My Tenant Is Threatening Legal Action Because I Didn’t Secure The Deposit

Tenancy Deposit Legal Action

I could throw a stone in the middle of a landlord conference (who actually goes to those things?) and I’d probably hit a landlord on the head that’s either been through it, going through it, or will eventually go through it: threatened with legal action for failing to comply with the tenancy deposit legislation!

So, what to do if you’re being threatened? Let’s talk about it…

Rightly or wrongly so, landlords are being hunted down like rabid dogs for failing to comply with the tenancy deposit legislation. We’ve become such easy and profitable targets that specialised ‘tenancy deposit claim management’ divisions are popping up all over the place, to assist in the management of dragging and encouraging dormant tenants to claim their unclaimed fortunes. How fucking generous of them.

Business is BOOOOOOOOOOOOOMING!

Every landlord should unequivocally comply with their legal obligations, even the policies that are more ghastly than the boils on your mum’s sloppy face. And while so many try to use ‘ignorance of the law’ as a defence (from my experience, that’s the most common excuse), legitimately or otherwise, it’s still (and always will be) pointless to even mutter the words. Save your warm, unsavoury and moisty breath for your spouse.

But on the other hand, I’m finding it impossible to empathise with those dick-face tenants that are taking advantage of innocent ignorance purely out of greed. Don’t get me wrong, unscrupulous landlords deserve for their profits to be drained like a large infected cyst, and compensation should be allocated fairly to those that suffered as a consequence. But sadly, there are too many cases surfacing whereby good landlords, but foremost genuine people that are only trying to do good, have been threatened and prosecuted by an academy of asshole tenants that are sniffing around a quick paycheck. Spineless leeches!

Celebrating tenancy deposits

Introducing the tenancy deposit legislation was a good move to protect both tenants and landlords, but as it currently stands, as with many legislations that are hashed together by servants whom are completely inexperienced and have no practical knowledge of how the relevant realm works, the finished product seems like it’s lined with clunky congealed skid-marks. Who approved this shit?

It’s clearly ridiculously too damn easy for undeserving prosecution, which has resulted in a long queue of tenants rubbing their grubby little mitts together and practically begging for landlords to fall-short of their deposit obligations, because it’s like a winning scratch card. That can’t be right, not on any level.

So this blog post is aimed at helping those “good” landlords caught up in the struggle. Stay strong, my brothers! Stay strong!

The Tenancy Deposit Legislation

Ok, so let’s go over this really, really, really, really, really, really quickly, because I’ve already covered the what, where and how’s in-depth, over at the Landlord Tenancy Deposit Guide blog post.

Obviously, complying with the tenancy deposit legislation from the offset, which is covered in Section 213 of the Housing Act 2004, should be Plan A:

  • This legislation applies to every landlord in England and Wales that has taken a deposit from a tenant under an Assured Shorthold Tenancy Agreement.
  • Securing the deposit: the deposit must be protected with in 30 days of receiving it.
  • Serving the Prescribed Information: after the deposit is secured, Prescribed Information must be served to the tenant, also within 30 days.
  • Late compliance: unfortunately, you’re still a target if you’ve secured the deposit and/or served the Prescribed Information after the 30 day window!
  • Landlord’s responsibility: it’s ALWAYS the landlord’s responsibility to ensure the deposit legislation has been complied with correctly. Don’t rely on your agent for anything, they won’t be held accountable.

The penalty for failing to complySection 214 of The Housing Act 2004 states that IF a Judge is satisfied there has been a breach they MUST sanction the landlord to cough up between 1 and 3x the deposit for each tenancy and also return the deposit itself. Ouchieeeee! Not to mention, you’ll also be unable to serve a valid Section 21 notice, which is arguably a shit-ton worse on every level!

If you’re sitting there hearing screeching noises as your stomach is avalanching out of your anal-cavity, and with your hands over your eyes and gob wide open, because YOU KNOW you’ve failed to comply, you may want to read the stone-cold reality of your situation over at the ‘I haven’t protected my tenant’s deposit‘ blog post to help plan your next move. I’m sorry to say, you’re in a pretty unforgiving situation, so the options ain’t pretty.

In short, if lady luck is on your side, your tenant’s kind nature or ignorance will allow you to tip-toe away unscathed. But ya’ know, if they eventually cotton on… don’t be surprised if your ‘perfectly reasonable tenants’ quickly turn against you and suck-the-living-shit out of you after uncovering the treasures that await them. There’s something very zombie’ish about tenants turning once they become enlightened.

My tenant is threatening to take legal action against me, what can I do?

Important disclaimer: before continuing, I must clarify, the following is NOT legal advice. Say it out loud, “NOT LEGAL ADVICE”… SAY IT!!! If you’re after professional legal advice, please speak to an extortionate Solicitor that specialises in landlord law. The following is purely based on personal experiences and hearsay…

If you’re currently caught in the cross-fire, the odds are it’s because your tenant(s) has discovered you’re ripe for prosecution due to your failure to comply with the tenancy deposit legislation. With their beady little eyes firmly on the prize, they’ve probably contacted you demanding compensation, typically somewhere between 1-3x the deposit value. Of course, it’s almost always x3 because they’re ambitious, they want the jackpot, and after a chat with their mate down the pub and/or doing their ‘online research’ they probably believe that’s what they deserve can get away with. And hell, why not reach for the stars? But what’s most worrying and disappointing is that many tenant’s chase after the easy money despite the fact they’ve benefited from a perfectly reasonable landlord throughout the tenancy, so that’s why many landlords are often caught blind-sided by what is quite frankly, daylight robbery. They may as well have posted this through your letterbox:

give-me-money

I can only urge all tenant’s in that position to side-step and forgive by asking for the deposit back in full, and then by then making a strong vocal point. Hopefully, lesson learned.

With that said, the following advice is suitable for those good landlords that are genuinely being taken advantage of by the money-grabbing parasites that don’t have the moral fibre to put their foot on the brakes…

Ultimately, your objective at this point should be to avoid Section 214 Housing Act Deposit Protection Penalty Sanctions.

Bu…bu… BUT my asshole tenant has also breached their tenancy obligations!

Ok, I hear this all the time! What a classic.

At this point, many landlords will frantically splash around, trying to kill the situation by pointing out their opponent’s shortcomings (i.e. “my tenant has fallen into rent arrears”, “my tenant shat on the carpet” etc), hoping for a ‘get out of jail card’. Unfortunately, focusing on someone else’s wrongs to mask your own is as embarrassing and futile as it sounds.

You need to understand that you’ve been a rat-weasel, you’ve done wrong. You are liable for prosecution, so right now it’s only a question of how little you pay.

Minimising costs & Settling

Ok, so… credit where credit due, the following is largely taken from Comment #226 over at the “I Haven’t Protected My Tenant’s Deposit, What Should I Do?” blog post, by an extremely generous, experienced and knowledgeable contributor, David. So a big thank you very much! The following will be a hybrid of David’s sound advice and my own toxic interference…

The reality is, the tenant just wants paying off; they usually have no intentions of escalating the situation to court (because that can be expensive, not to mention a whole heap of hassle). What they want is some free money, and the legal threat is an attempt to reduce you into a whimpering little girl and lure you into submission.

