Tenancy Renewal Avoiding Agent's Fee

[monalisaisme]

Hi All,

I would like to renew my contract, however in the contract was stated that I need to pay renewal fee to my agent. I felt that the agent did not deserve it, since her service to me was only to draw the initial agreement and failed to bridge communication with the owner regarding the house (ceiling leak, broken AC etc) throughout the year. I dealt everything directly to the owner.

The owner and I were in contact regarding the renewal two months before the end of term, and we are in agreement that it'd be easier if we would continue without middle man.

However, there is a clause in the contract that binds me to the agent should I want to renew.


Is it possible to avoid the fee, if:
1. I follow the contract and end the contract as stated (31 Jan). However I deal directly to the owner under different name (using my fiance's name) for next year contract.
What I understand is, the current contract under my name will be ending with the agent. But the owner and I will draw new agreement, thus not needing the agent anymore.
Is this legal and possible?

2. If it is, is it legal and possible if the place is still occupied by me (the previous main tenant, and under new contract will be a registered tenant) but the contract is under my fiance's name (will be the main tenant).

I really love this place and do not want to move out since it'd be more troublesome. The owner also loves having me in the house but we're afraid if the above proposal is illegal and the agent is going to lodge a complaint or else.

Please help. I need to give answer in two days or the latest this weekend

[offshoreoildude]

I think using a straw man would do the trick provided the agent was not aware of the ploy.

[JR8]

Short-changing reneging, double-dealing a-hole who has signed one contract then tries to avoid its' requirements.

Be a man. Live up to what you signed up to. Grade A - 'xxxx'


But hey, even if you are not man enough, the court will judge on your behalf (and such is the beauty's of court to find the right decision), you might be banned. 'Hmmm.... now how i'll you explain your future wife that er, er you can't go via SG on your honeymoon because you'll be arrested.



p.s. Sorry but as a landlord, I really do take it personally when tenants go out of their way to try and completely F over the landlords! But it's business, and one I know it far better than my tenants do as I do it for a living. So... 'You've been warned'.

[teck21]

Sure you can use a different name, but anyone can see how it is still an attempt at a deliberate breach of contract.

If the agent finds out, he/she will lodge a complaint somewhere and claim the money from you.

Then again, how could it possibly be reasonable that an agent expects to be paid for doing nothing? This kind of shit only happens in undeveloped countries, or countries in a highly developed state of pretence.

No reason to pay it, at all.

[nakatago]

The only way I see to pull this off is to let the contract expire but you and your landlord have an arrangement that you'll stay on.

So, you don't leave. But you and the landlord would have to draw up a new lease. Also, you'll take care of the paperwork (stamp duty, HDB submission/approval, etc).

Technically, it's not a renewal--it's a new lease.


@JR8: OP does not wish to screw the owner. OP (and the landlord) wants to screw the agent who was damn worthless anyway.

[Cath C]

I think you're on shaky ground letting the lease expire and then starting the lease again a short time later. This would likely be seen by a court as a deliberate attempt to avoid the agent's fee, and would most likely be viewed as a deliberate breach of the contract between you and your agent.

Has the agent been so bad that you could reasonably argue that they are already in breach of the contract, making it void? Or have they just not returned a few phone calls? If it's the latter, you might not want to have the stress of them bringing a claim against you for the sake of saving the fee.

Have you considered complaining to the agent and negotiating the fee down in light of them not providing the service they were meant to?

Hope you can get a fair outcome.

[nakatago]

I think you're on shaky ground letting the lease expire and then starting the lease again a short time later. This would likely be seen by a court as a deliberate attempt to avoid the agent's fee, and would most likely be viewed as a deliberate breach of the contract between you and your agent.

It won't be on a technicality since the lease expires and the new lease will be different. The exact details of execution it though would be very tricky especially as to avoid any law being broken.

The agent sure as hell won't like it and will surely say all kinds of things (most of which would be bluff) to scare OP. What the OP can do is read up on the law and CEA regulations.

OP can try negotiating with the agent but from my experience, I wouldn't count on a favorable outcome. It's like what I just saw earlier: it's between "damn near useless and inciting murder."

[beppi]

I read the OP's posting as follows:
"I signed a contract that says I need to pay S$XXX to YYY if ZZZ happens. I still want ZZZ to happen, but I don't think YYY deserves the money then. How do I get out of the contract."
You were silly for signing it, but now you will have to live with it and accept your responsibility.
You have exactly two legal ways out:
- Do not renew, but move to another place.
- Show that the agent was engaged (when you first rented the place) by your landlord and not you. Then, following the Estate Agent Act (which is law and thus overwrites private rental contracts) the agent can only charge the landlord a fee, not you (and in that case, if you paid a fee before you can also claim that one back!).
In all other cases, you have to pay.

[x9200]

- Show that the agent was engaged (when you first rented the place) by your landlord and not you. Then, following the Estate Agent Act (which is law and thus overwrites private rental contracts) the agent can only charge the landlord a fee, not you (and in that case, if you paid a fee before you can also claim that one back!).

This is a very good point.
If what beppi said is not applicable I would probably take the risk and follow nakatago's suggestion but only if the agent remains completely passive at the time due to execute the renewal clause (if you have one, have you?).

