Letting Agent ordered to return ‘administration fee’

A Belfast Court recently ordered a letting agent to return a £30 ‘administration fee’ charged to a tenant.

The Plaintiff tenant had previously entered into a tenancy agreement on a property marketed by the Defendant on behalf of the landlord. That agreement contained a provision for the payment of  ‘[a] one off Administration fee of £30 per Tenant… within 1 week of signing [the] agreement.’  

This was paid duly by the tenant along with a deposit and the first month’s rent.  On subsequently vacating the premises, the tenant sought the return of that fee under the Commission on Disposals of Land (Northern Ireland) Order 1986.

The case turned on the construction of, what the District Judge described as, (a) the stipulation element and (b) the commission element to be paid to an agent on a disposal of land.

The District Judge concluded that this definition of commission seemed to allow a tenant to recover any monies he had had to pay towards the remuneration of a letting agent for work carried out on behalf of the landlord.

In paying the administration fee, the tenant was contributing in part towards the costs of the services the letting agent had been commissioned by the landlord to do and that such a payment is void under the provisions of the Order. The tenant was therefore entitled to have the monies returned to him.

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