You have three options:

  • Pay what they demand
  • Fight in Court
  • Negotiate

If they’re asking for just 1x the deposit, it might be wise to begrudgingly pay up and move on with life, with the experience of knowing better for next time. No doubt, that might still hurt like a sledgehammer to the nuts, but it really is an easy escape from what can potentially be a very firm and prickly grip. However, if the amount they demand seems totally unreasonable (you may want to assess your performance as a landlord at this point, and be honest with yourself), negotiating is usually the way to go

After receiving the threat, you should respond swiftly. You should write your response knowing that a Judge or Mediator may look at it; that means you will want the Judge to see that you are the fair and reasonable person, while the tenant is nothing but a bumbling buffoon, using the Court to decapitate your wallet for some easy cash.

You should start with a letter expressing your complete astonishment and surprise. I would send something like this:

Negotiation Response 1

Dear [Tenant name(s)],

I was most perturbed to receive your letter before action considering I felt that we had a good Landlord and Tenant relationship, with no major problems on either side.

To be honest I was in complete astonishment and surprise because your letter before action was not preceded by any claim, nor a Part 36 offer of settlement, nor any suggestion of mediation.

I do regard this threat of legal action as vexatious and without merit, but I would like to keep things amicable and avoid wasting the Courts time. I am reliably informed that a Judge would view this for what it is; a frivolous attempt to extort money from me, using their Court in an inappropriate way.

At this stage I would like to ask you to reconsider your proposed Court action and agree a settlement with me; that being a positive letter of reference and the sum of £[insert low-ball offer, less than half of 1x deposit] as a gesture of good will with no liability accepted as full and final settlement of this matter.

I hope that you give this kind offer your serious consideration.

Yours sincerely,
[Landlord]

The low ball offer is to bring the leech tumbling back into reality (assuming their initial settlement fee was OTT). They will most likely reject your offer, which should definitely come as no surprise, because you’re dealing with a donkey that’s an utter chancer. In any case, now you’re dancing/negotiating. In response, they may ask for 1x the rent, which you may want to settle with, but they may play hard ball and ask for 2x the deposit. If they do the latter, I would reply with the following:

Negotiation Response 2

Dear [Tenant name(s)],

I am in receipt of your recent offer to settle this matter for 2x the deposit. I am sorry but I cannot accept this as the facts of this matter do not reflect the gravity of such a sanction.

There was no animosity between us, any repairs were carried out promptly and overall I was an excellent Landlord. I am reliably informed that a Judge will take into mitigation the fact that I am a novice Landlord, [and that I quickly protected the deposit in an approved scheme as soon as I became aware of my unattended oversight].

I have refunded the deposit to you in full despite the fact there were a number of issues with the way you left the property that were beyond wear and tear. I did this because I thought we had a good landlord/tenant relationship.

As I explained recently, I feel it is grossly unfair that you try to extort money from me, and whilst I am keen to keep things amicable, I will only agree to a settlement that is fair and reasonable. To this end I am prepared to provide the positive reference offered previously and increase my offer to £[no more than 1x deposit] as a gesture of goodwill in full and final settlement with no admission of liability.

I hope you will give this serious consideration so we can end this unnecessary hostility.

Yours sincerely,
[Landlord]

They may accept or they may try again. In any negotiation you have to give small amounts slowly and usually in response to something given by the other side. They will no doubt give reasons for why you should pay more, but if they don’t, then they are really showing they are weak. SO WEAK. WEAK LIKE… I don’t know… weak like your stomach after digesting an out of date pork-chop.

So be ready to offer incremental amounts, and then a final offer of no more than 1x – 1.5x deposit (or whatever you’re comfortable with), because at some point you have to draw a line in the sand and be prepared to call their bluff. It is your money and your risk appetite that matters here.

A Judge can decide anything they like within the legislation, but a lot of them get pissed off when it’s obviously just about the money (which is often the case). They have a huge case load; some may even kick the case out and force you to go to mediation. They may even say the tenants have to pay for that because you have tried 3-4 times to settle (that’s why it’s important to try and fairly negotiate).

This is ultimately a game of poker, your tenants know you have a potential liability, but you know you have mitigation; depending on their case, they may not get costs unless this goes to appeal, and that is going to be expensive for them upfront with no guarantee of success. That can be a powerful deterrent for the donkey to proceed.

If a settlement is agreed

Hopefully a fair settlement can be agreed. If that’s the case, it should be documented and laid out with a heading of “Settlement Agreement”, and it should clearly state that the settlement is the ‘full and final settlement’. The document should then be signed by all tenants. I’m currently working on getting an example Settlement Agreement as an early Christmas present from me to you, so sit tight for that! It’s all about love around here.

Correspondence

It’s important to send all correspondence through assured means. That could include all of the following…

  • Sending letters with recorded delivery
  • Delivering a copy by hand through the letterbox, while video yourself doing it
  • Sending it via email with a PDF version attached for good measure. The subject of the email should be “Formal Response to Letter before Action”

Every case is different

The problem with these cases is that they can come from 20 different angles; and the law has been amended so many times by statute and case law that it is a dog’s dinner. So while the advice above may not be entirely relevant or fitting to your particular case, I think the key takeaways are:

  • If you’ve been a good landlord, negotiate… do everything you can to settle!
  • If you feel your tenant wants a reasonable amount of compensation from the offset, you’re probably better off paying and considering yourself a little lucky sausage.
  • Ensure you are being fair and reasonable at all times; suppress your anger and frustration if you need to.
  • Always respond quickly, and send all correspondence through assured means.

Before deciding to take legal action!

A word of caution to any Landlord or Tenant thinking of taking legal action; it can cost you £8k to £10k if you get a belligerent opponent who takes this to appeal, employs a barrister and wins. So to emphasise…. the purpose of this blog post is to encourage all parties to settle, settle, settle!

So, anyone going through this dilemma, or been through it? What’s your story? Can you provide further advice? TELL MEEEEEEEE! TELL MEEEEEEE! xoxo

389 Join the Conversation...

Showing 339 - 389 comments (out of 389)
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Kishore 1st March, 2020 @ 12:50

If a tenancy is ended, deposit returned ( Full ), how much time or period one has to sue his landlord that prescribed information not served??

Just for readers I am landlord here.

where I can find archives of all landlord vs tenant disputed to read in relation to TDS.

Suggest a best land lord lawyer please.

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David 1st March, 2020 @ 21:36

@Kishore

6 years or 12 years in special circumstances, for example I have seen a case where the tenant asked for 12 years because they had a long tenancy and did not become aware of deposit protection legislation until after they left the property, they were in the property for 9 years and the Judge allowed it.

Under current law the tenancy being ended and the deposit returned is not relevant except to show conduct, previously you could not bring claim if it was returned.

I am not sure what archives you are expecting, these cases are mostly heard in County Courts and these are not filed in any archive that you could search, also they would not related only to TDS but to all of the authorised deposit companies.

It is better you ask the question or if you are concerned because you have a live case then use the forum to contact me as described in previous posts. You can use google of course, or you can scroll back through years of questions on this blog post.

The best Landlord Lawyers are going to depend on the circumstances of the case, with PI it is hard to prove a negative so you as Landlord need to provide evidence which usually means a signed copy of the PI, some tenancy agreements embed the PI into their tenancy agreements but miss bits out which can make it void.

Sometimes it is better to settle a dispute before you end up paying between £350 and £750 per hour for the lawyer.

There is a window of time between when a Tenant considers bringing their own claim and when they use a claim company, once it gets to a claim company you are on their time and paying for every hour. If you write them a letter, you pay for them to read it, if they need to reply, you pay again. In fact in my opinion they drag things out to get the highest costs possible.

