The Office of Fair Trading v Foxtons Ltd

The Office of Fair Trading v Foxtons Ltd

The renewal commission, third party renewal commission, and sales commission terms in Foxtons’ standard contracts are unfair under the UTCCR. They are not part of the core bargain as perceived by the typical consumer, are not expressed in plain and intelligible language, are not sufficiently flagged or explained, and create a significant imbalance to the detriment of the consumer landlord. The terms operate as concealed traps or time bombs, are not justified by the services provided, and would surprise the typical consumer. Accordingly, they are subject to and fail the fairness test under the Regulations.

Parties
Claimant: The Office of Fair Trading; Defendant: Foxtons Limited
Jurisdiction
England and Wales
Judgment Date
10 July 2009
Procedural Posture
Civil / Judgment After Trial of Application Under the Unfair Terms in Consumer Contracts Regulations 1999
Outcome
All impugned terms (renewal commission, third party renewal commission, sales commission) found unfair under the UTCCR. Relief to be determined at a further hearing if not agreed.
Legal Topics
Unfair Terms in Consumer Contracts, Standard Form Contracts, Interpretation of Consumer Contracts, Remedies for Unfair Terms
Consumer Protection Contract Law Unfair Terms in Consumer Contracts Standard Form Contracts Interpretation of Consumer Contracts Remedies for Unfair Terms

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Parties

The Office of Fair Trading

Claimant

Foxtons Limited

Defendant

Procedural Posture

Civil / Judgment After Trial of Application Under the Unfair Terms in Consumer Contracts Regulations 1999

Legal Issues

  1. 1 Are the renewal commission provisions in Foxtons’ old and new terms unfair under the UTCCR?
  2. 2 Are the third party renewal commission provisions unfair?
  3. 3 Are the sales commission provisions unfair?

Ratio Decidendi

The renewal commission, third party renewal commission, and sales commission terms in Foxtons’ standard contracts are unfair under the UTCCR. They are not part of the core bargain as perceived by the typical consumer, are not expressed in plain and intelligible language, are not sufficiently flagged or explained, and create a significant imbalance to the detriment of the consumer landlord. The terms operate as concealed traps or time bombs, are not justified by the services provided, and would surprise the typical consumer. Accordingly, they are subject to and fail the fairness test under the Regulations.

Court Disposition

All impugned terms (renewal commission, third party renewal commission, sales commission) found unfair under the UTCCR. Relief to be determined at a further hearing if not agreed.