UK Landlord Forum / Life

Hi
If solicitors liquidated post property sale exchange / completion then if Estate agent fee deducted from completion statement but solicitor did not pay estate agent, is landlord still liable for the fee as the sales contract was with Landlord / Estate agent but they agreed with solicitor to have fees collected via completion funds.

It'd depend on the exact wording of both of those agreements. Looking at my last set, I (the seller) agreed to pay the agent £x. Their agreement to the conventional route to being paid wouldn't change the first liability.

If the agreement with the agent also said that they'd collect their fee from the solicitor on completion, it might be more complicated.

You'd hope there was some kind of insurance to cover this.

As @jpkeates says, you remain liable for the estate agent's fee. Because their contract is with you, it would be very unusual for the agent to have a clause in their agreement saying they will collect their fee from the solicitor.

You should submit a claim to the liquidator for the amount the solicitor failed to pass on. Provide the completion statement showing the deduction.

You are an unsecured creditor, so you may recover little or nothing but you should still file the claim.

Following up on my comment above...

Solicitors must keep client money in a separate client account that is distinct from the firm's own business account. This is a regulatory requirement under the Solicitors Regulation Authority (SRA) Accounts Rules.

Even though the solicitor has gone into liquidation, the client account should be untouched. That money is not part of the firm's assets.

If they used client money for another purpose, then that is fraud (or perhaps theft).

If there is dishonesty involved, or if the SRA shut down the firm, then you should be able to claim the money from the SRA Compensation Fund.

See https://www.sra.org.uk/consumers/compensation-fund/