The Association of Residential Lettings Agents has taken legal advice on what can be charged to tenants for so-called ‘contractual damages’.
ARLA says it’s been contacted by many members with queries about whether these charges can be levied on tenants given the Fees Ban.
The answer is not contained within the Government Guidance issued earlier in the year and therefore ARLA has sought Counsel’s Opinion.
A statement from ARLA, passed to Letting Agent Today last evening, says the question was: "When a tenant has caused damage which has required the landlord to remedy the issues (such as blocking a toilet by flushing nappies down it) and the landlord instructs their agent to arrange the works, can the landlord pass on the agents’ commission as well as the actual costs of the repair."
ARLA says that in the opinion of a barrister, Erol Topal - a respected authority in housing law - such a charge will be against the spirit of the legislation but may be possible if there is a clause in the AST making this clear to the tenant when they 'enter the agreement'.
ARLA continues: “However, such a clause may be subject to challenge under consumer protection legislation and, if successful, would be deemed an unfair term which could result in the agent having the clause struck out by a court (and this not being able to recover anything) and be liable for a penalty under the Tenant Fees Act 2019.
“Therefore, whilst agents must make their own commercial decisions on how to take this issue forward, ARLA Propertymark is NOT recommending this course of action and as such will NOT be making any changes to its ASTs.”
You can see the 19 page legal opinion here.