If a case goes to Court and you can be shown to have been a rogue landlord or if a Judge is just annoyed you let it get that far you can get 3x, it all depends on the Judge you get on the day. I had seen Landlord who have intimidated their tenants push the Judge toward the tenant, even asking them if they are asking for an adjournment to add further action.

Other Judges will look at the gravity and consider the culpability, the later it was done, or if it was not done for several tenancies or if done just before issuing a S21 notice work against you.

While if it was done at the earliest opportunity, a few days after the 30 days then the Judge is likely to award 1x

Court procedures are really important here, I have see Judges punish Landlord and Tenant if aspects of procedure or CPR are not followed.

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Najee 4th March, 2020 @ 11:54

When our tenants originally moved in we paid their deposit into DPS - but we were a little late (38 days after the start of the tenancy agreement).
Two years on, the tenants have now moved out and we've received one of those money-fishing letters from a n-w-n-f solicitors that they have hired, threatening to take us to court over our 8-day tardiness.
I have two questions, and would be very grateful for your kind help.
First, we have genuine mitigating circumstances, since the 30 days covered the Christmas period when we were on holiday with my elderly parents who both fell ill. It's true and we have proof - but is there any room for grace in the application in this law? Would a judge take the marginality of the case into account?
Second, the original contract was for a year and the tenants subsequently signed for second year. Their deposit remained with the DPS - and was therefore lodged within 30 days of the signing of the agreement. From what we can understand, according to the Deregulation Act 2015 section 215, which amended the Housing Act, the second tenancy contract supersedes the first. And therefore we are covered by 'deemed compliance', since the deposit for the latest contract was lodged on time.
So would this be a defence for us?
thanks for your help

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Rachel 10th March, 2020 @ 21:22

Hi
I am a Landlord with a tenant who has been in property in London on an annually renewed AST since Feb 2015. I have a Lettings/Management Agent handle everything on my behalf as I am not living in the UK. The agent is paid for this.
In November 2019 I advised the letting agent that I did not wish to renew for another year come Feb 2020 for another year as I planned to sell the property at end of April 2020. I asked Letting Agent to inform the tenant and give plenty of notice.
On March 2nd I found that tenant had been issued a Section 21 Notice at end of January 2020. Fine. Until I found out from the tenant that she had gone to local Housing Association to get help with finding new accommodation and had then found out that my Letting Agent had never protected the original deposit in 2015! Thus my Notice Section 21 was declared invalid.
Now I have situation where tenant is quoting me the law and saying that I can be penalised 3 x deposit. My Letting Agent has said she will refund original deposit. The tenant is saying I have to pursue a court eviction to get her to vacate.
I have been a totally reasonable landlord and provided repairs, new appliance and even paid for gardening when tenant claimed she was unable to keep on top of the weeds!
So - I have offered tenant a full refund of her deposit as soon as she finds a new place to move to.
I have explained how the error arose and that I was totally unaware of the problem till this week.
I also offered to put her deposit from my own funds into a registered DPS now through until she leaves.
But it seems she now wants to go via legal channels for both eviction from the property and any potential compensation.
What is process for:
a) getting the tenant out as soon as possible (she has not been a 'bad' tenant as such and has paid regularly)
b) seeking redress from my Lettings Agent - the original AST declared that a deposit has been held securely and the letting agent was named as Landlord's Agent on the original AST document.
I have been trying to negotiate and communicate amicably with the tenant, but now the tenant's mother has intervenes and told me I am harassing her!!
I think the tenant intends to move to a different neighbourhood and rent privately (rather than via Housing Association). I said I would provide a Landlord's reference, but am thinking differently now that the tone of the mother has become litigious!
Any advice from you gratefully received.

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David 11th March, 2020 @ 11:52

@Najee

I remember answering your post, so it must be in the moderation queue or you posted the same message on another page.

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The Landlord Avatar
The Landlord 11th March, 2020 @ 11:53

@David
Nothing currently in moderation from you.

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David 11th March, 2020 @ 13:42

@Rachel

First let's get the bad news out of the way, because a whole tenancy has passed it is likely that the award will be 3x the deposit, PER TENANCY (if you allowed the tenancy to roll over into an SPT that also counts as a tenancy. Thus you are looking at

Feb 2015
Feb 2016
Feb 2017
Feb 2018
Feb 2019

You might still be within the 30 day limit for protection with the Feb 2020 tenancy, either way protecting the deposit as soon as you become aware can help in mitigation, but probably for that tenancy.

There is a chance for better news if your Agent provided a full service or told you in an email or contract that they would protect the deposit or if their terms say they will protect it.

If they have taken responsibility it brings two things into play, first is a liability for negligence, so you can sue them for the consequential loss you have suffered, including legal fees. There are some things to do before contacting the agent about this.

Getting the tenant out under S21 means either rectifying ALL failures first, these are shown on the front page of the S21 notice. The most important of these is the Gas Safety which needs to be done within 28 days of the beginning of the tenancy or have an existing one in force that does not expire in those 28 days.

Section 8 is also an option IF your tenancy includes the appropriate notice in your tenancy agreement.

https://www.propertyinvestmentproject.co.uk/blog/section-8-evicting-tenants/#grounds

As you have a live case it is better you contact me via the forum, there we can discuss the best way to deal with the agent, seek a settlement with the tenant and try to avoid this going to Court.

I suggest you use the forum to PM me any more information or questions using the instructions in post 335 above.

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Najee 16th March, 2020 @ 06:52

@David

No, we didn't receive your reply. We were looking forward to it.

I checked and nothing has been received. We posted on March 4.

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David 16th March, 2020 @ 13:33

@Najee

The law does not provide a means not pay at least 1x the rent, there is mitigation and culpability is a factor hence the Judge can vary the amount to between 1x & 3X.

The judge WILL take it being just 8 days and we have case law we can use to show lower courts that it is a factor, but it needs to be worded right.

Dates are critical in this area of Law, generally to make Landlords aware of their risk I advise that if the original tenancy was not protected then it follows that Superstrike applies because one must fully comply with the Deposit Protection for tenancy 1 to get the deemed compliance for tenancy 2.

I have seen this argument made and won in Court, however, a few have won on the deemed compliance.

I can help you draft a reply to the claim firm if you contact me via the forum, please use the instructions on post 335.

Do NOT enter into protracted discussion with the claims company, because in any settlement they will try to charge you for reading and responding to anything you write.

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Hodge572 16th March, 2020 @ 19:21

Hey David, could you contact me? I think I messaged you but I really need to use your services with a tenant taking me to court.

Thanks

Oli

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David 16th March, 2020 @ 21:09

@Hodge572

Sorry just realised that the forum is not sending me notifications for some reason

It seems to have a problem with my mail provider, I will try using another.

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Kishor 17th March, 2020 @ 12:03

Can we not make a awareness campaign and also try to high light this issue and run a petition for the law to be amended.

How can a tenant who leaves happily and after sometimes decides that his deposit was not secured and he gets worried.

We need to raise this at all possible forums that some people who had no physical emotional and financial harm sue a landlord.

Even if Law need to penalise landlord they can fix A token amount like £200 max for no harm so that all such petitions to go down and court can take up serious stuff.

Or we all victims can collect funds and file a petition and get a decision to challenge this law.

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David 18th March, 2020 @ 11:49

@Kishor

Actually I think the law has it about right just now, when the original legislation originally came out you had 14 days to protect, it is now 30 days, the law has been amended numerous times, there are now 4 laws and statutory instruments that govern Deposit Protection and a plethora of other related laws that also impact it, such as gas regulations. The most recent change (which made it better for Landlord) was enacted in October 2015.

