Ditching A Letting Agent & Tenancy Deposit Scheme

[CW1]

Very long story short, I gave notice to my tenants on 16 March, they're due to vacate on 15 May (only 2 months notice was required), so as far as the letting agent (who Fully Manage the property) is concerned, that's what's happening. The Tenancy Agreement wasn't renewed (as I say, a long story & no need to elaborate here just yet). They're now staying for the foreseeable future, letting agent doesn't know that, but we want to continue the tenancy without the letting agent. My only concerns really are, have I given the letting agent's notice too by default - they know I want[ed] to sell so ties would've been broken in May anyway - & how do I go about getting the deposit transferred to another TDS so the agents have nothing more to do with it.

In the agreement with the letting agent, it says

" 5. In the event the Landlord terminates the Rent Collection and/or Fully Managed Service in accordance with Clause 7.18 of the terms and conditions, a letting fee or balance of such a fee equivalent to 10% of the total rental for the duration of the tenancy and any renewals, continuation or extension thereof will be due from the Landlord to the Agent.

7.18 Termination of Rent Collection and/or Fully Managed

Either party may terminate the Rent Collection Service and/or Fully Managed Service after the first six months of the Tenancy, for any reason, by serving three months’ written notice to that effect. If the Landlord wishes to terminate Rent Collection Service and/or Fully Managed Service prior to the expiry of the three months’ notice, all fees and costs outstanding and due to the Agent for their letting, administration and management services shall become immediately payable."

Wondering what "all fees and costs outstanding and due" might be ... they take their commission at source so far as I know, I owe them nothing.

Would really appreciate any advice ! :)

[Sycamore3House]

You have to give 3 months notice to the property management company and if you do not give the appropriate notice you need to pay any fees that would have been forthcoming whilst you tenant was occupying the property. Only had a quick scan of it but that was the gist I think

[CW1]

So the 3 months minus 1 day I've given the tenants doesn't count ?

As it stands, the letting agent think the tenants are going in May & then I'm selling. That wouldn't be the full 3 months but it's fine, they've made no noises about being reimbursed for the extra month. I only need to give the tenants 2 months notice (as there's no Tenancy Agreement) so if I then sell or re let thru' another agency, the current agent would never get 3 months notice.

Would (could ?) they argue they want an extra months commission even though they think I'm selling so I wouldn't be getting the rent they'd want the commission on?

[Sycamore3House]

You have a contract with the tenants (the tenancy agreement which is usually 6 months and then month to month but still requiring 2 months notice from landlord) and a contract with the letting agents of which you have quoted above that requires 3 months notice. So you need to inform both parties of your intention. As you have given notice to the tenants you now need to do the same with the agents.
The agent is protecting their interest. But you are still free to manage your own property you may have to pay to get out of it.

[CW1]

Sycamore3House, I think where my confusion's coming from is the fact I seem to need to give the agents 3 months as per their agreement with me - is that agreement even still valid as no Tenancy Agreement's in place ? - but the tenants only 2 by law, in the absence of an agreement with them. As far as the agent's concerned, they will have no dealings with me after 15 May, other the inventory & sorting the deposit out. How can they enforce 3 months notice when they won't be agents for long enough ?

I did rent it with a different agency with a previous tenant, who I also gave 2 months notice to (when he stopped paying rent so completely different scenario) & notice to the agent was never mentioned.

[Dogsbody2]

Reading the part of the agreement starting with 5, it strikes me that the purpose of the clause is to prevent you giving three months notice but then continuing to rent to the same tenant but cutting out the agent. Obviously with a different tenant under a new agreement you would have no further liability to the original agent, but that's my reading of the purpose of the clause. Otherwise what is the purpose of clause 5 at all? Clause 7.18 ensures the agent gets his money due to the end of three months.
That's my reading of it - to stop you DIYing the management with an incumbent tenant that the agent originally sourced.

[bednobs]

why don't you ask the LA if you need to give any written notice? if you do, They can easily enforce it by just chrging you for the three months notice you hven't given them.

[CW1]

Agreed, clause 5 doesn't really make sense being there, but it's scary ! 10% of ALL the fees over the duration of the tenancy - ouch !

I haven't asked the letting agent for 2 reasons, for one this has all happened over the weekend so haven't been able to, & secondly I don't particularly want to. There's bad feeling on their part as I didn't use them when I put it on the market, the 1st thing they'll say is "Why, as the tenants are moving out ?", then they're bound to say "Yes" & won't take any notice of the fact notice was given to the tenants weeks ago.

I've e-mailed Landlord Advice UK but their automated reply says "we will respond if a response to your email is appropriate", so I won't know if no reply means they haven't looked at my query yet or they're just not going to ! I will try ring them tomorrow.

