The Property Redress Scheme has published its latest list of agents recently expelled from the scheme.

The quarterly expulsions update offers some insight into what leads up to the PRS decision to expel a member, following a lengthy disciplinary process.

This list of agents recently expelled by the PRS includes an explanation of the facts that the PRS considered when assessing each case, and the outcome, including details of any award made.

Sourced Properties Group Ltd – £8,000 return sourcing fee for rent to rent serviced accommodation

The complainant paid an £8000 sourcing fee and signed a three-year lease to use an apartment as serviced accommodation. The fee was then transferred to a managing agent who, it transpired, had no permission from the property owner to use the apartments as serviced accommodation. The agent claimed that this responsibility was the managing agent’s and not theirs. The PRS found that there was a misleading omission by the agent, who had not acted with professional care and diligence. The decision awarded the sourcing fee in full.

NALC Auctions Limited – decision £1,000 + full deposit refund

An auction buyer queried the parcels of land included in an auction lot and was assured that the details provided were correct and complete. After the buyer paid their deposit, it became apparent that some of the parcels included in the lot were not available for sale. The transaction was declared void, but the agent declined the request to refund the deposit. Due to the agent’s lack of care and skill in making sure the parcels were all still available and their false assurances, which caused the buyer to act to her detriment, the PRS decision awarded the full deposit as well as compensation for distress and inconvenience.

Procured Property Ltd – decision £4,700

The agent gave the buyer several assurances about property surveys, existing tenants and prospective buyers. After paying the sourcing fee and conveyancing fees, these promises were not upheld, as there were no existing tenants, no survey reports and undisclosed repair costs became apparent. Despite assurances that these costs would be reflected in the price, no reduction was offered.

The PRS’s decision also considered the agent’s pressure on the buyer to make a quick decision and pay the fee, saying there was a lot of interest in the property. Due to the lack of due diligence and honesty the agent was instructed to refund the full sourcing fee.

Rent Room LTD 

The tenant rented a room from the agent and, when the tenancy ended and the keys had been returned, the agent asked for the complainant’s bank details so the deposit could be refunded. The tenant subsequently chased the payment on several occasions and was assured each time that the deposit would be repaid but it was still outstanding when the complaint was raised with the PRS.

The tenancy agreement was not provided by the tenant, who said it was lost and the agent did not engage with the PRS. With no agreement, the contract terms were unclear. On this point, the tenant was advised to take legal advice on the deposit refund and the potential consequences of non-protection. The PRS’s decision went on to assess the poor service offered by the agent and for this, £150 was awarded for both stress and inconvenience.

Fountayne Managing Ltd

The leaseholder terminated his agreement with the agent, who was required to pass on all relevant documents to make the handover run smoothly. The agent provided no audit trail of any documents being sent and frustrated the process by indicating that the freeholder was responsible for collecting the information, which would only be available for sixty days, before being destroyed.

Because the leaseholder received no formal set of accounts or other information requested, the PRS awarded a refund of eight months’ management fees for the period of poor service. The agent was also instructed to provide service charge statements that need to be verified by an accountant and to send the leaseholder a meaningful apology. The leaseholder was signposted to the Property Tribunal for legal issues raised that were outside the PRS’s authority.

Due to non-compliance with this decision and the link between the two businesses and their directors, both this agent and Fountayne Residential Ltd were expelled.

These agents must now face the consequences of being expelled from the Property Redress Scheme. With the memorandum of understanding in place between the two redress schemes, no expelled member can join any scheme until the terms of the head of Redress’s decision have been settled. This means that property agents who continue to trade, without redress, are doing so illegally and considerable fines can apply.

Sean Hooker, head of redress at the Property Redress Scheme, said: “It is interesting that the rate of complaints increased so significantly as the year went on. In my view this reflects the changing economic situation and growing uncertainty in the minds of consumers.”