A London council has won its appeal against Foxtons using the term “administration fees” in its lettings charges.
Back in 2015 Camden council’s trading standards team undertook enforcement action after establishing that Foxtons was charging an administration fee of £420 for tenants and landlords in its lettings agency work.
The council advised Foxtons about new legal requirements under the Consumer Rights Act 2015, to provide a breakdown of any fees, enabling customers to clearly see the services provided. The company however continued to use the term without undertaking this clarification.
Early last year the council issued four ‘Notices of Intent’, each for the maximum penalty of £5,000, to each branch of Foxtons in Camden borough for using the term without the required clarification.
The company responded that it had subsequently modified their literature to explain that it “can cover” certain services – however it did not explicitly state the breakdown of the fee.
The council considered that this did not provide sufficient clarity and issued four Final Penalty Charge notices in April 2016.
Foxtons appealed those notices in October 2016. It is this appeal which has now been lost by Foxtons and won by Camden council.
“We are delighted with this judgment as it has clarified what letting agents must do when publicising their fees. Because of our successful appeal, customers can now fully understand what they are liable for and make informed choices and proper comparisons with other letting agents about the fees charged” says a council spokesman.
“This judgment also gives clarity to trading standards officers nationally when enforcing fees and by assisting to ensure the market place is consistent for all letting agents and their prospective clients” she continues.
The council says it challenged earlier decisions because Foxtons “administration fees” still did not give an adequate description for the services provided, with it considering that by stating the “administration fee can cover…” did not go far enough.
The penalty charge has been upheld in principle and increased to £4,500 for each breach, totalling £18,000.