Edited to add:
All the TAs I have seen that had an option to renew got it in a separate clause. This option gave the tenant the right to conditionally extend the lease (typically by 1 year). There was always defined time to execute this option (typically latest 3 months before the lease expires). This in my opinion defines what should be understood in the TA by renewal and it is also applicable to the clause covering the extra fee to the agent. If this clause is not executed the fee is not to be paid. IMHO of course.

[ScoobyDoes]

Edited to add:
All the TAs I have seen that had an option to renew got it in a separate clause. This option gave the tenant the right to conditionally extend the lease (typically by 1 year). There was always defined time to execute this option (typically latest 3 months before the lease expires). This in my opinion defines what should be understood in the TA by renewal and it is also applicable to the clause covering the extra fee to the agent. If this clause is not executed the fee is not to be paid. IMHO of course.

There is a fine line between renewal and extension.

It could be argued the extension for a year would be chargeable under the terms of the current contract but if the OP and LL agree a brand new TA for, let's say, two years and an option for one year then technically it is a renewal so it has to be clear whether the current TA states renewal or extension.

[monalisaisme]

Thanks for all the input guys.

JR8 - wow, FYI this 'proposal' actually came up together with my landlord. Nakatago explanation was spot on. It was not about the landlords, it was about the agent I deemed useless.

We both wish to not include the agent (and yes, Nakatago, Beppi and x9200 the agent was passive - she only comes in the picture in the first drawing of the contract and even for renewal it was me and the landlord who initiated the conversation first).

I understand that I am on shaky ground. And reading all of your inputs just confirm the risks.

Yes, Cath C - I finally talked to the agent and explain all my dissatisfaction and unfairness I felt. Finally the agent wants to slash her commission down to 50%. At least, it can ease everything out a bit. But hey, it's still up in the air - because that means we still need the agent to come into the picture.

I'll just gonna talk to the landlord about this update. Thanks guys!

[JR8]

Teck21
Sure you can use a different name, but anyone can see how it is still an attempt at a deliberate breach of contract.

[Head in hands]. No, you can’t. Because, for starters:-
a) that would be really stupid
b) the agent will ask for your id
c) you cannot resort to legal action if you signed your lease in the name of ‘Mickey Mouse’.

Then again, how could it possibly be reasonable that an agent expects to be paid for doing nothing?

Because the flat-hunter signed a contract agreeing to those terms.

Nak
Ok thanks noted... I’m like a rudderless ship in the fog. Totally at sea apart from the occasional glimpses of the lighthouse’s beam[wink]

CathC
I think you're on shaky ground letting the lease expire and then starting the lease again a short time later.

Quite because the law will not always follow the precise action, but the spirit in which it was done. If you enter into a sham arrangement then expect it to be judged thus.

Has the agent been so bad that you could reasonably argue that they are already in breach of the contract, making it void?

‘Just and reasonable’, that is what it always comes down to. The presumption of innocence. To argue ‘breach of contract’ you really have to have a compelling paper trail. Realistically it needs months of correspondence, and demonstrable 'last chances, and final last chances'.
a) I have problem A can you fix it please?
b) I didn’t receive a reply to a), I still have the problem can you fix it please?
c) I still haven’t heard from you, please tell me when you will fix this problem by return.
d) Ok. Unfortunately you appear to have no intention of fixing this problem. Unless I hear from you within 28 days... etc
e) Still no reply. If no reply within a further 14 days then I will be forced to enter into legal action against you.

Monalisaisme
JR8 - wow, FYI this 'proposal' actually came up together with my landlord. Nakatago explanation was spot on. It was not about the landlords, it was about the agent I deemed useless.

Ah so conspiring with others to defraud eh? I jest (somewhat), but you better be very careful what typhoon you wish upon your front-lawn. If you deemed the agent ‘useless’ what have you done about that before the issue of renewal came up? I mean can you compile a compelling fat evidence bundle to present at court that they were ‘useless’. That is the test and hurdle of course.

[x9200]

CathC
I think you're on shaky ground letting the lease expire and then starting the lease again a short time later.

Quite because the law will not always follow the precise action, but the spirit in which it was done. If you enter into a sham arrangement then expect it to be judged thus.

If you handle it using the option to renew clause (if there is one) as I described above it is actually in the spirit of the contract as it is valid to assume that not any extension should be considered as "renewal" but only what is defined in the contract. Also, IMO it is the agent's duty to take care of this renewal. As a matter of fact I suggested this course of action for one case of my friend's lease and all end up with a happy end. The agent was not active and only contacted my fried when it was too late already to execute the clause. We sent him a short response that he did not contact the tenant in the due time so his services are not longer required. And this was the end of the story. No further exchange of emails, no repercussions of any sort.
It is afterall about the interpretation of the contract and on top of it this is not in the jurisdiction of the SCT what makes any legal action much more difficult.

[Cath C]

Glad to hear that the agent has agreed to reduce their fee by 50%. You might still have to pay something, but at least it will be legal and everyone knows where they stand.

Make sure you get the 50% reduction in writing.

[x9200]

Glad to hear that the agent has agreed to reduce their fee by 50%. You might still have to pay something, but at least it will be legal and everyone knows where they stand.

Are you suggesting all the other proposed solutions were illegal?