Sole agency agreement

park001

We are currently selling our house, we signed a sole agency agreement with a local company and had a buyer through them who pulled out of the purchase when covid 19 struck.
 I contacted the people whose house we were buying to let them know the situation, the house we are buying is a new build I have been working on for the last few months.
Later the same day they called and offered to take our house in part exchange which we accepted.
we contacted the agent to notify them we had a private buyer and could they take our hose off the market.
the reply was that’s great but you still owe us our fees and will not back down telling us to seek legal advice.
we were on the understanding we could sell privately and would not  be liable for the fees.
Below is the wording of our contract if anyone can shed any light on it we would be very grateful.

Entitlement to fees:

 You will be liable to pay remuneration to us, in addition to any in other costs or charges agreed, if at any time unconditional

 contracts are exchanged and completion takes place:

• With a purchaser introduced by us during the period of our agency agreement or

 • With whom we had negotiations about the property during our contractual period or

 • With a purchaser introduced by another agent during the period of our sole agency.

 • If you have given us Sole Agency or Joint Agency and have instructed another agent who is not instructed at the

  same time as us to sell the Property at a later date

  This includes any purchaser subsequently buying privately or through another estate agent

even if the property has been

 withdrawn from the market. We will be entitled to our fees if you terminate our instruction and go on to sell your property

 through another estate agent, to a buyer that we have introduced within six months of the date of our instruction ending. If no

 other estate agent is involved this time limit extends to 2 years. In the case of a part exchange situation, our fee will be based

 on the full selling price, not the differential

Greatgimp

I wouldn't pay them a penny as they didn't in this case have 'sole selling rights'.

Flim

This has been asked before, and I think you will find that you are still obliged to pay their fees...

Greatgimp

Flim said:

This has been asked before, and I think you will find that you are still obliged to pay their fees...

Please explain the reason behind this.

greatcrested

If you have given us Sole Agency or Joint Agency and have instructed another agent who is not instructed at the

  same time as us to sell the Property at a later date

  This includes any purchaser subsequently buying privately or through another estate agent

This appears contradictory.  On the one hand it says "sole agency or joint agency" (not sole selling rights). On the other hand it says "includes any purchaser subsequently buying privately".

Please confirm the exact wording, section headings, and context.

Please also confirm which option is ticked or crosed out,or what was written in as the basis of the contract eg "sole agency" or "joint agency" etc and where this appears in the contract.

park001

Thanks for the replies, that section was copied and pasted from our contract under the heading Entitlement to fees, we understood “ this includes any purchaser subsequently buying privately or through another agent “ as someone they had introduced to the sale. This is copied and pasted from the first page of our agreement. This is a legal document which contains our terms and conditions and forms a contract between us. It is your instruction to us to market your property for sale. Please read it carefully before signing. You have instructed us to sell the above property from 17th February 2020 on a Sole Agency basis of which the fees are set out below,

eddddy

I suspect you've copy/pasted the contract text from a PDF which has introduced random line breaks, which makes it very hard to follow.

Anyway, it seems to boil down to the definition of an "Agent" and whether an "Agent" introduced you and the developer.

• If the developer uses an "Agent" to sell their properties and arrange part-exchanges - then arguably an "Agent" introduced your property to the developer, and you have to pay a fee to your EA.

• If you dealt with the developer direct (and no "Agent" was involved in the introduction) - then you probably don't have to pay your EA a fee

 

Edit to add...

If the EA refuses to budge, you could do nothing and see if the EA takes you to court - but it might be better for you to get in first and complain to the Property Ombudsman (assuming that the EA is a member of the Property Ombudsman Scheme).

The Ombudsman is more biased towards consumers than a court would be. And EA members are bound by their decision. 

park001

Hi  my copy and pasting abilities are limited I know, the house I am buying is a self build and has never been on the market so no agent involved there in fact our agent has no idea of the house we are trying to buy. I think we may have to pay the fees and like you say take it up with the ombudsman after which they are a member.
It raised the stress levels very high when they advised me to seek legal advice.

pinkshoes

Surely as you are not selling the house but using it as a deposit in a part exchange, then no fee would be due?!?!

park001

The contract says that if part exchanged the fees are due on the value of the house not the difference.

eddddy

park001 said:

Hi  my copy and pasting abilities are limited I know, the house I am buying is a self build and has never been on the market so no agent involved there in fact our agent has no idea of the house we are trying to buy. I think we may have to pay the fees and like you say take it up with the ombudsman after which they are a member.
It raised the stress levels very high when they advised me to seek legal advice.

OK - so it seems pretty clear that no fee is due to the EA.

And don't pay the fee - complain to the Ombudsman first.

park001 said:

The contract says that if part exchanged the fees are due on the value of the house not the difference.

Just to be clear...

The contract essentially says, if an agent introduces a buyer, then....'if part exchanged the fees are due on the value of the house not the difference.'

Since the buyer wasn't introduced by an agent, that sentence is irrelevant.


From what you say, the EA is just taking a punt, and hoping to bluff you into paying.