2 Estate Agents claiming sellers fees

wendyrobson

After 12 months with property for sale with one agent I moved it to another agent. Within weeks accepted offer and solicitors appointed etc.
Now 3 weeks later the first agent inform me that they showed the property to this buyer 2 weeks before the agency changed. The buyer did not inform 2 Nd agent of this and of course we had no idea as the buyer did not make any offer following first viewing.
Both agents now claiming introduction fee. 2 Nd agent willing to reduce to half but first agent demanding full fees.
I,m sure that legally they would both be able to claim but I am piggy in the middle of something not of my doing.
Has anyone come across this before. Don,t really want to lose the sale at this stage but not happy with two sets of fees either.

PasturesNew

Normally EA1 provides a full list to you that you pass to EA2, if you tell them you're changing agents.

In a small, local, area, where they all know each other, they're used to this and all work together so you only pay one set of fees and everybody knows from the start who did the introducing.

Did you tell them? Did you ask for a list or did they send you one?

It all comes down to the wording in YOUR contracts.... dig them both out ... and find the relevant sections, then type word for word what each says.

wendyrobson

Both agents new I was changing but None ever suggested a list. I did specifically tell agent 2 not to allow viewings to anyone who agent 1 had shown, in fact I knew of one lady in particular and I provided her details to agent 2.

It is a small town and both agents know each other and in fact have spoken to each other. Agent 1 says agent 2 should withdraw their charge. Agent 2 says no but will reduce.

All this is happening whilst I am in France which adds to the difficulty.i will check the contracts when I get home but I was aware that agent 1 could claim fees if they had introduced the buyer.i think agent 2 should have asked the question but obviously didn,t.

I do wonder who informed agent 1 about the buyer. Hopefully the agents are not acting together but it must have been someone in the now.it wasn,t the buyer and it wasn,t me. Anyway thankyou for your reply.

kinger101

You need to check the wording of the contract signed by Estate Agent number 1, with regard to continued liability.

There should have been a double commission warning stated within there somewhere too. It's rather bad form that they did not provide a list of viewers when the agreement with them was terminated.

Find out from the buyer when they decided to purchase the property; i.e., after viewing with EA1, or after viewing with EA2. This could have some bearing on whether EA1 are entitled to any commission.

Foxtons v Hamptons (2008)

http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWCA/Civ/2008/419.html&query=foxtons&method=boolean

Not a short read, but the jist of it is that the introduction by EA1 needed to be the effective cause of the sale.

Annie1960

http://www.tpos.co.uk/downloads/TPOE27-1%20Code%20of%20Practice%20for%20Residential%20Estate%20Agents%20(Effective%20from%201%20August%202011).PDF

Think yourself lucky you have discovered this before exchange.

The above link is to the Ombudsman Code of Practice. See para 3q in particular.

The fee in this case belongs to the first EA. The second EA should have explained the possibility of a double fee to you, and should have asked you for a list of names of people introduced by EA1.

If a person then approached the second EA, they should have been referred back to the first EA.

Tell the second EA you will be putting in a complain to the Ombudsman if they do not either:

-come to an arrangement with EA1 to chard the fee, or

-drop their claim for a fee entirely.

They should be negotiating this between themselves, not with you. If you spend some time going through the Ombudsman website, you will see the Ombudsman comes down quite hard on EAs who try to charge double fees.

EDIT: The other thing to think about is whether EA1 and EA2 did things differently, e.g. was the price the same?

googler

Annie1960 wrote: »

The fee in this case belongs to the first EA. The second EA should have explained the possibility of a double fee to you, and should have asked you for a list of names of people introduced by EA1.

If a person then approached the second EA, they should have been referred back to the first EA.

'referred back' for what? The first EA no longer has a valid contract to sell the property, so they're in no position to accept an offer on the seller's behalf..... Their contract to act on the seller's behalf has been terminated.

And without any real evidence that they were the cause of the sale, as per the Foxtons case.....

