Help re tenancy agreement

[planetparker]

Hi

 

I admit I am a fairly inexperienced landlord, I only started renting out my house a year ago. As I had never done this before I decided to use an agent to draw up the agreement, particularly as I was re-locating several hundred miles away and it was going to be logistically difficult to manage things myself.

 

I found some tenants who seemed very nice via gumtree, and I agreed verbally to rent the house to them for two years at a given rent. I then instructed the agent to draw up an Assured Shorthold Tenancy Agreement, with an intial fixed term of twelve months which would be renewed to run for the full 2 years, or longer if they wanted.

 

The agent drafted the agreement, emailed it to me, I approved it and sent it back duly signed.

 

The tenants moved in, and some problems have arisen which I won't go in to here, but I was (and am) still happy for them to renew the contract which expires on the 9th March. I called them to let them know that the contract needed renewing, and to my great surprise they informed me that the contract they signed was for 2 years, not 12 months!

 

I contacted the agent about this, and he has sent me a copy of an agreement which is signed by the tenants and the agent for 2 years. I have never seen this contract. They obviously changed it without my knowledge, and never bothered to either send me a copy or even inform me.

 

So, my question is to anyone who can advise on such matters, if the agent and/or the tenants changed the terms of the agreement without my authorisation, and bearing in mind my signature is nowhere to be seen on the 'other' version of the agreement, is it legally binding on me?

 

I wanted to introduce a small rent increase for the second year, but the contract they have prevents me from doing that. I have copies of emails between myself and the agent telling him what terms to put in the contract i.e. 12 months, but he did not follow my instructions.

 

Many thanks

[danielr]

I think that the contract would have been ongoing for so long now that you'd have deemed to have agreed to it.

 

and I agreed verbally to rent the house to them for two years at a given rent.

 

I wanted to introduce a small rent increase for the second year, but the contract they have prevents me from doing that.

I suppose that verbal contracts are hard to prove and easy to get out of, but you already said that you promised the house to the tenants for 2 years at a given rent, and then you say that you want to raise the rent, so you'd be breaking an agreement you already made with the tenants.

[planetparker]

The verbal agreement was superseded by the written agreement - and the written agreement I signed was changed by the agent and tenants. If I wasn't aware of the change I don't see how I can have agreed to it?

 

I am not disputing the tenancy itself, but the fact that the term of the contract was changed by other parties.

[MrShed]

The agent is your legal agent, and legally acts on your behalf.

 

As such, the agreement is legally binding.

 

You could however have a case against the agents if they acted against your explicit wishes.

 

Did you have a written contract with the AGENTS?

 

How did the discussion go with them regarding the term of contract?

 

Are they a member of ARLA or another professional body?

 

The case by the way would NOT be to terminate the contract or impose a rent increase after 1 year, but rather to sue the agents for your actual financial loss due to the differing contract.

 

It may be very difficult to prove such a loss however, as there is no guarantee the tenants would have renewed at increased rent.

[planetparker]

Hi MrShed,

The agent is your legal agent, and legally acts on your behalf.

 

As such, the agreement is legally binding.

 

You could however have a case against the agents if they acted against your explicit wishes.

 

Did you have a written contract with the AGENTS?

 

How did the discussion go with them regarding the term of contract?

 

Are they a member of ARLA or another professional body?

 

The case by the way would NOT be to terminate the contract or impose a rent increase after 1 year, but rather to sue the agents for your actual financial loss due to the differing contract.

 

It may be very difficult to prove such a loss however, as there is no guarantee the tenants would have renewed at increased rent.

 

I do have a written agreement with the Agent, which I have just checked. In it I clearly indicated by ticking a box that the initial tenancy agreement should be for 1 year! Also, there is a clause that says the agent will 'Negotiate the terms of the tenancy between yourself and the tenant and ensure that an appropriate tenancy agreement and notices are prepared and signed by or on behalf of the landlord and tenant."

 

So they can sign on my behalf, but the agreement should be appropriate which I take to mean should comply with my instructions.

 

The agent is not a member of ARLA, but is a member of something called the Property Ombudsman - is this worth anything?

 

Thanks for all your help.

[MrShed]

In the first instance, I would write a short but polite letter to the letting agent.

 

In it, I would outline that they have acted outside of your explicit wishes, as laid out in writing.

 

As a direct result of the actions, you have lost X due to inability to raise the rent by X after the first years tenancy.

 

Ask that they reimburse this.

[lawdoctor]

MrShed is right and you should follow the road signposted by him.

 

In addition or should that route not provide the required dividend I was pleased to see that the agent is a member of the Propperty Ombudsman Scheme. It is not compulsory for letting agents to be a member of this scheme which was introduced under the Estate Agents Act 1979 as The Consumer, Estate Agents and Redress Act 2007. The scheme is compulsory for residential sales as of the 1st October 2008. I have copied the ombudsman's lettings complaints procedure below for your convenience.

 

Should you not achieve satisfaction from the agent, suggest to them that you will register a complaint with the ombudsman. This service is free to you and the ombudsman can award compensation to which the agent would be bound.

