Can estate agents still claim fee if we sell house 2 years later?!?

PrincessJR

Hi,

We had our house up for sale with a local agent, who we have now given their 28 days notice to terminate the contract. The 28 day period is up next week at which point we were thinking we would be basically 'free of them'.

I am re-reading the small print and can across this rather disturbing paragraph:


In accordance with the Code of Practice (TPO), following the termination of our agreement, if a purchaser introduced by us or with whom we have negotiated goes on to buy the property through another agency we shall still be entitled to our fee if a Memorandum of Sale (or equivalent) is issued by the other agent within 6 months of the date of termination of our contract and where exchange of contracts takes place. In all other cases we will be entitled to our fee for an exchange of contracts occurring up to 2 (two) calendar years from termination (at the end of the 28 day notice period) of our agreement.

Surely this doesn't mean that if a sale goes through in 2 years time, independently of this agent, that they still get their fee?

Does it refer only to a buyer whom they negotiated with or introduced?

kinger101

I doubt it would stand up in court if the purchase happened two years later. If it happens shortly after you've left the agent, they can make a strong argument they've introduced the buyer, given they've responded to their adverts and booked viewings with them.

It seems rather academic anyway as you've only just taken the property off the market. Do you have a list of names of people who've viewed with the old agent? It's worth handing this to the new agent so they are aware.

eddddy

PrincessJR wrote: »

Does it refer only to a buyer whom they negotiated with or introduced?

Yes.

(As Kinger says, to protect yourself, you can ask the agent for a list of people they feel they have introduced or negotiated with.)

... but it also applies to any buyer introduced by another agent before the 28 days notice is up. So make sure that any new agent does not start work before the 28 days is up.

XKC-Me

I don't think this is as disturbing as you think. Without it, there'd be nothing to stop you having a buyer found, an offer made, and then just telling the buyer that you'll unofficially accept it but not in writing for another month or so - and then cutting out the estate agent. They did the work of finding buyers, they deserve some money if you sell to one of them.

Granted, the agents didn't find every buyer. Some would have found you anyway, some were attracted by the agents' advertising. But you see my point?

davidmcn

XKC-Me wrote: »

I don't think this is as disturbing as you think. Without it, there'd be nothing to stop you having a buyer found, an offer made, and then just telling the buyer that you'll unofficially accept it but not in writing for another month or so - and then cutting out the estate agent. They did the work of finding buyers, they deserve some money if you sell to one of them.

Granted, the agents didn't find every buyer. Some would have found you anyway, some were attracted by the agents' advertising. But you see my point?

I don't think anyone's arguing to the contrary, but the second sentence doesn't refer to buyers they've introduced.

G_M

At the end of the 28 days, ask the agent to provide a list of all buyers they have intruduced to the property.

Don't sell to those buyers in the next 6 months unless

* the new agent who re-introduces them negotiates with the 1st agent to split the fee (get confirmation in writing from both), or

* you increase the sale price to refect the extra commission cost, or

* you factor in the loss from extra commission cost. or

* have written confirmation from the new agent that they won't charge commission if you sell to that list

I don't understand the 2 year clause - makes no sense to me.

PrincessJR

Thanks everyone.

We're actually planning to do some refurb work to the property before putting it back on the market so there is no risk of an overlap with regards to the 28 days.

As of last week we do have a family friend who has said they may be interested, but they heard about it being for sale from us, nothing to do with the agent so if at some point they end up buying, the agents wouldn't have had any input anyway.

G_M

Code of Practice:

Fee Entitlement and Client Liability
5r At the time of accepting instructions from a client, you must
point out and explain clearly to that client in your written
Terms of Business:
• that you may be entitled to a commission fee if that client
terminates your instruction and a memorandum of sale is
issued by another agent to a buyer that you have
introduced within 6 months of the date your instruction
ended and where a subsequent exchange of contracts
takes place.
If no other estate agent is involved this time limit extends
to 2 years.
• and that the client may be liable to pay more than one fee if:
• that seller has previously instructed another agent to
sell the same property on a sole agency, joint sole
agency or a sole selling rights basis; or
• that seller instructs another agent during or after the
period of your sole agency, joint sole agency or on a
sole selling rights basis.
5s At the time of the termination of the instruction, you must
explain clearly in writing any continuing liability the client may
have to pay you a commission fee and any circumstances in
which he may otherwise have to pay more than one
commission fee.
5t Your action in pursuing a commission fee or additional
charges must be proportionate and reasonable and not
intimidatory.

PrincessJR

kinger101 wrote: »

I doubt it would stand up in court if the purchase happened two years later. If it happens shortly after you've left the agent, they can make a strong argument they've introduced the buyer, given they've responded to their adverts and booked viewings with them.

It seems rather academic anyway as you've only just taken the property off the market. Do you have a list of names of people who've viewed with the old agent? It's worth handing this to the new agent so they are aware.

Thank you for replying. No we haven't asked for a list of names - it didn't occur to me to be honest. If a sale happened shortly after the 28 days period, but the agent had no proof that the buyer ever engaged with them then surely they couldn't claim the sale came as a result of their efforts? I'm thinking hypothetically here now as it seems it could be a minefield!

PrincessJR

G_M wrote: »

Code of Practice:

"If no other estate agent is involved this time limit extends
to 2 years"

so if we sell the house privately within 2 YEARS (!?) the previous estate agents could claim their fee? seems crazy

pmlindyloo

PrincessJR wrote: »

"If no other estate agent is involved this time limit extends
to 2 years"

so if we sell the house privately within 2 YEARS (!?) the previous estate agents could claim their fee? seems crazy

No, it doesn't mean that!

The two years is for buyers that were introduced by the estate agent and then went on to buy from you privately - ie. no other estate agent involved.