Ads for properties for rent posted by an estate agent on rightmove.co.uk. The ads provided general information about the properties as well as the cost of rent per calendar month.
The complainant challenged whether the ads were misleading because they did not include a compulsory administration charge.
Your-move.co.uk Ltd (YML) stated that information about the administration charge referred to in the complaint was available on their website and on request from the YML branch. There was also a link to the website on the ads. They said this was in line with market practice and that no agent, listing properties on Rightmove, disclosed admin fees within the listings themselves. This practice was in line with the requirements of the Association of Residential Lettings Agents (ARLA) and The Property Ombudsman (TPO), both of whom issued codes requiring that all relevant fees and charges be detailed in the terms of business, which must be available to tenants prior to commitment.
The fees payable were not a fixed amount: they varied from region to region and also depended on the applicant's individual circumstances, e.g. whether or not a guarantor was required. The information available to the consumer indicated that a fee would be payable and what the fee covered. It did not define exactly how much the fee would be.
YML acknowledged that fees and charges were material information that would be relevant in the consumer's decision to rent. However, YML did not believe that consumers arranging viewings on Rightmove were at the stage of deciding whether to rent. They therefore did not believe that the administration fee was material information that needed to be made known at this point. For this reason, information on the administration fee was only made known to the consumer at a later time, but before they had decided to rent with YML.
The ASA noted that the exact value of the administration fee depended on the location of the property as well as the consumer's individual circumstances. We therefore considered that it was not always calculable in advance. CAP Code rule 3.19 3.19 If a tax, duty, fee or charge cannot be calculated in advance, for example, because it depends on the consumer's circumstances, the marketing communication must make clear that it is excluded from the advertised price and state how it is calculated. stated, "If a tax, duty, fee or charge cannot be calculated in advance, for example, because it depends on the consumer's circumstances, the marketing communication must make clear that it is excluded from the advertised price and state how it is calculated".
We noted YML's argument that the details of the administration fee, whilst material information at the time the consumer was deciding whether to rent, was not material when searching Rightmove and arranging viewings. However, we considered that deciding whether to arrange viewings was itself a transactional decision and likely to be affected by the existence and cost of an administration fee. We therefore considered that this was material information when consumers were searching Rightmove, not just when they were deciding whether to rent. The ads should have indicated clearly that the administration fee was not included in the quoted prices and should have provided enough information to allow the consumer to establish easily how further charges would be calculated. Because the ads did not include this information, we concluded that they had breached the Code.
The ads breached CAP Code (Edition 12) rules
Marketing communications must not materially mislead or be likely to do so.
Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means. (Misleading advertising) and 3.19 3.19 If a tax, duty, fee or charge cannot be calculated in advance, for example, because it depends on the consumer's circumstances, the marketing communication must make clear that it is excluded from the advertised price and state how it is calculated. (Prices).
We told YML to ensure that their ads made clear when non-optional fees and charges, that could not be calculated in advance, were excluded from quoted prices, and to provide enough information to allow the consumer to establish easily how further charges would be calculated.