Query on Estate Agent Fees....

nerdycatlover

Hello, All.
New to this , so please excuse if I mess up. We`ve got in a bit of a muddle selling a small bungalow left to us in a will. Put it up for sale with local Estate Agents (Sole Agency) who sent several people to view.The time limit ran out and we found that they had cocked up the Rightmove Ad and it was listed as a House, not Bungalow....Anyway, we had no offers, so we went with another Agent who found us a buyer and we accepted the offer. My solicitor somehow told the first Agent the name of our prospective buyer and it turns out that they viewed it with the first Agent.(We never met them, the Estate Agent showed them round...) Now Both the Agents want their fees, which would amount to £8000 on a £153,000 property.The second Estate Agent must have known that the buyer had been to the First one because , it turns out that they are a close relative of a member of their staff. This seems fundamentally wrong to me, but I can`t see a way round it, other than taking the place off the market and letting it until maybe the prices pick up ? I feel I have been set up by both of them and so far they refuse to negotiate with each other over a fee, or either of them back down. Any views? Any Estate Agents out there?Looking fwd to your replies....
Ta Very Much.

lincroft1710

£8K on a £153K property??? So they want £4K each? Usual EA fees are about 1 to 2%.

bookduck

I'd ask the solicitor since he divulged privileged information.

How do you actually know the first agent brought them around to your property, where is the proof?

I'm Sure when other EA on this site see this they will have brought him around to your property too

All sound fishy

cats!

Don't worry! Recent Foxtons court case ruled in favour of the vendor - a legal precedent has been set!

Courts ruled Foxtons were not entitled to their fee even though they had shown the buyer round first. Second agent got the commission 'cos they had provided a buyer willing to proceed to exchange (i.e. make the purchase).

Check the wording in your contract.

Your solicitor has been negligent, no doubt about that. First agent should have provided a list of those who viewed anyway. Bet they haven't got any proof??

Don't worry, Foxtons losing in court have down you a favour!

Complain to the Law Society about solicitor and instruct a new one to tell the first agent to bog off! If not, see you in court then!

nerdycatlover

With regards to our solicitor, when we asked why he told EA No 1, his only reply was that if we had a complaint, to put it in writing!!!!! Don`t think we`ll be using him much longer. To be fair, he was incredibly cheap to do conveyancing, but we thought it was just a simple sale with no chain.
Thanks for Foxtons info, will bear it in mind.
To BOOKDUCK,
We believe that they did originally send the same people to view, but the property was at a higher price at that point and they weren`t interested.

redcar_2

nerdycatlover wrote: »

With regards to our solicitor, when we asked why he told EA No 1, his only reply was that if we had a complaint, to put it in writing!!!!!

Well at least he provides sound advice... I would do as he says, copied to his professional body / regulator...

nerdycatlover

Latest Update: We phoned the Ombudsman on the advise of one of the Estate Agents and all they said was that, not withstanding the Foxtons case, we will be liable to pay BOTH the Estate Agents their whole fees because that`s what it says in their contracts.All we could do is fight it through the courts, and quite frankly we can`t afford to risk it and have to pay everyone and the court charges.I`d say, "Let that be a lesson to you all", except I don`t know what else we could have done.You don`t ask everyone viewing your property if they`ve been through another agent months before. Maybe the people in the Foxtons case could afford to go to court, it was a £million + property.
Anyone want to rent a nice little bungalow?????

chickmug

nerdycatlover wrote: »

Latest Update: We phoned the Ombudsman on the advise of one of the Estate Agents and all they said was that, not withstanding the Foxtons case, we will be liable to pay BOTH the Estate Agents their whole fees because that`s what it says in their contracts.All we could do is fight it through the courts, and quite frankly we can`t afford to risk it and have to pay everyone and the court charges.I`d say, "Let that be a lesson to you all", except I don`t know what else we could have done.You don`t ask everyone viewing your property if they`ve been through another agent months before. Maybe the people in the Foxtons case could afford to go to court, it was a £million + property.
Anyone want to rent a nice little bungalow?????

