The Office of Fair Trading has stepped in to advise house sellers who could be hit for unexpected double fees when using both conventional estate agencies and ‘no-frills’ firms.

There are currently about 200 Internet property retailers trading in the UK. Some of these claim not to be engaging in estate agency work when in fact many do appear to fall within the legal definition, says the OFT.

Some customers who are already signed up to sole agency agreements with traditional high street agents have found themselves having to pay two sets of fees (one fee to the high street agent and another to the internet property retailer) after selling their property via such a property retailer, even though the property retailer advertised itself as not being an estate agent and assured the client they would not have to pay a fee to their original agent.

The OFT makes it clear that a sole agency is just that and no other agent has the right to sell the property during the period of the agreement. The seller can sell the property himself without paying the agent a fee - provided that the buyer was not introduced to the seller by the agent during the contract period.

The guidance sets out examples of the types of activities carried out by property retailers that are likely to be carried out for the purpose, either of introducing a client to a prospective buyer or seller of property, or bringing such an introduction to a successful conclusion. These are likely to fall within the definition of estate agency work as set out in the Act, and include:

• Providing clients with a 'For Sale' board and/or putting it up outside their property, particularly where the board contains the property retailer's contact details
• Receiving and fielding queries from potential sellers or buyers and passing on details to their clients
• Sending out property particulars and arranging viewings.

Trevor Kent, former president of the National Association of Estate Agents, said, "In a nutshell what this means is that if a seller gives an estate agent a sole agency to sell their home and then calls a '£99 no frills internet firm' in who finds a buyer they still have to pay the agent their fee."

The Estate Agents Act 1979 covers anyone who, in the course of business, is engaged in 'estate agency work'. This means introducing to someone else a person who wishes to buy, sell or lease land or property, and being involved in negotiating the subsequent deal. The work must be in the course of business, whether as employer or employee, and as a result of instructions from a client.