Foxtons could be facing a hefty legal bill after charging a landlord over £600 to change a light fitting.
In 2013 London landlord Dr Chris Townley was billed £616 by the agency for the replacement of a light fitting carried out by a subcontractor.
On Saturday, The Daily Mail reported that Leigh Day Solicitors has served the agency with a letter of claim, which is sent prior to legal proceedings.
Leigh Day believes that Townley and thousands of other landlords could be entitled to compensation from Foxtons, a claim which it says could amount to over £40m.
Foxtons used subcontractor Maintenance 1st to carry out the work on Dr Townley’s rental property, which had been managed by the London agency since 2011.
After requesting a refund for the work – which he believed to be substandard – the landlord was put in touch with Maintenance 1st.
The firm informed him that its charge for the work amounted to £412.50.
Townley then challenged Foxtons on the difference in costs and found out that the agent had charged 33 per cent commission, equating to an additional fee of £137.50.
The landlord then also liable for an ‘ad hoc management charge’ of 10 per cent plus VAT, which was incurred after Foxtons’ commission had taken the invoice over £500.
This means that Dr Townley ended up paying £200 over the subcontractors’ original fee for the work.
Solicitors Leigh Day believe that the agency was wrong for failing to declare a conflict of interests as it earns commission from subcontractors and landlords.
The Daily Mail reports that Foxtons says all its charges were made clear.
The highly-successful agency was in the news last week over its intention to move into an historic pub in South London.