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TODAY'S OTHER NEWS

Agency caves in to tenants refusing to pay fee: does this set a precedent?

Two tenants who campaign against lettings fees are claiming victory after refusing to pay charges for renewing their tenancies. 

The agency was one of the largest in Bristol - CJ Hole, part of The Property Franchise Group - and the two tenants argued against the £90 renewal fee by saying that if they were new tenants, they wouldn’t have had to pay anything thanks to the ban contained within the Tenants Fees Act which came into effect in June. 

The Bristol Live news website reported that Nick Ballard and Louie Herbert, both members of the Acorn campaign group, refused to pay. 

They are quoted as saying: “CJ Hole effectively terminated their contract with us when it ended and we’re entering a new contract. If we were new tenants, they couldn’t charge this, so we decided we weren’t paying it either…We thought we’d just flat out refuse to pay it and see what happened.”

They continued: “We pointed out we were happy to simply sign a fresh contract, our landlord was happy to sign a fresh contract, and that’s all there was to it - there is no justification for them to charge us £90 for that.

“The thing is that starting to evict us for the sake of a fee the lettings agency were charging would cost everyone a lot more money - especially when both us and the landlord were happy for things to carry on as normal … It was a little bit of a daunting prospect, because we could’ve lost our home. We think it’s a legal grey area, and it was the principle of the thing for us. It’s a mad legal space for a year of this transitional period.” 

The pair signed the renewed contract but refused to pay the charge and embarked on an apparently-lengthy email correspondence with CJ Hole; the agency was entitled to make the charge as the ban on fees levied on tenants currently applies only to new tenancies, with it spreading to all tenants - including those renewing tenancies - next year.

The company is reported to have then agreed to waive the fee. The Bristol Live story says:  

“As the deadline loomed, CJ Hole maintained they had the legal right, still, to charge the pair a tenancy renewal fee, but then eventually simply dropped the demand, and asked them to sign the contract without asking for a fee.”

The tenants now claim this is a precedent. 

“This means that between now and next summer, everyone renting in Bristol who renews their contract to stay living in a rented property will have to pay lettings agencies just to send out fresh contracts to sign. Our demand was for £90, but sometimes they are a couple of hundred pounds. If everyone just simply refused to pay them, as we have done, then this will save tenants across the city tens of thousands of pounds combined” one of the tenants tells Bristol Live.

Letting Agent Today has asked CJ Hole for its comment on the controversy.

On the Bristol Live website the agency is quoted as stating: “Unfortunately we are not at liberty to discuss individual cases although we can confirm that any fees being put to tenants are being done so in accordance with the Tenant Fees Act 2019. 

“Until May 31, 2020, the law allows for a transitional period (12 months) whereby tenants are still liable for fees/charges stated in their fixed term tenancy agreement entered into before the June 1, 2019.

“If the tenants you refer to are/were in a fixed term tenancy that started before the 1st June 2019 any renewal fees stated in their agreement would be payable as it would be for any other tenants in the same situation.”

Poll: Should an agency back down like this?

PLACE YOUR VOTE BELOW

  • icon

    Its Not advisable to ' Renew Tenancy agreements ' anyway, as soon as a Six Month fixed term end, and as soon as the tenancy goes Periodic, the Landlord is in a better position ( can issue Possession proceedings if necessary.
    Its mainly Agents who are in the habit of renewing Tenancy agreements ( and having to go through all the work of Re-serving the numerous documents ) because they used to charge for it. !

    Kristjan Byfield

    Half true- whilst a periodic enables a landlord to serve notice as/when/if they want- the same applies to the tenant.

     
  • Nic  Chbat

    Its sickening to see this culture of not paying for a service provided by an agent, whether it be landlord or tenant, be celebrated as some sort of victory. If they didnt want to pay the renewal fee then why not just not renew and let the tenancy roll on to a periodic. If you expect someone to do something for you and not pay for it, you are not just immoral but delussioned. If you persist in that attitude no business or organisation can be sustained and it is the consumer themselves that loses in the end. The consequences of this trend will soon come back to haunt them!!