This legislation has been in place since 2007, that is 13 years of awareness, Landlords have a plethora of legal obligations and it is their responsibility to make sure that they comply to all of them.

Judges recognise that any tenant can be the weaker party in the landlord tenant relationship, they are often so desperate for accommodation that they will sign anything and then so worried about being evicted that they will not complain. Anyway the Limitation Act applies and gives them 6 years to file a claim and 12 years in some special circumstances.

It is NOT the tenant who "sometimes decides that his deposit was not secured" it is a legal fact, if the deposit was not protected the sanction which is a statutory penalty applies.

You are wrong to say the tenant has no harm, it costs NOTHING to get your deposit protected with the DPS or a small fee if you wish to keep the money and use an insurance based scheme. The harm is firstly that a law that was designed to protect tenants is being flouted, secondly that something might have happened to the Landlord and/or Agent who have their deposit. So they were at risk and that is the harm.

If you drive a car without insurance you are still liable for prosecution, you can't say "I did not hit anybody" as your defence.

What I am STILL seeing every week is landlords who think the deposit is a redecoration fund, an improvement fund or just something they can dip into. I had one recently where the deposit was over £8000 and the Landlord wanted £9000 of repairs that were literally fair wear & tear for the most part.

In another case the Landlord did not protect for three tenancies until after the 3rd one expired and the tenant had left the property, they then took 2 months to pay it back. This caused financial hardship and to add insult to injury they helped themselves to some of the deposit and would not communicate when it was disputed.

A token amount will mean token compliance and make it far far worse. Such a comment Kishor suggests to me that you do not take your legal obligations seriously. Yet the serious penalty you pay WILL make you take it seriously.

If you start a petition to change the law you might see it being changed to make things more draconian, so be careful, because for every landlord organisation there is a tenant organisation and they are far more professional at lobbying Government.

The solution to this problem is to get professional, comply with your legal obligations.

Is there room for improvement, perhaps yes, by biggest gripe are the claim companies who are using this legislation to put a gun to the heads of Landlords which says "pay up now or pay £8k in legal costs by the time we are done with you". When you trace these claims companies who each use a panel of solicitors what you find is that they are insurance companies, they are essentially gamblers.

I think these companies and the firms they use bring the legal industry into disrepute, what I would like to see is for the Government to extend the remit of the claims regulator to ALL "cookie cutter" type legal claims.

I would also like to see the SRA take a much firmer stand, I regularly see claims from firms who are generating legal fees by doing unnecessary work and charging obscene rates for it. The problem for Landlords is that is costs money to fight these and because you did not protect the deposit they know you will lose the case.

That is why I have a prescribed way of dealing with these firms, but you still get maverick firms or vexatious tenants, honestly I could tell you about cases that would terrify you.

Also you should be aware that there is something far more worrying than deposit protection and that is licencing failure. Previously this was a matter for Councils and it was usually Councils that brought the cases.

Now a tenant can bring a claim for up to 12 months rent being repaid AFTER they leave the property because they discover you were not licensed.

Again I have no problem with this in principle except how it is being used by certain firms and some individuals.

The critical point for Landlords is that you may have a property that has recently become part of a zone that the Council deems requires a licence or more worryingly that you inadvertently have a change in the configuration of a property or the relationship of tenants is misleading.

Previously if you made a mistake on licencing the Council would give you a smack on the wrist, usually they would be fine if they could see the requirement was recent and/or if there was something they could see was not your fault. Worst case used to be a £500 odd fine for the involvement of the Council, while now you might see a property renting for £2500 a month giving you rent repayment order of £30,000.

So the answer is to make sure you comply with the law or employ and agent and make sure you have an extremely tight contract with such an agent about their obligations.

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Rebecca 30th April, 2020 @ 09:57

Hi David,

I'm hoping you might have some advice for me. My husband and I were renting a place where we prepaid 6 months' rent, but the lease was rolling, so we were assured many times by the real estate agency that we would be refunded additional rent if we moved out early.

We ended up having to leave early when coronavirus broke out (we had come from overseas and needed to get home before borders closed), leaving 3 months' rent due to be refunded after our 28 days notice. It is now a month past the end of the 28 days notice, and we have heard absolutely no response from the real estate office, even though we've contacted four separate people from that office as well as from the head office. No confirmation that they retrieved the keys we left in the flat, no confirmation that we would be refunded our additional rent, no confirmation that the inspection had gone ahead and we would be able to receive our bond back (which is also a month overdue now).

From our understanding, some branches have closed completely due to covid, and inspections might not be possible to carry out at the moment. However, we really do need the money back (about 2k total) since finances are tight on our end, and we think it's unreasonable that we haven't even gotten an email back so far.

We want to take action if the company continues to ignore our attempted communication, but we don't know what the next step would be. What would you advise?

Many thanks.

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David 30th April, 2020 @ 11:50

@Rebecca

I am going to proceed on the understanding that this is a UK property and UK Estate/Letting Agent.

I see two serious mistakes in your story so far

"we were assured many times by the real estate agency that we would be refunded additional rent if we moved out early."

This is really unusual unless it was a holiday let tenancy agreement, if it was an Assured Shorthold Tenancy they almost always have a minimum term and break clauses.

Whilst verbal contracts are legally binding you do need some evidence, an email confirming what was said

"are you sure the landlord will refund us rent if we moved out early as you suggested in our viewing today"

They will deny it and refer to the contract you signed, so if it has a minimum term that contradicts what you allege you will have a problem without evidence.

Normally if you abandon a property a Landlord can only hold you for their actual costs to replace you, this might be a small amount, agent fees etc.

However in the lockdown they may well try to argue they could not rent it as the agent had furloughed their staff. One might argue they could rent it in a week after a deep clean (that you would pay for) and putting the property on Open Rent.

The second problem you have is that you abandoned the property without first making some sort of engagement with the Landlord or Agent. You have no evidence you sent the original email (unless you cc'ed it to another email you control so message headers may be used as evidence of sending, you left the keys in the flat, so they can say they never received your notice, had no reason to contact you or enter the flat.

You might try to trap the Landlord into an admission of being informed of your departure. It would need to be a very vague message like

"Dear Andy

Sorry to bother you, we emailed XYZ agents on X date, but have had no response, have you heard from them? I even contacted their head office with no reply."

That is all you say, keep it as brief as possible so he fills in the gaps.

Right now it is in their interest to not respond and deny receiving any notice from you.

Depending on the response of the Landlord you have several choices, if they deny knowledge of anything, you can issue your notice by snail mail and email to him now, making note that you are reserving notice already provided to his agent.

If he says they got the notice, but it was invalid as the contract has a minimum 6 month term and cannot be terminated except under terms of the contract. I would need to see that contract to say more, so you would need to contact me via the forum to do that, (please use the instructions on post 335).

If he says he got the notice but Agent holds the money or he can't pay you as he is broke then you can use that to justify a letter before claim, then issue a money claim online.

If your tenancy was an AST and you paid a deposit then that deposit will need to have been protected in accordance with the S213 to S215 of Housing Act. If not done properly then you have access to a claim. These do not apply to genuine holiday lets.

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Rebecca 30th April, 2020 @ 22:44

@David

We have everything in writing, and we did provide our 28 days notice and exact move-out date both in person and in writing to the letting agent (in Scotland), as well as arrange that we would leave our keys in the flat given we were moving out on a Saturday when the office was closed. I just think we have gotten no communication because the office may have closed due to covid starting that very weekend, so things have been redirected to the head office and possibly overlooked.

