Property management changeover

Our Experts Answer:

It depends on the agreement that you signed with Company A whether it would be honoured and enforced by Company B in the event of a sale. If the agreement bound you to Company A and its successor and assigns (or something similar), then the original contract would have envisaged that you could be bound to Company B in the event that the rent roll is sold. In turn, Company B would be bound by the terms of that agreement.

However, you have stated that Company B refuses to honour the agreement. This indicates that they don’t expect you to be bound by it either. You mention that Company B has been managing your property since the hand-over of the rent roll. You don’t mention how long that has been going on. If only a short while, perhaps the company has been in “catch-up”, replacing a number of other contracts. That is understandable if the other contracts also contained a rent guarantee clause.

You have a couple of options for the ongoing management. You could sign a new agreement with Company B if you are happy to accept their new terms. Alternatively, if Company B doesn’t consider you bound to the earlier agreement, you can take your business elsewhere to a different property manager. Regardless of the ongoing management, if Company A still owes you money under your original management agreement, then you should claim it from Company A.