This week the YourProperty experts consider an interesting situation that arose when a letting agent rented out a property on a short-term holiday rental basis, without getting authorisation from the property owner.
Although the details of the situation are sketchy, it would appear that the reader has a pre-existing relationship with the agent concerned, as the latter appears to have keys to the property and has let it previously.
It is also not clear whether the agent is required to obtain specific permission from the reader when placing a tenant but, based on his reaction, this seems to be the case.
According to Sean Radue of Radue Attorneys, an agent typically acts on a mandate from a client, which permits the agent to act on his or her behalf.
“In this instance, it seems that the reader has a property available for holiday rentals and the agent acts as the point of contact in negotiating rental and other fees for its use.”
Radaue says such a mandate need not extend as far as confirming the booking and proceeding with the occupation by the tenant.
“These steps could be reserved for the owner and he would retain the final say over who may rent his property and on what terms.”
This is not necessarily a typical example of the manner in which such an arrangement would operate, says Radue.
“Many owners of rental properties trust their agent to take care of all such arrangements, possibly within agreed parameters.”
Thus, as long as the agent ensures that the tenant is suitable, provides a deposit and is able to pay the balance, the agent is permitted to make all the arrangements, says Radue.
“The agent will merely report to the owner on a regular basis and pay over any monies less his commission or fees.”
If the agent did not have the required consent to proceed in this instance, he or she then acted outside of the terms of the given mandate, says Grant Hill of Miller Bosman Le Roux Attorneys in Somerset West.
“Presumably the owner was paid his portion of the rental monies for the use of the property, so the damages he suffered may be complicated to calculate but this may be something for him to explore with his attorney.”
Hill says another aspect to consider may be that of criminal charges if the agent did not have keys to the property and gained access illegally.
“The agent may also have fraudulently portrayed that he or she had the necessary authority to rent the property.”
In any event, the reader could consider lodging a complaint with the Estate Agency Affairs Board, says Hill.
“Based on the information we have, it would appear that the agent acted in a manner that breached one or more rules in the board’s Code of Conduct.”
See the reader’s question here.