PasturesNew

googler wrote: »

'referred back' for what? The first EA no longer has a valid contract to sell the property, so they're in no position to accept an offer on the seller's behalf..... Their contract to act on the seller's behalf has been terminated.

And without any real evidence that they were the cause of the sale, as per the Foxtons case.....

A lot of contracts say that people they showed round "belong" to them for 6 months, even if they don't then deal with the sale (as they might not know about it). This is why a definitive list is essential.

wisspa01

The same thing happened to us. We gave notice to the first EA and told them we wanted to try another EA. All went well and we signed up to the new EA. One set of viewers came round and I recognised them and they made an offer which we accepted. At no time did the new EA mention that the 1st EA would be entitled to their fee when we told them the purchasers had come through the other EA. I had heard of this happening, mentioned it to my husband and we checked the paperwork and sure enough there it was in writing. If we were to change EAs and a buyer that was introduced by the first EA made an offer which led to completion within six months of cancelling the contract with the first EA, we were liable to pay both fees. Not only that, if we subsequently sold the house to a buyer without EAs involved to a purchaser previously introduced by the EAs, that period was extended to two years!

Spoke to 2nd EA who said and I quote, "I do not want to share the fee, we did the work". He sent a letter to us confirming what he said and also stated that "he would not see us out of pocket". We rang him several times stating we were not happy with the situation and suggested that he share the commission. His answer was always no. Unfortunately, the onus would have been on us to pay both fees. Even though we had his letter, it was of little comfort as I am sure it would have ended up with us being pursued for the fee in court and we would have had to take the 2nd EA to court to get reimbursement. Not sure whether we would have been successful anyway. This was not what we envisaged selling our house. In the end I rang the 1st EA and told them that the offer we accepted came from a couple that they had introduced and that the 2nd EA flatly refused to discuss sharing the fee with them. They rang the second EA and then came to an agreement to split the fee 50/50. The second EA was clearly unhappy about our speaking to the first EA and we noticed a marked change of attitude toward our sale. The sale fell through and we came off the market thoroughly disillusioned with the whole process. We recently put our house on the market with a different EA, paying a slightly higher fee and sold our house within 24 hours. Needless to say I kept all the lists of previous viewers to be on the safe side. Even if the EA does not provide a list of viewers, I would strongly advise anyone to keep their own list and read the contract before you sign, especially the very small print.

If it were me I would threaten to pull out and then see what arrangement the two EAs come to.

Annie1960

googler wrote: »

'referred back' for what? The first EA no longer has a valid contract to sell the property, so they're in no position to accept an offer on the seller's behalf..... Their contract to act on the seller's behalf has been terminated.

And without any real evidence that they were the cause of the sale, as per the Foxtons case.....

The EA does still have a valid contract to continue the process of selling to anyone they introduced while the contract was originally in force. This contract lasts for 6 months beyond the termination date.

Don't take my word for it, go and check it out on the Ombudsman's website.

Edit: The Ombudsman places the responsibility on the second agent to explain this to the vendor.

Annie1960

wisspa01 wrote: »

Spoke to 2nd EA who said and I quote, "I do not want to share the fee, we did the work". He sent a letter to us confirming what he said and also stated that "he would not see us out of pocket". We rang him several times stating we were not happy with the situation and suggested that he share the commission. His answer was always no. Unfortunately, the onus would have been on us to pay both fees.

You should have made a complaint to the Ombudsman, who does not like vendors paying two sets of fees.

googler

Annie1960 wrote: »

The EA does still have a valid contract to continue the process of selling to anyone they introduced while the contract was originally in force. This contract lasts for 6 months beyond the termination date.

The ombudsman website doesn't define any agent's contract for them. A provision in EA1's contract that they wish to claim a fee if the OP sells to someone introduced by them is not the same as having a valid contract to accept an offer, and continue to act for the seller thereafter. EA1 would have stopped marketing the property, too, because they no longer have any selling rights.