OFT takes Foxtons to court over 'unfair' fees
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One of London's leading estate agencies is being taken to court by the Office of Fair Trading over allegations that it is treating landlords unfairly. Foxtons is said to be requiring landlords - including the former Blue Peter presenter Konnie Huq - to enter into "unfair" contracts. It is claimed the company, one of the biggest managing agents in the capital, is requiring its clients to pay commission after the initial fixed period of a tenancy has expired. The Government body has been prompted to act after receiving a flurry of complaints and after the company was investigated by the BBC Watchdog programme earlier this year. The estate agency contends that its agreements with landlords are not unfair and insists it is doing nothing wrong, but the OFT has issued High Court proceedings under the Unfair Terms in Consumer Contract Regulations in attempt to stop the company continuing to draw up these contracts. Foxtons charges landlords a fee for initially finding tenants, but has it written into a contract that the landlord must pay commission if a tenant stays in a property - even if the company no longer manages it. Foxtons still takes money even if it plays no part in persuading the tenant to stay and no longer collects the rent. Furthermore, if a client sells their property half-way through a contract, Foxtons insists in collecting a commission for the full period of the contract. One of the company's unhappy clients was Miss Huq, the former Blue Peter presenter, who owns two flats in west London. She said on Tuesday that the OFT's decision to take Foxtons to the High Court was "a victory for landlords for everywhere". Foxtons found her a tenant and charged her 11 per cent of her first year's rent as a fee. But when the tenant wanted to renew for another year, the company charged Miss Huq another 11 per cent up front. "I was really angry when I realised Foxtons were demanding money from me for doing no extra work at all," she told the Watchdog programme. The OFT has made it clear that Foxtons is not the only estate agents to use these practices. A spokesman for Foxtons said: "These issues are of great relevance to the estate agency industry as a whole. "As the OFT have pointed out they are treating this as a test case; we welcome the opportunity to have a court clarify the matters raised by the OFT as we are of the opinion that they are fundamentally misconceived." |
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