Jane’s Story

My very good friend was persuaded to sign up with RTA, having had several telephone calls asking to speak to the company owner and offering to sell his company. Because he wanted to sell, he arranged an appointment for RTA’s representative to come to see him.

RTA’s man arrived, asked lots of questions, looked at the company’s accounts and quoted a value which was higher than a previous value which a potential buyer of my friend’s company had offered some months previously, though that buyer had pulled out.

The rep said that the company would be advertised in trade journals and that my friend was free to advertise his company elsewhere. The rep talked a lot and then presented the contract for signing. He asked for proof of accounts and asked loads of questions during the signing process and did not go though any of the terms of the contract. My friend normally wears glasses for reading but not to look around for paperwork so left his glasses off, so the contract was a blur with such small print. Unfortunately my friend is very trusting and believed everything the rep said.

When my friend told me that he had paid RTA a registration fee up-front, I immediately became suspicious. My friend could not remember any more than the fact that the company was R something and 3 letters, so I searched the Internet. Imagine my horror when I found all the complaints about RTA! I spent quite some time on line and eventually found a load of papers by a past customer of RTA, including the contract. I read the contract (such small print I needed glasses where I don’t normally) and started reading parts of it to my friend. It said that it was a sole selling rights agreement and even if my friend found a buyer for his company elsewhere he would still have to pay RTA a huge commission. He was horrified that he could have signed such a thing but remembered the way the rep kept interrupting when he was reading the contract. He then said how the rep must have been trained to do that, given that the contracts are so limiting. We decided to seek help from a legal advice helpline that he had access to, but they said he was silly for signing the contract as it was a business contract – not helpful! I just had a gut feeling that this couldn’t be right and read all the way through the Daily Mirror articles about RTA being rogues until I found Gill’s story and her e-mail address. I contacted Gill and even managed to get an e-mail from her Barrister.

By then I had found lots more contract law t that confirmed that it was not necessarily a business contract – instead the courts had ruled that it is a consumer contract when the business owner does not normally deal with marketing, or arranging the buying and selling of businesses. The person who signed relies on RTA (or any other Business Transfer/Business Sales Agent )  to advertise and market. RTA and the other Business/Commercial Agents cannot actually sell your business as they are not the vendor, so the contract is NOT exempt from Consumer laws.  The ‘consumer’ ruling isn’t the only way RTA have lost cases – many have been lost on the lack of Due Diligence as per The Money Laundering Regulations, some on the fact that the contracts defy The Estate Agents (Provision of Information) Regulations 1991. Some  contracts have had no ‘consideration’ and many contracts have ‘exclusion’ clauses that don’t pass the test of ‘reasonableness’ – or are unbalanced in favour of the Agent – in the Judges’ eyes anyway.

RTA did not respond to the telephone call or the e-mail that my friend sent to query the contract details. So based on the poor service he cancelled. Immediately he got the nasty letters from RTA but because of this sought more legal advice and  did more research. By then I was heavily involved with CEBTA group who are trying to fight the extremely limiting contracts that RTA and some other Agents produce.

Jane Jones October 2011

Update March 2012 – RTA did not give up, they served a Court Summons in late November and my friend was due in court at the end of that month. However, he managed to secure a low monetary settlement figure agreeable to RTA. The hope is always that the Judge sees these and other similar Agents for what they are (this has happened in some court cases) as theyoften do not adhere to the Civil Procedure Rules. RTA say they don’t want to keep taking customers to court – after all, that seems to be giving them a very bad name – but they could avoid it by making even fairer contracts and giving a genuinely helpful customer service rather than their chief executive writing letters that say “you have only yourself to blame” – as has happened to so many of their customers.

I urge everyone who has a problem with customer service from Business Sales Agents to contact their local Member of Parliament to campaign for greater regulation, as well as their local Trading Standards Office and other regulatory bodies.