OFT preliminary success in Foxtons unfair terms case

As many of you may know, the Office of Fair Trading (OFT) is involved in litigation with Foxtons Ltd (the letting agents) regarding Foxtons’ refusal to agree that certain terms in their agency contracts with landlords are unfair under the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCR).

One side issue in the litigation was whether any injunction brought against Foxtons could affect current contracts as well as future ones. The Judge at first instance accepted Foxtons’ argument that any injunction in respect of unfair terms could only apply to future contracts.

However today the Court of Appeal overturned this ruling, confirming the OFT's long-held view that it can take enforcement action under the UTCCRs to protect consumers in relation to both existing and future contracts. The Court of Appeal stated that the UTCCRs aim was to protect consumers, and that they were of the view that traders should not have the freedom to pursue existing customers without restriction, in correspondence or by litigation, in order to enforce contractual terms that have been found to be unfair.

So if you are a landlord with an agency contract with Foxtons, they should not now levy any charges under the disputed clauses on you until after the main action has been heard. This is presumably not going to do Foxtons’ cash flow a lot of good.

The main action, i.e. on whether the terms in question are actually unfair or not under the regs will be dealt with by the High Court in the week commencing 27 April.

To read more, click here.