Rental commission dispute for contract renewal

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CPCHONG
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Rental commission dispute for contract renewal

Post by CPCHONG » Thu, 16 Jul 2009 10:39 pm

Hi all,

Need your advice here, as i moved to Singapore about 1 year by now.
Back in 2008 Aug I engaged an agent to find me a house, and i paid her 1 month commission with the contract of 1 year which is going to expire on 01 Sept 2009.

Unfortunately, there was a clause inside that contract where it says, me and my landlord agreed to pay them (the 2 agents - 1 from my side , another 1 from my landlord) if we agreed to continue to extend the terms in future.. it sounded like if i continue for the next 10 years, me and landlord still need to pay then every year, the commission of 0.5 mth based on what the new terms agreed.

I talk to my landlord, he doesn't want to pay and i don't want to pay, after all we don't think the agent has done anything for the past 1 year beside the first time connected us to rent and rented out the house.
We thought after 1 year, everything is going to be between me and my landlord.
Now, I pulled out the existing contract as I received the notification letter from the agent company, i noticed this.

My questions which I really need help on are :-
1) Since there is a termination clause inside this existing contract, either parties either me or my landlord can terminate it as long as we give each other 2 months notice - so I already sent the letter to my owner to terminate the contract which continue to be valid only until 01 Sept 2009.

How is the Singapore rental agreement law works ? If i have ceased the contract with my termination letter to my landlord after the expiration date, can the agent still file a court case on me ?

As there isn't any agreement signed between me, landlord and agent, can they pulled out the agreement between me and my landlord to sue us in the court ?

My understanding is, both parties entered into contract can't hold the 3rd party liable for anything, meaning, the contract is between me and my landlord, so there has nothing to do with the landlord, but then I'm not too sure about the Singapore rental law , how exactly this works.


2) Then I would like to work separetely with my owner, which we renegotiated the next year's new contract, and he also agreed with me, so there will be a new terms and contract in place.

Can the agent came back to us said that they want us to pay them commission with this new contract, which has no such terms where me and my landlord agreed to pay them any commission ?

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jpatokal
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Re: Rental commission dispute for contract renewal

Post by jpatokal » Fri, 17 Jul 2009 11:47 am

CPCHONG wrote:How is the Singapore rental agreement law works ? If i have ceased the contract with my termination letter to my landlord after the expiration date, can the agent still file a court case on me ?
I'm not a lawyer, but -- if the contract involving the agent has been legitimately terminated with notice periods etc, then that's it, the contract is over, and it's none of the agent's business if you and your landlord agree on a new contract that cuts out the middleman.
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Post by ScoobyDoes » Fri, 17 Jul 2009 5:46 pm

I think legally, even when the initial contract expires that's it, it expires and is dead in the water.

You are not even legally making an extension to an existing contract but in actual fact simply agreeing to sign a new contract, with a new date but with the old terms and conditions.

Stamp Duty needs to be paid again so this for me means the contract is brand new.




I just "renewed" the lease on my apartment direct with the landlord and only paid the stamp duty.......albeit my agent never even called back as the original lease expired, not even to ask if i needed to find a new place. As an agent, then, he was pretty useless.

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Post by CPCHONG » Fri, 17 Jul 2009 8:29 pm

Thanks for both of your reply !
I really appreciated and wanted to hear opinions.

jpatokal - that's what i thought, and this is what i proposed to my owner as well. We both agreed to work on this way.

ScoobyDoes - I spoke with my contract manager in the US, she has the same thought as you :). She thinks my proposal sounds logical as well, again still need to be careful on what the Singapore rental agreement law says.

Anyone know if there is any ? Or shall this type of things applied by the Real Estate and property Act ?

One other thing is, mine existing contract has no stamp duty - at least not that i aware.
As I assumed that the stamp duty is going to be 'stamped' on the contract in my copy as well as my owner's copy.
But this document (so called agreement) doesn't has this.
Or may be there is a stamped duty being paid that I'm not aware ?
How I know if the stamp duty is paid for a certain contract ?

In the new contract i prepared, I took out some of the terms, not using exactly the same template as the existing one. In this way, can the old terms still continue in my new contract ?

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Post by ksl » Fri, 17 Jul 2009 9:24 pm


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Post by CPCHONG » Fri, 17 Jul 2009 10:05 pm

Oh great... thanks for the web page !

After read the act, meaning the instrument /written document will need to have a 'stamp' on the face of the document.
So what I have signed earlier with my owner has no such "stamp".

I really appreciated those who chip in your opinions here !
Thanks so much.

I just find this whole thing so ridiculous which I have no problem with my owner and we both happy with the tenant and landlord relationship how it was carried out for the past 1 yr.
To continue to the 2nd year rental I negotiated with him and he agreed to reduce the rental $ for me, and happy to continue to rent it to me.

But now, we have to deal with such a headache just because of those agents who does nothing for the past 1 yr and whom has collected the 1 mth commission in the first place.
:evil: :mad:

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Post by ksl » Fri, 17 Jul 2009 11:25 pm

I personally wouldn't worry about it, you have terminated the contract and it means terminated although to be fully effective, you would have to leave the property furniture and all and move back in, in my opinion. The best way is to hire a removal company to load everything up and drive around the block, while you make a new tenant agreement. They would also be your witness that you had moved out, then changed your mind, and moved in again.