And the refund we are due is laid out in our contract. The wording is as follows:

"This tenancy may be ended by:
* The tenant giving notice to the Landlord--the tenant giving the Landlord at least 28 days' notice in writing to terminate the tenancy, or an earlier date if the Landlord is content to waive the minimum 28 day notice period. Where the Landlord agrees to waive the notice period, his or her agreement must be in writing. The tenancy will come to an end on the date specified in the notice or, where appropriate, the earlier date agreed between the Tenant and Landlord."

And later on, "Notwithstanding the Principal Terms in respect of the rental payments, the Tenant agrees to pay the sum of (...) in respect of the tenth day of January two thousand and twenty to the ninth day of July two thousand and twenty.

It is hereby agreed between the parties that should either the Landlord or the Tenant wish to terminate the tenancy in accordance with the conditions of the Agreement prior to the ninth day of July two thousand and twenty, the Landlord agrees to refund any overpaid rent to the Tenant on a pro rata basis."

Our deposit was properly protected (it was a residential flat, not a holiday let), but the terms of receiving our deposit back was that the letting agent had to conduct an inspection at the end of the 28 days, after which point they would start the process to release it--so we can't currently do anything until they confirm they've done the inspection, which might not be possible at the moment.

We actually just got an email back from the head office yesterday, after two months of zero contact, so we may be making some headway. Thanks for your help!

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Lewis 25th July, 2020 @ 00:13

Hi, I’m a landlord and and I recently received a letter from a solicitor, stating that my former tenant is claiming the deposit plus 3x for not protecting the deposit. The tenant and I had a really good relationship and they always paid their rent and kept the flat tidy and left everything in good order when they moved out. Now I hold my hands up here, my tenant had an initial 6 month AST agreement, which I protected, then after that it rolled on as a periodic agreement I forgot to protect it. Fast forward 1 year, my tenant moved out, because they caught me going into her flat during lockdown without getting permission first. Embarrassing I know, but I apologised but the tenant said she didn’t feel comfortable remaining in the property. They have also added on a claim for council tax as I agreed to pay this bill if she paid a higher rent, but as I am in dispute with the council over the banding, I haven’t paid it for six months. The tenant has since paid the council directly as she said she was concerned because the council were demanding payment and the account was in their name.

I have been a bit slack recently due to personal issues and the tenant tried to contact me via phone, text and email but I never responded. They were trying to reach an agreement with me because they wanted to break their tenancy early but I never responded and I kept the deposit as they didn’t give the required notice period on their notice to quit.

What are my options here as in total their solicitor is claiming for the deposit, even though they didn’t give the right notice, 3x the amount, the council tax bill and solicitors fees and interest. Can I argue that my tenant didn’t give me the correct notice?

Any advice would be appreciated.

Lewis

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David 25th July, 2020 @ 10:59

Hi Lewis

How we deal with this will depend on the actual evidence, but I can give limited advice based on what you said above.

To be honest yours is a case of what NOT to do.

The tenant is entitled to quiet enjoyment of the property and your sneaking in is totally unacceptable for ANY reason. I am not surprised she felt the need to leave and I would not be surprised to see a request for her costs in this regard.

The fact that you have not returned deposit already is a guaranteed way to piss her off and push her into the arms of a claims solicitor. Especially when by your own admission she left everything in good order.

You say that you say that you protected the initial 6 month agreement, if you did this properly and served the proper Prescribed Information BOTH within 30 days of receiving the deposit then as long as the tenancy started after Oct 2015 the Statutory Periodic Tenancy would not need to be protected.

It is all going to depend on your evidence of her receiving the PI, because if you fail in full compliance of the law in the first tenancy and do not rectify such a failure within the term of the first tenancy, then the failure applies to both with a sanction for each.

Again the claim for Council tax is your screw up, your dispute with the Council is not her problem and may lead to bailiffs turning up at her door with huge extra costs.

You then made the fatal mistake of sticking your head in the sand when she tried to contact you.

You had no right to keep the deposit, in fact I would not be surprised to see her bring further claims against you. These days you can get a new tenant in hours or days at worst, especially as you say she left it in good condition.

You made this poor tenant feel unsafe in her own home, you exposed her to one of the nastiest debt recovery tracks and they allege that you did not comply with the law with regard to her deposit. You held onto her deposit with no apparent tenancy damages. Then when she tried to resolve it out of Court you do not even give her the courtesy of a reply.

A bit slack is an understatement, if you are not going to be professional then get out of the Landlord game or employ an agent on a full service agreement, so any failure is theirs.

You can argue that your tenant did not give you the correct notice but if I was claiming against you I would be bringing a claim for her costs for having to find a new property, if she left the property immediately she may have claim under a daily rate of £350 per day until she was able to secure another tenancy. If your property is in a licensed area or had a requirement to licence and you failed in that she can claim 12 month rent repayment order.

You screwed up and now you are quibbling about the lack of notice, you have already seen their costs. If you get into a discussion with them the costs will exceed the deposit and you will end up paying it anyway.

If this goes to Court there it is highly likely you will get the maximum 3x sanction as your culpability is on that level and the witness statement is likely to paint you as some sort of pervy landlord sneaking into her home to smell her knickers and breaching her quiet enjoyment of the property. I know one Solicitor in London who has claimed all previous rent paid on this basis and got it.

Normally in these cases I am able to negotiate the claim down to 1x the deposit per tenancy based on certain case laws. However, it will depend on the evidence I see. So far it does not look good, unless there is evidence (including PI's signed by her) of full compliance within 30 days or at least within that initial 6 month term.

Usually the claims firms stick in a part 36 offer, if they did this and based on what you have said I would bite their hand off by accepting the offer, returning the deposit, paying the Council tax and their costs. I would add a heartfelt apology once the settlement is concluded.

As this is a live case, if you require further advice I suggest you use the forum to PM me any more information or questions using the instructions in post 335 above.

I hope other landlords can learn from your mistakes.

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Grumpy 25th July, 2020 @ 11:22

David,
I was waiting For you reply to that, you were too kind to him 😆😉 An example of why landlords get a bad name, yet to still offered to help him. You must be related to mother teressa.
Great advice as usual.

Grumpy

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Kalai 19th August, 2020 @ 16:19

Hi, my landlord mentioned in the agreement about TDS but he did not deposited till I found it, it was after 18 months, after sending him a mail, he said he missed he agreed to adjust that from one month rent, still some close to 100 pound with him.

this all started when he started asking more money for internet fees after 18 months he realized that he is not charging for internet fees, but all bills included as per agreement and I refused to pay

since then he is into very aggressive mode and charging more more more money in the name of damages, actually I cleaned the property very neat and not such damages. I told him many times, take this legally such that TDS to decide. But still he is writing mail to me telling he will go to court and threatening me.

1) He never/not deposited to any protection scheme as he mentioned in the agreement.
2) He did not pay my deposit in full, 10% of my deposit is still with him
3) Before i left the property, he tried to enter my house without my permission and we had an argument, after started taking video, he left, but his face is recorded.
4) He is simply adding more list and demanding more money in the name of damages
5) I left the property with no rent areas in fact for notice period I paid extra 15 days before I leave

still do you think landlord can move to court? or can I take a lead and send him the legal notice?

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David 19th August, 2020 @ 16:38

@Kalai

I have seen this before and I can help you with it, I am sure that with the right approach he will settle and if he does not he will face sanctions which are paid to you.