 

LETTINGS COMPLAINTS INFORMATION:

 

Make a Complaint | Lettings

 

 

 

Downloads:

Complaint Form (Word)

Complaint Form (pdf)

Guidance for Complainants (pdf)

Complainants Charter (pdf)

If possible, please submit your case in typewritten form.

Articles on this page:

What will the Ombudsman do?

What cases can the Ombudsman deal with?

What complaints cannot be dealt with by the Ombudsman?

What happens when you receive my Complaints Form?

What if the Agent has made an offer?

What level of proof do I need to provide?

How will the Ombudsman judge my complaints?

What happens if the Ombudsman supports my complaint?

What if the Ombudsman does NOT support my complaint?

What if I do NOT agree with the Ombudsman's decision?

If the Ombudsman supports me, what can he do?

What happens if I accept the Ombudsman's award?

Can I accept the award and still go to court?

What if I don't accept the Ombudsman's Decision?

Do you publicise case reviews?

What about the agent's fee?

See also:

Consumer Guide | Lettings

Code of Practice | Lettings

Also related:

Make a Complaint | Sales

 

What will the Ombudsman do?

 

The Property Ombudsman will look into your complaint to see if he can resolve your dispute in full and final settlement. Sometimes, it may be possible to do so by mediation by helping you and the agent towards a settlement that you can both agree on. Mostly, he will examine both sides of the dispute and arrive at a written decision. Where he supports your case, he may also consider an appropriate award of financial compensation.

Any award that the Ombudsman makes in your favour is to compensate you for any disadvantage you may have suffered that he feels that you deserve. It is not to punish the agent. The Ombudsman has no remit to impose punitive fines on erring letting agents. He is not a Regulator.

The Ombudsman will seek to resolve your dispute with the agent which may involve making an award of financial compensation where appropriate and if you accept his award, you do so in full and final settlement of your dispute.

What cases can the Ombudsman deal with?

 

The Ombudsman can consider complaints from both landlords and tenants, if you believe that the agent has:

• Infringed your legal rights; or
  
• Failed to follow the rules and obligations for letting agents under the TPO Letting Code of Practice or any internal rules, procedures or statements of practice of the member; or
  
• Treated you unfairly; or
  
• Been guilty of maladministration (including inefficiency and undue delay)
  

in a way that results in you losing money or suffering avoidable aggravation, distress and/or inconvenience.

However, even though we have accepted your complaint, it may be that, on further examination, it concerns something that we cannot deal with.

What complaints cannot be dealt with by the Ombudsman?

 

Broadly speaking, the Ombudsman cannot deal with your complaint if:

• Your complaint is against a letting agent who is not a member of the TPO Scheme
  
• Your complaint is being, or has been, dealt with by a court or similar body
  
• Your complaint refers to something that happened before the letting agent was a member of the TPO Scheme or more than 12 months before you complained in writing to the letting agent
  
• You refer your complaint to the Ombudsman more than six months after the date of the letting agent's final viewpoint letter
  

What happens when you receive my Complaints Form?

 

We send a copy (and any attachments) to the letting agent and ask for his file and his version of events. Only in a few instances will it be necessary for someone from this office to speak to you directly. A case officer will then undertake a formal review of your complaint, largely based on the documents from both sides, but he may also make other enquiries. The case officer will then present his recommendations in a written case review to the Ombudsman for his proposed decision. That proposed decision may be:

• to support your complaint
  
• not to support your complaint
  
• to propose a settlement
  

What if the Agent has made an offer?

 

If the agent has already made you any form of financial offer to settle your dispute, that offer lapses on referral of your complaint to this office. The Ombudsman will come to his own conclusion as to whether or not that offer represents appropriate compensation for the complaint. If the Ombudsman does not support your complaint, the agent is not required to reinstate the offer previously made.

What level of proof do I need to provide?

 

Please note that, even though we have accepted your complaint, this does not mean that the Ombudsman will necessarily support you. That depends on the strength of your side of the case and what evidence there is to support it.

The Ombudsman needs to be convinced that any fault, in whole or in part, is caused by the letting agent's actions or inactions. It may be that the fault lies elsewhere, eg with solicitors, with the other party (landlord or tenant), or even with you. That will be established in the case review.

It will not be sufficient for you to merely make an unsupported allegation against an agent. The Ombudsman will need to be convinced that there is some reasonable substance behind any allegation. Any proof that you can provide will substantially help your case.

If the evidence provided by the agent disproves your allegation, the Ombudsman is unlikely to support your version of events. However, if the agent is unable to provide documentary evidence and the Ombudsman believes that he should be able to, he is likely to support your version of events.

How will the Ombudsman judge my complaints?

 

In carrying out his review the Ombudsman is guided specifically by the Lettings Code of Practice in judging the complaint.

At the same time, the Ombudsman will be influenced by the information that he sees and will be guided by best practice. He will always try to use common sense and arrive at a decision based on what seems to him to be fair and reasonable in all the circumstances.

