Agent ordered to return overcharged fees to tenant by Tribunal

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A letting agent has been ordered to repay £343 to a tenant after levying charges greater than the £50 limit for administration costs. The First Tier Property Tribunal handed down the ruling after it heard Ludlow Thompson had charged the tenant, Mr M. C. Brennan, £393 to provide a new tenancy agreement. The change was significantly more than the limit set out in the Tenant Fees Act 2019.

Mr Brennan was charged the fee after he moved out of a shared property in Hackney, London. The agent argued the fees were reasonable and had been set out in the tenancy agreement. They included referencing the new tenant, inspection, creating a new tenancy agreement and re-registration of deposits.

Mr Brennan argued the fee exceeded the limit set out in the Tenant Fees Act and the Tribunal agreed. The Tribunal said that the transaction was “an ordinary, run of the mill example of tenant churn in shared rented housing.” It added that to charge more than the £50 limit an agent must be able “to point to something that makes the charge at least somewhat out of the ordinary run of similar transactions.”

James Burgoyne of Brunel says: “The Tenant Fees Act allows agents to charge tenants more than the £50 fee limit only in exceptional circumstances; the Tribunal stated clearly that the purpose of the Act was to prohibit and closely control the fees to which it applies. Agents should be very careful to provide clear reasons for charging more than the fee cap and should only do so if they are expected to do work above and beyond normal day-to-day tenant work.”

“Arguments that the £50 charge is not adequate to cover the work actually performed will not be accepted by the Tribunal as a justification, in the face of the perceived intent of the Act. This has created concern that cost consequences will introduce more inflexibility into landlord-tenant relations,” he added.

The First Tier Tribunal has published its Decision and Order online. Reports about the case have been published by The Negotiator, Letting Agent Today and Landlord Zone.

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