As this is a live case, I suggest you use the forum to PM me any more information or questions using the instructions in post 335 above.

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Najee 20th August, 2020 @ 01:49

@Kalai
Just a word of caution.
Be careful on taking free advice - no matter how well intentioned the offer is.
It can lead to a lot of running and around hours of aggravation, without getting an outcome or even being reliable.
Anyone offering free advice is under no obligation or liability to provide you with a professional service.
They are doing it for free - often out of good and sincere motives.
But still you may end up regretting it.
This all goes without saying, but just as well to always bear it in mind.

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David 26th September, 2020 @ 17:15

@Najee

I have to say I find your comment quite ungrateful.

The running around and aggravation were basic instructions that 99% of landlords and tenants complete in 24 hours. Of course if you can't follow instructions or there are hundreds of messages that may or may not be relevant, that is not my fault.

I do not know what your expectations of OUTCOME were, but you screwed up the protection of your deposit and the MINIMUM you would face is 1x the deposit PER TENANCY, that is the law, it has been made clear in the blog post above and in the messages to others.

My best result for Landlords has been to get a tenant 6 months in arrears out of the property in 4 days, I recently helped a Landlord dismiss a void claim and we got the tenant out despite all the Covid protection, with no court action and zero payments to anyone, including me.

Your claim was NOT void so it became a matter of getting it as low as possible, but you were already being offered a 1x settlement (which you did not make clear earlier) so I explained to you that you would not do better in Court. It was reliable advice.

You are right that anyone offering free advice is under no obligation or liability to provide you with a professional service, but I do my best, based on the priority of the case. Some people are facing homelessness, others face £30k claims, I take no sides, I just try to help those who ask.

The best Tenant result with no Court Action that I have had was 9x deposit settlement because the failure was so egregious, but the Landlord did not have to pay.

I do not know what you had to regret, perhaps you were expecting not to pay for breaking the law.

These cases can drag on, the longest is two years but I had one that would have cost the Landlord £10k in legal fees in three Court hearings, it took 9 months of fighting a totally spurious claim. It was settled with no sanctions paid.

So really count yourself lucky, you got free advice, you did nothing other than provide the evidence. Once reviewed I was able to advise you that you were already only facing the minimum. So sorry but it was your failure to comply with deposit protection, not mine and you were caught.

Your message does not really apply to the person you were aiming at unless you were just trying to put a tenant off from making a claim.

Anyway, I am sure that now that you have had to pay for your mistake you will remember to protect your deposit and comply with the law, which is the purpose of the sanctions.

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John O 6th October, 2020 @ 05:12

After 4 years, 2 AST and periodic since 2018, my tenants have served noticed and due to leave at the end of October. They are not allowing me to visit the property at all, let alone bring any potential future tenants to view the property before they leave due to COVID-19 concerns. They are in arrears by nearly 1k due to being on furlough. Is this fair? Also, I've noticed that I only protected 2k of their £2100 deposit with DPS. Surely a £100 shortfall won't open me to a legal claim by them?

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Anon 6th November, 2020 @ 08:12

Sadly, it's becoming more commonplace for landlords to shirk their responsibilities and go back on promises.
I recently moved into a property (2 weeks ago) and have encountered nothing but lies, broken promises and problems and sadly, due to demand and facing homelessness I am paying 20% above the average rent for my area due to landlord greed for a substandard property after a promise of remedial work prior to moving in was not done.
My deposit has not been paid into a protected scheme (despite the tenancy agreement stating it would be paid in within 14 days).
The boiler (33 years old) is temperamental at best and the landlord has refused to replace it.
He 'decorated' as promised (by decorated, he has whitewashed everything with emulsion - ceilings, doors, walls, kitchen, skirting - everything, not a sight of colour or gloss paint anywhere).
The toilet broke after 2 days of moving in, it took him a week to sort that.
The conservatory has no heating whatsoever and gets damp and freezing so cannot be enjoyed.
Cheap and rogue landlord through and through. Another one looking to make a fast buck.

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David 22nd December, 2020 @ 01:29

@John O

Sorry for the delay in replying, not been getting notifications.

Just as a payment holiday from your mortgage company does not absolve you of paying your mortgage nor do Covid19 issues absolve a tenant from the obligations of the lease.

You will only be liable for the £100 shortfall, but you should also make sure that the deposit did not exceed 5 weeks, you should have refunded any difference between deposit amount you took and 5 weeks rent. Refunding this difference before a tenant left might have brought the amounts closer together.

If you failed to serve the prescribed information then you would be liable for between 1x and 3x the full deposit.

The deposit is protected for the performance of the tenancy so you can deduct their arrears from the deposit by making a claim with the deposit protection company you used.

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David 22nd December, 2020 @ 01:48

Anon

You can bring action regarding the failure to protect deposit but I would advise you wait until you leave as the liability may continue onto further tenancies.

One assumes you had a viewing and were aware of the state of the property.

You could write to the landlord with a list of issues that differ from when you were shown the property, this puts them on record.

You could also use these shortfalls to negotiate a reduction in rent or you could use the pandemic to negotiate a reduction in rent

https://england.shelter.org.uk/housing_advice/private_renting/how_to_negotiate_a_rent_reduction_during_the_coronavirus_outbreak

Having said that, a 30 year old boiler is not a problem if it heats the main part of the property, I have never found a warm conservatory at this time of year, even those with underfloor heating and special glazing. Best thing you can do is close the doors to it.

If and when you decide to take things further regarding the deposit I suggest you use the forum to PM me any more information or questions using the instructions in post 335 above.

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Oliver 26th December, 2020 @ 01:25

Hi, i recently received my "no win no fee - Injury lawyer specialist papereork" claiming that my tenant, (now vacated) had not received any acknowledgement of there deposit being protected!

I had used an agent to find my tenant, they did all the checks and legal bits, secured one months rent and transferred me over there deposit. I then secured the deposit the very next day with (TDS) and forward to the tenant the certificate and (PI). I asked that they would sign the (PI) and send this back via post, hand mail or email the signed document. And of course received nothing! I called, left messages and visited the property all to no luck.

They moved into the property at the back end of Mat, and in the AST I stated that I would make a quarterly inspection on the house. So my inspection would be in September. The tenant eventually answered my call, now closer to the I section month and said that they had not received any documentation relating to the organisation that I had used for there protection? I simply replied not to worry, as I shall bring the copies for you to have and read through the (PI) then sign keeping your copies and mine for records. And this is exactly what we both did. Now five years later and with there £650 deposit returned I'm faced with legal action, and completely out of the blue claiming they never had paperwork or signed documentation. However I have there signatures, dates and documents in my possession. The no win no fee solicitors are demanding payment of £1950 to be made within 16 days or else face there legal fees and court action! The letter states I cannot contact the tenants or I'll breech another condition to the live case, and that i cannot call or discuss the matter directly with the solicitors the tenant has gone along with? Any help would be great. What a Christmas!

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Grumy 26th December, 2020 @ 09:31

Oliver,
If you have paperwork they signed then I very much doubt you have a problem. Your ex tenants probably “forgot!” they signed it and told the ambulance chasers this hoping you Lost your paperwork and cannot prove it.

They don’t want you calling the lawyers cos that will mean work for them.

You will likely get a reply from the resident expert on here soon.

Try not to sweat too much.

Grumpy ex landlord
(Where is my emoji?)

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Oliver 26th December, 2020 @ 11:00

# Grumy

Many thanks for your reply, I really enjoy being a good honest Landlord. My Certification, licences, tenant Check-ins / Check-out records are meticulously maintained and recorded for these very reasons.

