Shed Conversion - Misleading Omission

Published on Tuesday, 09 July 2013. Posted in Case Studies


The potential tenants, Mr and Mrs B signed the tenancy agreement several weeks in advance of the tenancy starting. However, during their moving preparations, the Agent informed them of the landlord’s intention to develop the shed in the garden into a studio for him to work from. Mr and Mrs B were understandably unhappy about the situation (especially as Mrs B intended to work from home) and considered the property to be no longer suitable. Despite the Agent’s attempts to negotiate a solution, Mr and Mrs B withdrew from the transaction and all monies paid were returned to them. However, they were faced with the inconvenience of finding another property at short notice and asserted that the Agent had known about the landlord’s plans at an early stage but had failed to disclose the same.


The Agent’s file showed that they had been aware of the landlord’s plans for the shed at the point they had been instructed to market the property. I was, therefore, not surprised that the Agent’s attempts to persuade the landlord to accept a lower rent ultimately failed leaving Mr and Mrs B facing the inconvenience of finding an alternative property and commuting to central London in the meantime.


I was critical of the Agent’s failure to clearly and transparently disclose information to Mr and Mrs B which would have impacted directly on their enjoyment of the property and affected their decision whether or not to progress a tenancy application. I observed that Mr and Mrs B were genuinely surprised, understandably aggrieved and seriously inconvenienced by the loss of opportunity to proceed with the tenancy as a result of the Agent’s lack of effective communications throughout their dealings with them. In supporting the complaint, I took into account that the Agent subsequently refunded the administration fee of £384 (including VAT) once the tenancy did not go ahead. I made an award of £500 for aggravation, distress and inconvenience.


Paragraph 4f of the TPO Code of Practice requires agents to ensure that they comply with the CPRs which, in this case, would necessarily mean that they were obliged to divulge the information concerning the landlord’s proposed use of the shed as this was certainly material information that every prospective tenant would require when considering whether to progress their interest in the property or not.