Property Manager terminating fee

We terminated a property management agreement with our PM because we were not happy with her service.

This was due to different reasons why we no longer wanted to use her and we would manage the property ourselves from now on.

She had a 90 day termination clause in the agreement so she sent us an invoice for 90 days PM fee.

We were very surprised as this had never happened before a PM wanting the full 90 days fee.

She then took the full 90 day fee ( in advance) from rent monies due to us.

Does anyone know if she is entitled to this upfront ?


Can she take the full 90 days from rent paid by a tenant or are we entitled to pay her on a weekly basis?
 
I too signed up with a PM company and signed the 90 day termination clause. I was not aware that it is a standard statement and most just cross the 90 days out and put 30.. You live and learn.

I would say, as we have signed the contract with the 90 day termination fee not altered,we by law would be obliged to paying the fee regardless.

Is she entitle to take her money before you getting the remaining? As that is how they normally work.. their commission, any other bills paid on our behalf etc come out before you get your slide of the pie, I would say it was the norm. If you are leaving not on happy terms, I say she cover her **** and getting her money first.

But this is all from a novice who really knows nothing :)
 
Hi Seabreeze 99

Thanks for your input. Also we have contacted the Office of Fair Trading because the PM is trying to keep a $275 "Re-let fee" from the tenants bond refund when in fact I am now managing and re-letting the property myself.
 
She then took the full 90 day fee ( in advance) from rent monies due to us.
This is most unusual as PM are remunerated as a % of the rent they collect. :confused:

Does anyone know if she is entitled to this upfront ?
Yes, the only one who knows is YOU! Please go back and read the contract you signed with her and especially the clause/s about termination, and see what it says. ;)

She's entitled to do what you signed up for.
 
Yes, the only one who knows is YOU! Please go back and read the contract you signed with her and especially the clause/s about termination, and see what it says. ;)

She's entitled to do what you signed up for.
Section 12.2 of the Essential terms and Conditions state that "The Lessor must pay to the Agent, all commissions and fees to which the Agent is entitled during the notice period.....'
There is no mention of when this payment must be made, at the commencement, during or at the completion of the 90 day period.
Keep in mind that when her invoice for 90 days management fee was mailed to us the property was still empty and I was looking for a new tenant. Also the management fee was notially based on the rent I was previously receiving from the last tenant, but the demand in the area had softened and I am unlikely to achieve the same rental from my next tenant.
 
Section 12.2 of the Essential terms and Conditions state that "The Lessor must pay to the Agent, all commissions and fees to which the Agent is entitled during the notice period.....'
There is no mention of when this payment must be made, at the commencement, during or at the completion of the 90 day period.
our_renos,

If that is what the REI solicitors have written in their draft Contract to fully protect their Agent members against the Landlord customers, then you as a hapless Landlord customer are completely stuffed if you have signed it.

As it doesn't specify when they can be paid, they are quite within their rights that you have grnated them to rip the full 90 day fee out of your rent. Doesn't feel too good does it....

Of course, they thought about this scenario when drafting the wording of the management contract. The only question is, did you think about it before you signed off on it ?? Most people don't. Most people simply initial where the PM tells them to, gives it a quick 1 minute flick and then it's all over. Right there is where you just got shafted. Right there is where the PM formed their opinion of whether or not you are a savvy Landlord. Right there is where they got the better of you...and they have been waiting to use that advantage...and now they are.

They approach the draft Contract with the initial intention of the Contract weighting being 100% the way of the Agent. It is solely up to you as the customer to pare the wording back to some resemblance of being fair. Of course, the principal of the agency will resist you as much as possible from the "standard" form, as that is the one that covers their butt the most. Any changes you make and they accept is detrimental to their position when you come to the back end of the contract, like where you are at now.



Keep in mind that when her invoice for 90 days management fee was mailed to us the property was still empty and I was looking for a new tenant. Also the management fee was notially based on the rent I was previously receiving from the last tenant, but the demand in the area had softened and I am unlikely to achieve the same rental from my next tenant.
None of that needs to be kept in mind. It is strictly as per the contract wording.
 
Question for Empty Pockets...

Can you cross out the 90 days and put 0 even though the contract states that the period must not be less than 30 days???

Thanks.
 
Can you cross out the 90 days and put 0 even though the contract states that the period must not be less than 30 days???
Well just cross out that part of the contract that states "that the period must not be less than 30 days".

That is not contract law. Contracts can exist for whatever period of time that both parties agree to. :cool:
 
The Office of Fair Trading have advised us that they are acting on my complaint and will visit the RE agent tomorrow to find out what has happened to the $275 "Re-let fee". They will also look into the legality of taking the full contract termination fee up front.
 
The Office of Fair Trading have advised us that they are acting on my complaint and will visit the RE agent tomorrow to find out what has happened to the $275 "Re-let fee". They will also look into the legality of taking the full contract termination fee up front.
well done for taking action and hopefully a lesson learned
 
The Office of Fair Trading have advised us that they are acting on my complaint and will visit the RE agent tomorrow to find out what has happened to the $275 "Re-let fee". They will also look into the legality of taking the full contract termination fee up front.
What was the outcome?
 
If the property was vacant and no tenant was found by the agent then most agents will terminate with no fees they are initialed to the management fee depending on what commission you are on can be anywhere from 2% of weekly rent. but cannot get the rent collection fee as no rent is coming in.

you have 3 options you can give the 90days notice and take the property back after the 90days have ended or pay them out.
Or give the property to a different agent and they will normally pay this for you or give you 90days free management.

I am a BDM in Brisbane and I have changed all my PAMD 20a’s to show we only require 7 days notice to terminate contracts as its one of my service guarantee

I hope this helps will be interesting what happens with this
 
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