I do believe they have forgotten they had signed my paperwork! And what a relief I have the (PI) SIGNED! However what does concern me is that the (PI) was signed beginning of (September 2015) - (my first 3 month inspection) when there deposit was received on (June 8th 2015) and was regustered with the "TDS" the very next day. As explained I had sent them the attachments with an email that I myself are sent across from the "TDS". They failed to return me my copy signed by post, hand mail or email. I couldnt even get hold of the tenants, as I had left messages for them to call me! Eventually, after eight weeks I received a call of them explaining to me they were sorry they hadn't been in touch sooner and that they had not received such documentation. So I said that I would bring them over to have, sign the (PI) and you keep a copy and I shall also. That however makes the (PI) signature look (90) days late! However I still have the emails, and certificate of proof with the date i placed their deposit within the (30) allocation which lawfully requires me to secure the deposit with a government recognised scheme!

Just also to let you know, I had no trouble with the tenant what so ever! Very kind, polite, and extremely obliging. I did however have major difficulties getting firm dates and availabilities to get my inspections carried out and ensure good upkeep and also that my long standing resident neighbour was also having a pleasant experience living next door with my tenants, (she was, thankfully)! This may be all planned I fear! It's so easy to delay paperwork, claim it's missing, and just suggest tenants never received anything for other landlords to endure a slippery road of claims! However I will obsessively state that importance to relevant legislature, signatures for legal documents are maintained and collected, however nice, polite, caring calm and collected people may appear! It's a tight world of income for many at the moment and a free pay check through a lapse of concentration/ document being mis laid may lead to your bank balances becoming stretched this also! However I have the copy and also there signatures!

Let me know if this N.W.N.F solicitors have any opportunity to demand payment like this in any way! It seems fraudulant activity and of course shall take this to my solicitor when they re-open, but they wont be open until after the deadline date of (8th January) to cough up my childrens inheritance!

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Grumpy 26th December, 2020 @ 13:34

Hi Oliver,

In my opinion, if you used the deposit protection company and they issued records and showed it was protected, then they have no case. DO NOT pay them anything.

Just because this would have annoyed my greatly I would send the Ambulance Landlord chasers a letter saying you complied with requirements of the DPS and their clients have been giving them false information.

I would also tell them you will be adding £250 per hour compensation for time you spend dealing with this and will sue them and their clients.

You you want to, you could send a copy of the deposit protection certificate proving you placed the deposit with the DPS.
Their Lawyers will likely drop this like a hot potato.

Their "deadline" will likely be simply a scare tactic and will have no bearing on this. They WANT you to pay up with minimum fuss just by scaring you into paying. If you protected the deposit you owe them nothing.

The tenants might have been nice but when a flyer lands on their door mat saying they can get free money if the landlord didn't protect a deposit they will leap at the chance.

I'm sure David will will pass his more legal and polite opinion.

Grumpy

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David 26th December, 2020 @ 16:49

@Oliver

HAPPY CHRISTMAS!

First of all you have no problem if you have evidence of having served the Prescribed Information, they are on a hiding to nothing.

I hate these firms because they bring the industry into disrepute and sending out prior to Christmas is a tactic that bailiffs and debt collectors use to bully people.

However, it does not mean you should ignore this, I will gladly look over your paperwork with no charge and draft you a letter for them to put an end to this harassment.

Once I have clarified that they definitely do not have a case I suggest we do two letters, one to the SRA who regulate Solicitors and one to your MP asking that such claims are brought under the remit of the claims regulator.

The SRA complaint will focus on the fact that they have a duty of care to verify claims before they make them and before they write these nasty threatening letters. Also that these firms are not following Civil Procedure Rules. It is important to report them because there are certain firms I am aware of who operate in ways to just to hike their fees. If the SRA gets numerous complaints about one firm they will take action.

One thing that people worry about are these imposed deadlines, in the first instance simply drop them a line with zero detail or admission or denial, just saying that you are in receipt of the letter and seeking professional legal advice, which due to Pandemic is likely to take at least a month and so you would be grateful if, in accordance with pre-action conduct they would give you an opportunity to obtain before they bring claim.

Whether it be Tenants or Claim firms, it is important to create an evidence trail, when sending an email put a CC or BCC to a separate email address, the email header of the the second recipient will be accepted as evidence that the message was sent and should be considered as served, This is because the in the header of the email there are date stamps of the servers of Microsoft, Yahoo, Google et al. It is also possible you put such headers in email tools that verify such header information. This is provides better standard of proof than Royal Mail which is considered Service when the Courts issue a claim.

A Judge works on probabilities of who is telling the truth, when presented with such evidence they are likely to come down on your side.

I can help with getting this firm to back off not only with a letter denying the validity of the alleged claim but making sure they do not benefit.

If you really want to smack the tenant and you are absolutely in the clear, then I can give you a method to get this tenant charged with your legal fees, you will not benefit but it will be way to hit back. Tenants jump into bed with these no win no fee firms but it does not indemnify them against your costs unless they get insurance which is very difficult to obtain in such cases.

To other Landlords reading this, change your processes, introduce a delay between collecting the deposit and the handover of keys, it need only be 24 hours, at that handover the first thing they sign are two copies of the Prescribed Information, the deposit certificate, the How to rent, Energy performance and Gas/Electric inspection docs as appropriate. Refer to these in your tenancy agreement and have them as appendices to the agreement. Store these properly for 6 years.

I suggest you use the forum to PM me any more information or questions, using the instructions in post 335 above.

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Oliver 27th December, 2020 @ 11:12

Merry Christmas also!

Many thanks for getting back in touch with myself so soon and of course during the festive period.

I would be delighted to take up your offer with the current allegations I stand to be liable for! Never have I been so wrongly accused nor threatened in such a way of these so called- "injury lawyer specialist" who feel the need to muscle in on some foolish innacurate and deceptive tenants hopes!

The letter is a very much demand letter! Alerting me to not get in touch with themselves or the tenant or further crimes against myself shall be put forward! They simply tell me to get in touch with legal advise or citizens advise! They seem pretty hell bent on claiming myself as being a 2020 landlord law evader, and that now I face consequences of the fines that follow for breaking the law that the tenants have claimed I have done!

As mentioned David, I have signed certificate (& PI) which was sent the very same day I received the deposit and registered it with the TDS. Of course well within the 30 day period. I think it's time that these types of solicitors were brought to justice themselves, as you mentioned they arent following any regulation or guidance on the conduct or behaviour with these threatening attempts of ascertaining monies through partial and fragmentary Hope's from there clients!

I'll start the ball rolling and hopefully slap the wrist of both accusers and legal representatives hands once and for all.

Many thanks.

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David 27th December, 2020 @ 11:55

@Oliver

This is a public forum and (just in case) to avoid prejudicing yourself I suggest you use the forum to PM me any more information or questions, using the instructions in post 335 above.

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Lou 27th December, 2020 @ 12:25

The whole process is unfair with regards to the claims tenants can make as there always seems to be a loop hole for their benefit. Is there any petitions to counter the 3 x claim rights? 1 x claim makes it less tempting for tenant to bother. It does feel like no matter what the tenant is, they are out to make some money from landlords thanks to misinterpretation that houses are mortgaged free and all landlords are millionaires so their claims are justified...

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David 27th December, 2020 @ 13:50

@Lou

I do not think it is unfair, I think it is just about right at the moment in terms of balance between the tenant and the Landlord.

