End of Initial Term

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H
Hanfield
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Having previously self-managed our previous let property, we employed professional letting agents on a fully managed basis because we currently spend a lot of time abroad. The agents found our tenants and drew up an Assured Shorthold Tenancy Agreement for the period of 6 months between 22 August 2014 and 21 February 2015. The tenancy has operated very smoothly. However, we did not remember the end of tenancy date (should we have?) and no communication has been received by us from the agents on this point.

However, the tenants received a telephone call from the agents on 21 February (the last day of the agreement). The agents asked them if they wanted to renew the contract to a fixed term (at a cost to them of £50) or go on to a rolling month to month at no cost. The agent wanted a decision by 'tomorrow' (Sunday 22 February!) as detailed in the correspondence 'sent to them last month'. That correspondence was never received by them and no correspondence or other communication has been received by us on the subject.

We feel aggrieved that we were not kept notified of this action by the agent. Nor have they sought our instructions. They have our contact numbers and have been in regular email contact with regard to rent payment and commission deductions but have not notified us at all over this action. We now wish to terminate our agreement with the agent and self-manage the property again. Our tenants wish to remain in the property for the foreseeable future.

Our agreement with the agents states that we may withdraw our instruction so them ‘… upon giving..at least three months’ written notice’ . It goes on to state that they will be entitled to a fee based on 5% plus VAT of the rent payable for the remainder of the term of any fixed term Tenancy Agreement existing at the property at the date of termination.

Our questions are:

1. Do the agent’s actions (which we believe are negligent) in not notifying us of the end of term or seeking our instructions, allow us to end the agreement with them earlier than the 3 months? (The tenant is now able to give one month's notice rather than the fixed term notice that a new agreement would achieve.)

2. At what stage should we draft a new Assured Shorthold Tenancy Agreement?

3. The agents have placed the tenants’ deposit with the Tenancy Deposit Scheme. Can we ask that the deposit be forwarded to our own scheme (Deposit Guard or DPS) rather than returned to the tenant?

4. What will the 5% plus VAT termination fee be based on (if anything)?

22/02/2015 11:33

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