This below is taken from the OFT's own web site press release. Link also below - so are the OFT people you spoke to up to date with their understanding of the position? Also is either or are both EA's members of the NAEA another body to complain to with their web site link also below:

http://www.oft.gov.uk/news/press/2008/81-08

http://www.naea.co.uk/tools/contact.asp

The OFT is drawing consumers' attention to a recent Court of Appeal ruling that affects 'sole agency' contracts with estate agents.
The recent court case ruled that estate agents cannot claim their commission under a 'sole agency' agreement unless they can show that they have introduced the buyer to the purchase, and not just to the property.
In the case of Foxtons v Bicknell in April this year, the Court of Appeal decided that Foxtons was not entitled to a £20,000 fee after a buyer it had originally introduced to a property but who decided not to purchase the property at the time, then went on to buy the property at a later date through another agent.
The court decided that 'introduced' meant introducing a buyer to the 'purchase' and not just to the 'property'. In this particular case, the buyer had made it clear to Foxtons that she was not interested at that time in buying the property and therefore Foxtons could not claim their fee.
Mike Haley, OFT Head of Consumer Protection, said:
'It remains the case that sellers who sign a 'sole agency' agreement with an estate agent could be liable to pay the agent their fee even if another estate agent ends up selling the property. This Court of Appeal decision helps house sellers and estate agents understand more about the circumstances where this might or might not be the case.'

vickyb242

Hi,

I am in the same position but from the buyers point of view. I saw a property with first EA, made an offer, after serveral negotitaions finally agreed on price. Kept getting calls from EA saying that other people were now interested and were putting in a higher offer, after 3 weeks of messing about finally told the EA to bog off and sell it to someone else as i couldn't keep uping my price. Then a week later second EA called me and asked if i would be interested in seeing this house, it was the same one! I explained the situation to the second EA and he explained that it was now to difficult for him to proceed with me as the seller would have to pay 2 lots of fee's, as the first EA introduced me to the property (never met the seller though).

Me and OH have made the fatal error of falling in love with the property and because it was such a bargain (320k reduced to 240k) we now cannot let it go. I have been given the advice of going round to see the seller and explain to him that i am serious in buying the property??? What do you guys think? Can you go round and see the seller?

Thanks

redcar_2

OP If you are seriously thinking of walking away rather than pay two lots of commission - which I wouldn't balme you, can you not put this to the two sets of agents. You can say to them that as it stands neither will be getting the commission as you will have to walk away and I would have thought that the way things are they would try their hardest to try and broker some form of arrangement that is amenable to you and them.

I would have thought from what people have said about the Foxton's case that your latest EA should get the whole commission but if they want that then they should be able to advise you what the last lot handed over in terms of a claim on previously introduced parties.

As a general question is there nothing in a contract about an agent sending round people they know they have viewed before with a prior agent as they'd know where it was all heading anyway?

jimc_2

nerdycatlover wrote: »

we had no offers, so we went with another Agent who found us a buyer

Because your buyer DID tell the previous agent they weren't interested, it DOES fall under the same circumstances as the Foxton's case. Try printing out that OFT quote and take it to the first agent to try to shame them into backing down. Consider making a threat of a complaint to the local trading Standards office on the basis of flying against OFT advice. It may work and doesn't cost you anything to try.

It's too late to advise the OP now but this case raises a serious and common Agent malpractice when they lose an instruction. There have been far too many attempts to claim 'first agents' fees when another person or agent subsequently sells the property.

This is a scandal easily avoided by the first agent declaring an 'interest' in the form of a list of people they have introduced and therefore believe would be liable to the fee. This could be given to the second (or subsequent agent) so they would know to avoid them or come to their own arrangement with the first agent about commission if the prospective buyer came back.

Why this is not already the law I do not for the life of me know, because the present position is 'double jeopardy' for the seller without it!

The best advice to Moneysavers is to 'close out' the first agent properly. Don't just walk away. There is advice and a draft letter here to end the first agent's interests and to safeguard sellers.