Home » News » London agency fined £3,000 for breach of Tenant Fees Act over £180 payment
Regulation & Law

London agency fined £3,000 for breach of Tenant Fees Act over £180 payment

After investigating the complicated case, a First Tier Tribunal has rejected the agency's appeal against the 'reasonable' fine.

Nigel Lewis

lettings agency fine london

A lettings agency and property management firm in London has been fined £3,000 after a First Tier Tribunal found that it had breached section 1 of the Tenant Fees Act by requiring a tenant to pay a £180 fee deemed to be a prohibited payment.

The tribunal heard that the London Borough of Hammersmith & Fulham had told Tops Holdings Ltd that it was satisfied that on in March last year the company required tenant Mr Borufka to make a prohibited payment.

This is because when the tenant at the Earls Court house flagged up his intention to vacate the property, £180 of his £540 tenancy deposit was held back as an ‘admin fee’.

In his ‘licence to occupy’ contract this fee was set out as being ‘for general administration charges relating to the application including a check-in and check-out inventory, background checking, marketing of the room, drafting of the contract, rent collection etc after vacating the room’.

The council, in its submission to the court, highlighted how such admin charges in connection with the ‘granting of a continuance assignment termination or renewal of a tenancy, are banned outright’.

Fine appealed

Top Holdings Ltd then appealed the fine which had, during the interim, been reduced from £5,000 to £3,000, explaining that the company had erroneously used an old contract as the Tenant Fees Act had come in just a few weeks before the tenancy started.

It also said a manager at the firm had misunderstood the terms of the act and claimed that the level of the fine was not appropriate.

The agency’s £180 fee was to pay a third party to prepare a Deed of Surrender, the court heard, due to Mr Borufka’s wish to give up possession of the property earlier than the time of the expiry of the notice period and the fixed term.

“It was for that reason that a deed of surrender was prepared to ensure clarity and that despite Mr Borufka not having a strict legal interest in the property it was to ensure that he could not thereafter claim he had been evicted,” the judgement remarks.

The tenant failed to sign this deed and the Tribunal examined the complicated explanations given by both sides as to why this did not happen.

In summing up, the Tribunal said: “The local authority has been able to prove to us that an offence has been committed under the Act and that the council had properly applied their policy in this case.

“We are satisfied that the civil penalty imposed is reasonable and is payable.”

Read the judgement in full. 

November 29, 2021

One comment

  1. And this really does not help tenants going forward. More limited supply. More expensive rents. And only super perfect tenants are getting houses.
    3k fine. What next.

What's your opinion?

Please note: This is a site for professional discussion. Comments will carry your full name and company.

This site uses Akismet to reduce spam. Learn how your comment data is processed.