foxton office fair trading
The Office of Fair Trading (OFT) today launched high court proceedings against estate agency firm Foxtons over 'unfair terms' in the company's lettings agreements with landlords.
The watchdog said it was taking action against the London-based firm after receiving complaints from consumers.
Terms in the agreements allow the agent to ask landlords to pay substantial commission after the initial fixed period of the tenancy has expired, even if Foxtons has had no part in persuading the tenant to stay and no longer manages the property.
The terms of the contract state that even after a landlord has sold a property they can still be liable to pay Foxtons, and if the landlord decides to sell the property to the tenant the agent demands commission, even if it has not negotiated the sale.
Foxtons, which is known for its trendy, café-style branches and distinctive fleet of Minis, was the subject of a BBC documentary in 2006, which exposed hard-sell techniques.
The OFT is seeking a declaration from the court on whether the terms breach the unfair terms in consumer contract regulations 1999 (UTCCRs), and an injunction against Foxtons to prevent it using the terms in future.
It said it was aware of similar terms being used by other letting agents, and that if the court action was successful it would lead to a crackdown on other contracts.
The action follows complaints from consumers and discussions with the firm.
A spokeswoman for the OFT said: "We have gone through a consultative process in which we have given Foxtons a reasonable opportunity to amend these terms".
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