Fair or Unfair clause?

grwiffen

I have been marketing my Mothers home for 5 months and am very unhappy with the agency. Despite speaking with them,, nothing has improved and I am changing agents.

I have a clause in the contract that says:

"Please note: If you terminate this agreement and later sell your property to a purchaser outlined above your liability to pay our commission only extends for (a) 6 months from the date of termination where another agent becomes instructed or (b) 2 years where no other agent is involved.”

This seems wholly unfair. If the agency has done nothing to introduce the person found by the 2nd agent, why should I pay the first agency fees?

Can anyone suggest a way around this please? Any legal basis for challenging this?

They are a member of The Property Ombudsman, who say they try to avoid dual-fee scenarios, but this just seems immoral on the part of the first agency.

Thanks for your thoughts and input.

Wonka_2

grwiffen said:

I have been marketing my Mothers home for 5 months and am very unhappy with the agency. Despite speaking with them,, nothing has improved and I am changing agents.

I have a clause in the contract that says:

"Please note: If you terminate this agreement and later sell your property to a purchaser outlined above your liability to pay our commission only extends for (a) 6 months from the date of termination where another agent becomes instructed or (b) 2 years where no other agent is involved.”

This seems wholly unfair. If the agency has done nothing to introduce the person found by the 2nd agent, why should I pay the first agency fees?

Can anyone suggest a way around this please? Any legal basis for challenging this?

They are a member of The Property Ombudsman, who say they try to avoid dual-fee scenarios, but this just seems immoral on the part of the first agency.

Thanks for your thoughts and input.

Not sure whether anyone can tell you without knowing what the ‘outlined above’ says 

user1977

We can't see the whole contract - what does "a purchaser outlined above" mean? I'm guessing it is referring to purchasers actually introduced by the agent.

MyRealNameToo

You want us to guess what "outlined above" actually says?


Its a very common clause and its "fairness" will depend on what above states. Generally if its people they have done a viewing for then yes it's fair. If it's anyone on their mailing list then it possibly isnt. If you do instruct a new agent then the old agent should give the new agent a list of the people inscope of the clause which the new agent will consider if one of these people come back to them

gm0

Linked to a definition of "proceedable buyers introduced by the agent for the listed property during the contract".  It's reasonable.  Ish.  A year would be on the short end as a long stop. Given how long things can take in England.  2 years is a bit long.  But we are quibbling about adding or knocking off a few months only. 

Sellers take houses on and off kite flying after too high a price and dithering about moving

Sellers are ALSO known to conspire with buyers to avoid paying and think themselves clever for doing so. So terms exist to hobble this.

Say an agent markets property and introduces a potential buyer.

Who don't conclude matters quickly with the seller.  Seller lapses their agency agreement. Doesn't start another one. Then sells to that same (agent introduced) person as a "private buyer".  No fee.  
Buyer may take a lot of the time required to run out a contract to sell their own and build up a full chain.  Seller and buyer need to be very trusting of intentions to pull this off. With nothing committed pre-exchange.

But this clause makes that agent abuse "pay no commission" trick more difficult to execute.  Which is why it is in there.

Of course (some) agents try and keep the definition of who is an introduced buyer as loose and encompassing as possible.  And can be sloppy about transferring lists to a new agent in an agent switch scenario.  Resulting in two bills arriving and a dispute.

Nobody much likes agents as a collective.  But barking up the wrong tree.

mjm3346

Presumably you went sole agent for a reduced commission rate and something like that is not uncommon for sole agency

saajan_12

grwiffen said:

I have a clause in the contract that says:

"Please note: If you terminate this agreement and later sell your property to a purchaser outlined above your liability to pay our commission only extends for (a) 6 months from the date of termination where another agent becomes instructed or (b) 2 years where no other agent is involved.”

This seems wholly unfair. If the agency has done nothing to introduce the person found by the 2nd agent, why should I pay the first agency fees?

.

Perfectly fair if the 1st agency did introduce the purchaser, just the sales progression was done later. Is that what 'outlined above' refers to? 

grwiffen

The contract staes:

“Sole Agency means you will be liable to pay remuneration to us in addition to any other costs or charges agreed, if at any time unconditional contracts for the sale of the property are exchanged with a purchaser:-
 Introduced by us or any other jointly appointed agent during our period of sole agency; or
 Whom we had negotiations with about the property during that period; or
 Introduced by another third party agent during that period.

I have no issue if one of their introductions comes back later. I have a definitive list of those and told the new agency not to deal with them. But this is highly unlikely as we've had so few and they all moved onto other properties.

My issue is that they want commission for 6 months after termination, under any circumstance, whether another agent finds a new buyer or we do. This seems very unfair.

MyRealNameToo

grwiffen said:

The contract staes:

“Sole Agency means you will be liable to pay remuneration to us in addition to any other costs or charges agreed, if at any time unconditional contracts for the sale of the property are exchanged with a purchaser:-
 Introduced by us or any other jointly appointed agent during our period of sole agency; or
 Whom we had negotiations with about the property during that period; or
 Introduced by another third party agent during that period.

I have no issue if one of their introductions comes back later. I have a definitive list of those and told the new agency not to deal with them. But this is highly unlikely as we've had so few and they all moved onto other properties.

My issue is that they want commission for 6 months after termination, under any circumstance, whether another agent finds a new buyer or we do. This seems very unfair.

Its not particularly well worded but I am guessing its already been executed and you are already with another agent and so well past the time you should have read it and questioned it. 

Have they actually asked you for payment or have you not actually got an unconditional contract exchanged yet? 

I'd assume the third bullet is intended that the "during that period" refers to the period whilst they are supposed to be the sole agent and therefore doesnt apply to a third party agent that are instructed after the agreement is terminated but its not well written and id have got it sorted before agreeing to it. 

grwiffen

Current situation is we are looking to move to a new agent. We do not have a buyer yet and no contracts are due to be exchanged, so they havent asked yet for any fees.

Yes, we should have questioned this at the time, but were told it was a take-it or leave-it contract and 'industry standard'. 

The third bullet covers any sale, from anyone for the next 6 months .... ie after they have been terminated.

eddddy

grwiffen said:

My issue is that they want commission for 6 months after termination, under any circumstance, whether another agent finds a new buyer or we do. This seems very unfair.

I can't see the whole contract, but I assume that a "purchaser outlined above" means

...a purchaser:-
 Introduced by us or any other jointly appointed agent during our period of sole agency; or
 Whom we had negotiations with about the property during that period; or
 Introduced by another third party agent during that period.

And you say that the estate agent has given you a list of those people.

So in simple terms, if you sell to anyone on the list you've been given within 6 months or 2 years (as appropriate), you have to pay the old estate agent a fee.

You've told the new estate agent not to deal with the people on that list - so it sounds like you are 100% covered against double fees.



The above are requirements specified by the Property Ombudsman, and appear in almost all estate agents' contracts.