OFT acts against letting agent’s terms and conditions

The Office of Fair Trading (OFT) has begun proceedings in the High Court to prevent the letting agents Foxtons Limited from using its current terms and conditions.

The OFT says it is taking the action in response to complaints from consumers.

A spokesman said: “The terms to which the OFT objects in Foxtons' letting agreements can potentially require landlords to pay Foxtons substantial sums in commission, where a tenant continues to occupy the landlord's property after the initial fixed period of the tenancy has expired - even if Foxtons plays no part in persuading the tenant to stay, and no longer collects the rent or manages the property.

“Foxtons” terms can also require the landlord to pay these sums after the landlord has sold the property. The terms also demand commission where the landlord sells the property to the tenant, even where Foxtons has played no part in negotiating that sale.

“Foxtons contends that its agreements with landlords are not unfair and continues to use these terms, and accordingly, the OFT has issued proceedings so the courts can decide the matter.”

The OFT is seeking an enforcement order against Foxtons under the Unfair Terms in Consumer Contracts Regulations 1999 which protect consumers against unfair standard terms in contracts with traders.

If the OFT is successful, it plans to prevent similar terms and conditions being used throughout the letting industry.