  • jeremy clarke

    I agree with Nic Chbat, this ongoing culture of wanting everything for nothing has to stop. It would be interesting to know what these tenants do for a living and whether anyone using their services would get away with simply not paying?
    With government departments trying to trip agents and landlords up by silently issuing new htr guides and rebellious tenant organisations promoting breaking the law as a "right" someone somewhere has to get a grip before it all goes badly wrong. My hope is that Boris J who seems to have more b***s than any PM since Mrs T, can be persuaded that without the prs the gov has serious housing issues and that he will reverse some of Theresa Mad's policies!

    Algarve  Investor

    It's true that Johnson favours a non-interventionist approach when it comes to private renting, but it's also true that most of his speeches on housing have favoured home ownership over renting. So I think your hopes could be misguided, particularly when it comes to a serial liar and incompetent like Johnson.

     
  • icon

    The entitled snowflake generation strike again

    Algarve  Investor

    Doesn't the fact they refused to pay - to see what would happen - suggest they were actually the opposite of snowflakey?

    They took a stand - which you can agree or disagree with - but it was the agency who gave in in this case. Not too snowflakey if you ask me.

    It seems, in this case, the agency were wrong to give in under the conditions of the fees ban, but it would help if the legislation was clearer in how it's being phased in.

    Quite a lot of confusion still surrounds the fees ban, I think, despite all the coverage it's received.

     
  • Kristjan Byfield

    It really depends on a case by case basis- is £90 worth a lot of debating over? Is there value in not renewing and placing new tenants there possibly at a higher rent? Would this be in the clients' best interests? Whether you look at it from the agency or tenant perspective the question has to be- is the work involved worth the fee/saving? The fees will all be banned in 10 months and renewals (vs new let fees) will be a significantly smaller source of revenue so, in reality, this should be of little concern for many agents. We have known about this for so long that every agent should have been prepared for this.

  • S l
    • S l
    • 06 August 2019 13:19 PM

    this tenant fee ban is unreasonable as they are stopping payment for service rendered. did they stop solicitor from charging for new contracts , new trust deed, commercial contract renewal etc etc. Perhaps one way of doing it is to have a separate legal department where the letting agents pass on legal documents to a separate legal department to charge? Likewise, with a mortgage, when you enter into a new mortgage package with current mortgagor, we still have to pay a fee!!!! This tenant fee is justifiable just as in new mortgage new credit card deal, new loan, new car lease or renew car lease or extend a lease on car or property. perhaps all these fees by other commercial companies should be ban too?

    David Robinson

    I disagree. A tenancy agreement is a contract prepared on behalf of the agent's client, the landlord. It is a document which the landlord should pay for, be that as a separate charge or included within an agent's overall fee. Yes, it's there to "protect" the tenant, but it is granted by the landlord. Most landlords are in the "business" of letting, so it is to be an expected expense of that business.

     
  • S l
    • S l
    • 06 August 2019 17:39 PM

    If a solicitor draft up the tenancy agreement for the landlord, they then send it to tenants solicitor. So landlord pay for their solicitor and tenant can pay for their own solicitor. similar to conveyance. wont that be better solutions than to claim that all fees be ban and not charge to tenants. eg, inventories, its beneficial to landlord as well as tenants. so shouldnt that be split up in half too? LA showing the tenants various different houses, wont that be a service too? Or should everything either be charge to landlord or a freebie to tenants.? In fact, tenants are jumping with glee they can skoot off without paying for 2-4 months. there is nothing a landlord can do about it. then they ran off to another unsuspecting landlord. The lack of security allows the tenants to be rogue tenants and skip their responsibilities in paying rent and gas water electricity bills and caused damages to property because they know they are still ahead of it as they can run away from it as the government regulations encourage it and who wont take advantage of that?

  • icon

    Lettings agents trying it on. A local agent tried to charge £90 for a 3rd year renewal, actual cost less than £10. With current tenants we dont charge a renewal fee and never have. Local agent against LL request of dont charge still charged but reduced to £50. Refusing to arrange return of Security Deposit of over 5 weeks cap, some £1320 odd pounds until fee of £50 paid.
    The DPS requested a full breakdown of agents fee of £50, which they have not sent yet.
    Flash agent shooting himself in both feet. Twit.

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