However, unlike a court, the Ombudsman has no power to cross-examine witnesses under oath. If one party says 'white' and the other says 'black' and there are no other reasonable grounds upon which the Ombudsman can safely come to a decision on the matter, he may conclude that he is unable to come to a formal decision.

What happens if the Ombudsman supports my complaint?

 

If the proposed decision supports all or part of your complaint and an award of compensation is made in your favour, the case review with that proposed decision is first sent to the agent. The agent has 14 days to accept the decision or make a representation. If the agent submits a representation, this is considered and the case review may be amended as necessary.

The case review is then sent to you with the Ombudsman's proposed decision, together with a copy of the agent's submission and any relevant documents which you may not have previously seen. You will have 28 days in which to accept the decision, or make your own representation.

What if the Ombudsman does NOT support my complaint?

 

The case review containing the proposed decision and a copy of the agent's submission and any relevant documents you may not have previously seen will be sent to you first.

What if I do NOT agree with the Ombudsman's decision?

 

You can submit a representation within 28 days. However, the Ombudsman will only re-consider his proposed decision if:

• You can show that there was a significant error in fact that would have had a material effect on the decision
  
• Or where you can produce significant new evidence that will have a material effect on the decision
  

If you are unable to produce either of these, we will not be able to help you further.

Having considered any representations, the Ombudsman will make a Final Decision.

Please note that the TPO Scheme complaints process is designed so that complaints received about an agent start and finish with the Ombudsman. Having made a Final Decision, there is no avenue for appeal or further review of your complaint for either party within the Scheme.

Any request for an oral hearing will be considered by the Ombudsman (or his deputy), by reference to the nature of the issues to be determined and in particular to the extent to which the complaint raises issues of credibility or contested facts that cannot be fairly determined by reference to documentary evidence and written submissions. In deciding whether there should be a hearing and, if so, whether it should be in public or private, the Ombudsman will have regard to the provisions of the European Convention on Human Rights. The Ombudsman will give reasons in writing, if he declines to grant a hearing.

If the Ombudsman supports me, what can he do?

 

First, he can criticise the agent for any failings or breaches of the Lettings Code of Practice. This is normally confined to ensuring that he examines his procedures and supervision, so that such failings are reduced or eliminated. More rarely, such criticism can result in the Ombudsman reporting a serious breach of the Code to the TPO Council for consideration of their further action against the agent (which could lead to dismissal from the TPO Scheme).

Secondly, and more importantly from your point of view, he can make you an award under the TPO Scheme. Please note that the purpose of this award is to compensate you. Even though it will be paid by the agent you are complaining about, the award is not made to punish the agent, that is not the Ombudsman's role.

Alternatively, the Ombudsman may ask the agent to apologise to you.

The Ombudsman can make awards up to £25,000. He will do so if he is convinced that you have suffered:

• Actual, proven financial loss as a direct result of actions or inactions by the agent
  
• And/or any avoidable aggravation, distress and inconvenience, over and above what is a stressful and inconvenient process at the best of times
  

What happens if I accept the Ombudsman's award?

 

If you accept the award, you do so in full and final settlement of all the complaints against the agent upon which he has made a formal judgement.

Can I accept the award and still go to court?

 

By acceptance of the award, you agree to the full and final settlement of your dispute with the agent and you will be asked to sign your agreement to that effect. TPO Scheme (recognised by the courts as an Alternative Dispute Resolution mechanism) is designed to settle disputes. That is why (to the best of our knowledge) the courts rarely accept, and have never upheld, the case of a complainant who has previously accepted an award under the TPO Scheme. Therefore, if you wish to pursue your case through the courts, you must reject the Ombudsman's findings in their entirety.

What if I don't accept the Ombudsman's Decision?

 

You are free to pursue your complaint elsewhere, without prejudice from anything decided by the Ombudsman. However, please note that the agent will also be free to pursue any claim he may have against you for any outstanding fees.

So, if you reject the Ombudsman's Decision, you also give up your right to any award that he may have made to you.

Do you publicise case reviews?

 

No. Our case reviews and the Ombudsman's Decisions remain strictly confidential between you, the agent and the TPO office. We will not disclose any of the details to anyone else. Whether you (or the agent) make them public is a matter for you. However, we do publish abridged and anonymised case summaries on our website and in the Ombudsman's quarterly and annual reports.

What about the agent's fee?

 

If you are a landlord, your contract with the letting agent usually requires you to pay commission according to the level of service offered. If you refuse to pay, the letting agent has the legal right to take you to court. Some agents may be prepared to wait until the Ombudsman has reviewed your complaint, but no agent is obliged to do so. If you do not pay the fees and the agent commences legal action, the Ombudsman may not continue with his consideration of your complaint. Accordingly, there is an expectation that you will pay the fee, or any uncontested part of it, on a 'without prejudice' basis if appropriate, to avoid legal action. If a court date has been set and is imminent, the complaint will be suspended until after the court action. At that stage, the Ombudsman will determine whether the complaint falls within his remit. If the court date is set for several months ahead, then the complaint will proceed and the Ombudsman will issue his decision in the usual way.