the conduct of employees.

TPO board deputy chairman Gerry Fitzjohn said: “Whilst we can expel the agent for its lettings business, it is a peculiarity of the Consumers, Estate Agents and Redress Act that we have to keep the firm registered with us for its sales activity.

“That Act requires sales agents to join an approved redress scheme, and expelling WYL from the sales jurisdiction would have the effect of banning the firm from the industry, which can only be done by the Office of Fair Trading.

“We are making the OFT and local trading standards officers aware of this decision.

“We also noted that the agent had not provided proof that client money was being held in a separate account as required by the TPO Code of Practice. This presents potentially a very serious risk to those customers of that agent, particularly when this firm has already defaulted on an award made against it and has said it is too small to be able to afford recompense independtly awarded to its customers.

“That should serve as a warning over potential future problems, which is why we are alerting the public about this estate agency.”

On its website, the firm says that it was established in 2009 and has become the fastest growing estate and letting agency in Keighley.