REsidEnTiallettings
CanCellation rights However, they also took the view that management agreements
I was interested to read the most recent Letting Factsheet No.39 could be included as these are not ‘concerning’ ‘rights’ to
regarding the new Cancellation of Contracts Made in property, but rather the maintenance and repair etc of property.
Consumer’s Home or Place of Work Regulations 2008. A further complication arises, as to whether a landlord is a
Although we agree that the regulations do not apply to tenancy ‘consumer’ for the purposes of the Regulations (as opposed to a
agreements, your Factsheet states that the Regulations may apply trader). The Regulations only protect contracts signed with
to other types of legal agreements such as agency agreements consumers, and not commercial contracts between businesses.
between the agent and landlord, or rent guarantees. It is possible that a landlord who lets his property whilst he is
We have been advised by our head office that agency temporarily abroad could be classed as a consumer whereas the
agreements are not covered by these Regulations, and therefore landlord who owns several investment properties is likely to be
no cancellation notice needs to be given to the customer. acting in the course of business. In this matter, the trading
Why the difference of opinion, and who is right? standards officer was unable to comment on which types of
As with much new legislation, the Regulations are designed to landlords might be considered to be consumers under these
be wide-ranging across many types of consumer contract. They Regulations. As lawyer Stephen Fowler comments in his article
were designed to clamp down on high-pressure sales techniques on page 28, (LUJ, April 2009) the best advice is to err on the safe
from door-to-door and telesales selling, and give consumers the side, and ensure, until the law is clearer, that any terms of
right to a cooling-off period of at least seven calendar days. business are compliant with the legislation. Alternatively, always
Unfortunately, in drafting the Regulations, insufficient thought ensure that such documents are signed in the firm’s offices so
was given to specifying precisely which types of contracts were that it is clear the Regulations do not apply.
caught by the legislation, and which were to be excluded. In the
case of agency agreements, and rent guarantees, these do seem
to represent a true grey area at present. Even between the
lawyers advising The Letting Centre, we cannot reach a
consensus. Clarity will only come when a case is heard in the
courts and reaches the Court of Appeal, where a final decision
can be made. Until this happens, the best that any lawyer can
say is that these Regulations may apply to these types of
agreements. The Regulations make it clear that, where a business
agrees to provide a service to a consumer, and the contract was
made in or around a meeting which took place at the consumer’s
home, place of work, or home of another individual, then the
consumer shall have a number of rights – including most
importantly the right to cancel the contract within seven days.
However, the Regulations allow for certain exclusions (which are
set out in Schedule 3 of the regulations). These excluded
contracts are defined: Contracts for the construction, sale or
rental of immovable property, or a contract concerning other
rights relating to immovable property other than:
•
(a) a contract for the construction of extensions, patios,
conservatories or driveways;
•
(c) a contract for the repair, refurbishment or improvement of
immovable property
So, it seems reasonably clear that the tenancy agreement is
excluded by the Regulations (being a contract for the rental of
immovable property), but it is less clear whether a rent guarantee
or the agency agreement is caught by the Regulations.
We put the question to Dorset Trading Standards
Department. Their view was that ‘letting-only’ agency
agreements would be outside the regulations on the basis of the
‘concerning’ other rights part of the schedule 3 exclusion.
52 JUNE 2009 PROPERTYdrum
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76