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RealEstateAnswer, Lawyer
Category: Real Estate Law
Satisfied Customers: 28019
Experience:  10+ years in handling Leases, Landlord-Tenant, Foreclosures,Mortgages, and Eviction cases
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We hired a RE agency in Florida that specializes in leases

Customer Question

We hired a RE agency in Florida that specializes in leases to find us a new tenant. The agency was aware that we had a current tenant (who was a friend of the leasing agent)who wanted to terminate their lease early if they could find a new tenant. We also had a lease termination clause with the exiting tenant they if he wanted to vacate early we would owe us $5,000. The exiting tenant was a FL RE agent employed by a different agency. The leasing agent agree to pay the exiting tenant a commission if he found a new tenant (which he found). Before signing the new lease agreement with the new tenant I asked the leasing agent to make sure that the exiting tenant would be out before the new lease began. She assured me that there was no problem. Two days before the exiting tenant was to vacate and the new tenant move in he stated that he would not leave until we forgave the $5,000 due us under the early termination clause. Given that the leasing agent failed to 1. obtain an early termination letter from the exiting tenant and 2. entered an agreement to pay a RE agent employed by another broker a commission are we legally obligated to pay another commission to this agency if the current tenant renews his lease? I do not want to pay them any more money as they already cost me $5,000 beyond the commission they were paid previously.
Submitted: 2 years ago.
Category: Real Estate Law
Expert:  RealEstateAnswer replied 2 years ago.
Good evening. Did the tenant provide you anything in writing to evidence his desire to vacate? Did he advise you and give written notice that he was exercising the early termination clause and would be vacating? Have you addressed this issue with them, in regard to their assurance the current tenant would be out and how that failed to happen and how the tenant essentially tried strong arming you? Is the current lease still in effect and the tenant is just going to remain?
Customer: replied 2 years ago.
We had received an email from the previous tenant saying he wanted to vacate early. He then put us in contact with a friend of his at the rental agency who would work with him to find a new tenant. The previous tenant (a licensed florida real estate agent) then brought a new tenant to the agency. The agency drew up a lease for the new tenant but failed to get the previous tenant to sign a lease termination agreement. The RE LEasing Agency was well aware of the issus with the prvious tenant refusing to leave. The new lease is expiring on 7/30/15 and they want to renew we do not want to pay the RE leasing agency another commission for this year.
Expert:  RealEstateAnswer replied 2 years ago.
Thank you for the additional information. Based upon what you shared above and the actions of all parties, it would appear you could have had a basis to evict the previous tenant and sued for damages, based upon your reliance on his email and him being aware and putting you in contact with a friend who was finding a new tenant AND knowing that a new tenant was found and a new lease was signed. Moreover, if the new tenant took action against you and sued and you suffered damages, you could possible go after the old tenant. Now, if nothing happened and everyone walked away and the only issue now is paying another commission, you can certainly negotiate and work with the Realtor on this. You can advise them of how they failed to represent you and you relied on them to get this deal done and they failed and you lost a new tenant, exposed you to a potential lawsuit and cost you $5000. As such, you can advise them that you will not be paying them the $5000 and now, since you have the upper hand, can simply not renew the lease and let him find his buddy a new place to live, like he was supposed to be doing before. If you have concern about this rental sitting idle, you can also come back and see if they would accept a lower commission. If you have to find a new tenant, you can try and find a realtor how would charge less, just to cut ties with the tenant and realtor, who seem to be working together.
Customer: replied 2 years ago.
Basically did the leasing agency breach a duty to us when they did get a lease termination agreement from the previous tenant that would allow us to get out of the "exclusive Right to Lease Agreement" that says if my new tenant renews I have to pay another commission to them? They knew the original tenant was leaving early, they knew the date would not be established until a new tenant was found and they drew up a new lease and, when I asked, stated that there would be NO overlap with the old tenants lease and the new tenants lease. If they had gotten a signed lease termination, then I would not have lost $5,000. I am not planning to sue them for that, I just don't want to have to pay them any more money. And I want them to return the new tenants deposit money (which they are refusing to do).
They also entered into an agreement with our former tenants (a licensed FL real estate agent employed by another agency) to pay him a real estate commission/finders fee) if he brought a new tenant to them - which I think is against FREC rules.
Customer: replied 2 years ago.
I want to renew with the existing tenant, but I do not want to pay any more real estate commission to the agency. The tenants that are there are wonderful. We want out of any obligations to the RE agency but they are refusing. Do I have grounds to report them to the Florida Real Estate commission?
Expert:  RealEstateAnswer replied 2 years ago.
You can certainly report this conduct and their agreement to the State of Florida and have it looked into. If there was wrong doing, their licenses can be suspended or even revoked. If the agency was handling the entire transaction, then they should have obtained all the required documents. Since they knew this guy who was the tenant, they may have been laxed in doing so, thinking he was a man of his word, which he clearly was not and took advantage, once he knew that a tenant was found. His thought was likely that since there was no overlap, you would not suffer any damages, so no reason to pay you $5000. Something to also keep in mind, depending on your agreement, if the new tenant did move in, would you have had to pay them a commission? If so, depending on the amount, you may and would have had to pay the commission, so you need to see if it is worth litigating.
Customer: replied 2 years ago.
The new tenant did move in in 7/2014 and we paid the agency a commission last year. We had to give up the $5,000 in order to get the previous tenant to leave so the new tenant could move in. It was the previous tenant and the RE agent who were friends - not the newer tenant. Did the RE agency breach a duty to me when they failed to get a signed lease termination agreement from the previous tenant? And is that grounds for me not to pay them a second commission when my tenant renews?
Expert:  RealEstateAnswer replied 2 years ago.
Yes, if in the proper course of business when dealing with rental properties and early terminations, they should have obtained something in writing, to evidence the intent of the tenant and they failed to do so, they could have breached their duties to you. After all, if this was signed and agreed to, it would have included the 5,000 fee and would have needed to be paid. Even though you shared that you had to give it up, you may have a defense that you were forced to do this and it was not voluntarily done, as a result of the new tenant moving in. However, this is a separate issue and should not effect their ability to get the commission, since they did find a new tenant. At the same time, if they are aware of the potential lawsuit, they may be willing to forgo this, to settle it.
Expert:  RealEstateAnswer replied 2 years ago.
I just wanted to follow up and see if you had any other questions or needed me to clarify something. I am here to help, so please let me know. Thanks!