Otherwise you would be telling lies to get out of a contract.

Stamp duty just makes the contract legally binding by the authorities, making it more valid, although you do not need to have a stamp duty paid on any contract, the courts would still consider it binding in terms of agreement, but may hold the agency in contempt, for avoiding stamp duty, the agents would have a very weak case without the stamp duty being paid, and would probably be made an example of.

The landlord can do what he wants, if his contract is also terminated with the agency, if it isn't, the Landlord will be at fault not you, after you move out and move in again.

You have made it clear, that the agents service is not required. Although i am no legal expert, I think a little commonsense is needed, to ensure you are not caught out, by leaving everything in the apartment after your termination date.

You just worry about yourself, the Landlord of course wants to save his fees too, so he should tell the agent he no longer needs their services in writing and have it signed for, keep a copy of the letter for himself. I also hope that your termination letter was also copied and signed for? Otherwise any agent can deny ever receiving a termination letter.

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Post by yoongf » Sat, 18 Jul 2009 10:12 am

CPCHONG wrote:Thanks for both of your reply !
..... She thinks my proposal sounds logical as well, again still need to be careful on what the Singapore rental agreement law says.

Anyone know if there is any ? Or shall this type of things applied by the Real Estate and property Act ?
There is no such thing as a "Singapore rental agreement" law.
There is no such thing as a "Real Estate and Property Act".
The only thing to ponder over is what's written in the tenancy agreement, and a document known as the "Commission Agreement" if that was ever signed.

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Post by jpatokal » Sat, 18 Jul 2009 3:06 pm

ScoobyDoes wrote:Stamp Duty needs to be paid again so this for me means the contract is brand new.
Actually stamp duty (which is priced per month) has to be paid even for an extension of an existing contract -- but other than that, I agree.
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Post by CPCHONG » Sat, 18 Jul 2009 4:19 pm

thankssssssss ya.. everybody !

ksl : hey, quite a good suggestion - getting a Mover to move out everything :) I see what do you mean. To be honest, I would like to save the troublesome to move out those furniture by engaging a mover - i think it will cost me around $500-$600 for the whole house (I owned those furniture).

Here is what i thought abt the termination letter, i sent to my owner (not to the agent) only, as i thought the rental agreement was signed with my owner not the agent, so i'm not obligated to inform them.

May be you see it differently ?

In fact, until today i don't really understand is, the rental agreement is signed between me and my owner, just that in our contract we mentioned we will want to pay the agents the commission if we continue the terms in the same contract for extending the stay with no endorsement from the agents. Meaning, they are not part of the contract signatory parties.

Also, in the existing contract, the termination clause said either me or my owner is alright to terminate the contract as long as there is a 2 mths advance notice without any reasons to the other party.

Therefore, either me and my owner not happy with the current contract, we can terminate it anytime as what the termination clause in the contract said.

When come to think abt it.. why do i need to care how the agents handle this ?


yoongf : Thanks for sharing this. It really helps ! I have been searching around for this on the internet.
I don't sign any commission agreement with the agents they were witnesses in the first contract i signed with my owner.


:???:

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Post by CPCHONG » Sat, 18 Jul 2009 4:29 pm

ScoobyDoes - i think your contract are more 'former' than mine since there is a stamp duty.

Mine is really just a piece of paper, then get me & owner signed, then 3 of us (agents, owner and me) keep that piece of paper.

This is really a bad experience to me and a lesson learned.
But of course we can't denied that there are also really good agents out there, just me not having good luck.

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Post by ScoobyDoes » Sat, 18 Jul 2009 5:20 pm

My contract copy is not in itself stamped, but i have a "Certificate of Stamp Duty" stapled to the front of the signed contract, each page signed by myself and the landlord.



jpatokal: There is some confusion between an extension and a renewal. The option to extend is, in all reality, an option to renew for an additional period of time. The original contract is for a fixed term, say two years, and Stamp Duty is paid on that contract. The clause in the contract about an option to extend is in reality an option to have first right on a new, usually 1-yr, lease that can even be under a revised rent rate. This requires Stamped again so is in actual fact, new.

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Post by jpatokal » Mon, 20 Jul 2009 6:53 pm

ScoobyDoes wrote:jpatokal: There is some confusion between an extension and a renewal. The option to extend is, in all reality, an option to renew for an additional period of time. The original contract is for a fixed term, say two years, and Stamp Duty is paid on that contract. The clause in the contract about an option to extend is in reality an option to have first right on a new, usually 1-yr, lease that can even be under a revised rent rate. This requires Stamped again so is in actual fact, new.
Exactly -- my point was that, in the eyes of the law, it's still a "new" contract with duty payable, even though it's still the same old piece of paper.
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Post by ScoobyDoes » Tue, 21 Jul 2009 11:45 am

It would be a new piece of paper as well, with a new date and any new terms such as revised rental to be paid based on current market rate, either up or down but based on agreement between tenant and landlord.

You might find that the new agreement, for example is different in its terms and conditions in some way, like removing or restating the diplomatic clause, or removing the right to first shout on a further extension since in both cases you now enter into a new, 1-yr, contract.

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