[Sycamore3House]

You are breaking a contract with the LA so therefore as with all contracts you will need to pay to get out of it. You should have given notice to the agents (3months) and then a month later to the tenants (2 months).

[CW1]

I wouldn't have been able to do that, Sycamore3House. The tenants gave me notice initially (1 month), then retracted it the following day, despite me having told the letting agent I'd sell as soon as the tenants ever moved out. I immediately told the agent to give the tenants notice (as I'd also told them I wouldn't be messed about). They never did, & never have, said "What about us ?".

[bednobs]

you can't lose anything by asking them - if they do intend to hold you to whtever, asking them is neither going to make it more certin they will, nor persueade them not to!

[Dogsbody2]

I wouldn't do what bednobs suggests. It's just commercially naive and assumes what the agent says must be right. Law ain't like that, it's about interpreting words in agreements against specific situations. You've got to put forward your own interpretation of the agreement words to your advantage in the situation.

But I still think you are looking at it through rose tinted specs. You were supposed to give the agent three months notice in writing and you haven't. I think the agent's purpose in having clause 7.18 is so that if you want the tenant out, you have to give the agent three months notice, even though legally you only have to give two to the tenant. If the tenant gives two months notice when the contract is just rolling on after the initial six months, you would probably be able to terminate with the agent at two months notice.

But none of this applies to you as you and the tenant want to keep the contract rolling, you just want the agent out. That is the purpose of the agent putting clause 5 in. To stop landlords cutting the agent from the loop. I don't think you will get away with this, as it is inconceivable the agent won't find out.

[CW1]

Ok ... just found this in the original Tenancy Agreement ...

"It is hereby agreed between the Landlord and the Tenant that this Agreement may be determined at the end of the said term or at the end of any subsequent month by either party giving not less than two months’ notice in writing to the other party.
** For the avoidance of doubt, the tenant may give such notice to the landlord’s agent. **"

How about the tenant gives the LA notice ?

[CW1]

Actually, after wondering why a tenant would give a LA notice, realised I may have misinterpreted that clause ... thinking now it means they can give to LA who then passes it on to the landlord (as in my case) ... *doh*
Ambiguous though ?

[Dogsbody2]

There are two agreements here. The first is an AST agreement between you and the tenant. That is what you are quoting from immediately above.

The second is a purely commercial agreement, bound by commercial laws such as Unfair Terms legislation etc. This is between you and the agent. The two are not connected.

I had a look at the Landlordzone website which suggests that there is often an expectation in property letting arrangements that an agent, who has once found a tenant, is able to keep maintaining that business until the tenant leaves. That is what I believe the terms of the agent agreement you have signed up to is designed to do. Unless you can claim it is unfair or the agent has breached his side of the agreement, I believe you are stuck with it until the tenant moves out, or you negotiate a break clause with the agent to get out of the agreement. The agent will probably anticipate a number of months compensation of his normal fee to break the agreement and for you to maintain a direct control over the AST agreement and management of the property yourself, if that is what you wish to do.

You really someone like Peter Pedant to confirm my interpretation for you. I hope he finds this thread.

[Dogsbody2]

This is what I'm referring to, CW

http://www.landlordzone.co.uk/content/terminating-a-letting-agents-contract

PP appears to be active on here this morning but hasn't spotted your question, yet.

[CW1]

I had seen that page, Dogsbody2. I still don't get how I could have possibly given the agent 3 months notice in this situation when I only needed to give the tenants 2. Surely they should've let me know that when I e-mailed them on 16 February (NOT March ! *doh*) to give the 2 months notice to the tenant ?

Oh, & I rang the advice line. "£50 first please" ... :/

[CW1]

I've ended up e-mailing the letting agent, this is their reply ...

"The fact that the tenancy will come to an end on 14th May 2016 due to the two months’ notice you gave the tenants (after they retracted their notice), means that unless you wish [us] to re-let the property for you then yes, the contract between you and us will come to an end on 14th May."

If I renew the tenancy on 15 May with a new AST contract, am I off the hook ?

[CW1]

Should've said, with a new AST between the tenants & myself ...

I've since found out too, the tenants couldn't retract their notice without my agreement. Faux pas by the agent, methinks ...

[Dogsbody2]

Well done, looks like you've cracked it.

However I'm not sure that they've clocked their own clause 5, but you have the letter today which you can now waive around at them later "but you said here ...."

Just play back their words back at them in your reply. "I confirm I do not require you to 're-let the property for me after xxx May 2016".

I think they've made a mistake, but to your advantage.

[Dogsbody2]

That doesn't say you are not reletting the property. It just says You don't require them to relet the property.

Lawyers get paid good money for constructing appropriately crafted words, but you've DIY.