The idea of the sanctions are that they are a deterrent; the full legal obligation has been a requirement since 2007, so there really is no excuse and there are far more draconian punishments that can cost you 12 months rent.

When the law came out it had to be protected within 14 days, this was increased to 30 days so more fair than before for the Landlord.

Then rogue Landlords started cheating the system by providing the deposit protection companies with a similar but false email and telephone for the cost of buying a SIM, this caused the notifications to go to them rather than the tenant. So the requirement for providing the Prescribed Information was brought into place.

Some also used a loophole of giving the tenant their deposit back, sometimes 15m before the proceedings, so the law was changed to say you had to pay even if you returned it in full.

Then we had about 8 case laws that caused no end of problems for Landlords, finally resulting in a virtual deposit being needed to be re-protected even though it was protected.

So in 2015 the law was improved, again for the benefit of Landlords, so that if you protected it properly in an approved scheme within 30 days and you fully complied with the law regarding PI, with the deposit remaining protected for the full occupancy of the tenant, then your deposit was "deemed" as remaining protected.

Right now we have case law that has determined the Judge is allowed to determine the level of culpability and depending on the circumstances, I can get most cases settled at 1x the deposit and often get legal charges reduced or thrown out if there has been a breach of procedure.

At the same time if my client is a tenant and there is an egregious failure by the Landlord to protect the deposit (usually accompanied by a deposit grab or failure to repair etc) then based on the facts I will fight for their rights.

I assess each case on it's merits and help Landlords (or tenants) get a reasonable settlement, sometimes I am able to deflect the liability to an Agent depending on their correspondence etc.

The whole idea is to make the tenant bother so that there IS a deterrent, even after 13 years there are so many Landlords who do not comply and there is no excuse.

You can't really blame tenants who see a website with a calculator and tells them they can get £10k for a mistake their landlord made.

If we were to look at the process, we could change the Tenant Fees Act to make it illegal for a Landlord to take a deposit and dictate that the deposit must be paid by the tenant into an authorised Deposit Protection Scheme themselves; naming the Landlord as the potential beneficiary, then have the Landlord confirm their details plus those of the tenancy. The rest of the system could operate as it does now with a tenant being able to ask them for the deposit back at the end of the tenancy and the Landlord able to attempt a claim which could be referred for adjudication or Court.

It would a small change and like the current system the emails and SMS could be fully automated.

In 2020 a year after the Tenant Fees Act became Law Landlords were required to part refund any deposit over 5 weeks on most tenancies (6 weeks on the really high ones). I do wonder how many have done this.

Being a Landlord is a business, if you are a plumber you have to comply with regulations, have 3rd party liability insurance and so on. It is the same for a Landlord, this site tells you all the things you need to comply with, as do many others.

It is all about having processes in your business with reminders for things like Gas Safety, EPC and so on. If you can't cope with these then you can pay an agent. If you can't cope with signing up a tenant and the legal obligations, pay an agent who as part of their full service offering protects the deposit as part of their scheme with a deposit protection company.

Protecting the deposit is free with the DPS and under £30 if you insist on an insurance scheme, keeping the deposit yourself, but that opens you up to "forgetful failures" where there are requirements by you to re-protect the deposit.

I do not think Landlords should use these "insurance" based schemes. I can't see any benefit in keeping the deposit, it is the tenant's money and you should not be using it for cashflow nor as a redecorating fund for fair wear n tear. If you do a proper inventory before and after you have all the evidence you need to make a claim on a deposit.

The real problem with this area of law is a small number of nasty claim firms or Solicitors who sign a tenant up with a 15m consult promising them the earth. Some hold the tenant liable for their fees if they pull out so they are less likely to agree to a settlement. They charge ridiculous costs and try to get the Landlord to argue with them so that they can rack up more costs. Luckily I have ways of dealing with most situations, but there are a few firms that need to be shown the error of their ways.

It is always better to get me involved before the tenant has gone to a claim firm but either way at the earliest opportunity.

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Grumpy 27th December, 2020 @ 16:05

Hi David,

Again your generosity in helping people out on this blog is nothing short of outstanding.

To throw my pennies worth into the discussion, your analysis of the system as it stand now does seem fair (to achieve the goal it does achieve). I also agree, making the tenant responsible for paying the deposit into the system themselves would make a lot more sense.

However the deposit system is a complete joke.

My suggestion would be make the TENANT pay for an insurance policy. To cover any damage and repair costs. The Deposit protection services would adjudicate as it does now. Any Damage and the Insurance company pays up the FULL repair cost.

Landlord is happy and the (good) tenant is happy.

Of course this will never happen as we might then actually find out how many tenants think nothing of trashing house after house because they would find they cannot get insurance and hence cannot rent a house in the private sector.

As you state the deposit is capped at 5 weeks rent. Apart from the south of the country, the average rents in the UK are between £500 and £750 a month.

Exactly how much damage and repair will £500 cover?

While the vast majority of tenants end up being great, a small percentage are a total bunch of selfish filthy nightmares who cause untold havoc. They have zero respect for other peoples property and can and do, on a regular basis, rack up repair costs that would dwarf the 5 weeks rent deposit by magnitudes.

Smashed electric switches and plugs, bags of ready mix poured down drains, burnt carpets, hair dye on floors, food left around leading to cockroaches, coal in an electric oven, kitchen fires from pulling plugs off fridges and reversing the wires stuck into the wall socket, because someone told them it reverses their electric meter. The list is endless.

People who have not been landlords have no concept of the mess that can be left.

Now while the deposit protection means the landlord will likely get most the deposit back, in these cases it covers almost nothing of the costs. Even cleaning carpets would swallow the entire deposit, let alone replacing them.

And you are right, being a land lord is a business, and landlords as a whole, would be better off if we did not have any “rogue” landlords.

However, its a special kind of business. It’s a business that a huge % of people see as scumbag capitalists over lords, who deserve nothing but the pox. It’s a business where, until recent times anyway was unique, in that it is Government policy to eliminate the small landlord.

It’s their way of increasing their housing supply for sale to drive down house prices and buy votes.

I read somewhere 95% of all landlords own one rental house. People meet, get married and move in together, leaving the spare house. These 95% have virtually no voice.

Politically they are and will continue get hammered by government policy (all colours of government) - its great for votes.

As a very happy ex landlord, I saw the onslaught and sold up and moved on. For the pitiful yields on offer, its simply not worth the effort.

Thanks again for your time helping people on here.

Grumpy

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Bill 28th January, 2021 @ 22:20

Hi David

I wonder if you could point me in the right direction.

I let a flat to a tenant in March 2017 on an AST. The tenancy reverted to a SPT after 6 months and the tenant moved out in March 2018. I refunded his deposit in full. He was happy and went on his way.

However, I did not register the deposit with any scheme, which was a complete oversight on my part.

Last week, nearly 4 years later, I received a letter from a solicitor acting for that tenant claiming compensation for failure to register the deposit. They are asking for 3x and quoting;
Superstrike v Rodrigues (2013) EWCA Civ 699

What would you advise?

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David 28th January, 2021 @ 23:16

@Bill

You must be gutted.

This is a public forum and (just in case) to avoid prejudicing yourself I suggest you use the forum to PM me for more information or questions, using the instructions in post 335 above.

I try to help you negotiate a settlement without them hiking up costs (which is their goal).

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Mary 18th February, 2021 @ 23:10

Hello,

I was wondering if you could help?

My landlord has been money grabbing from the get go, other tenants in the house have not received their full deposits back and it’s normally taken the landlord 8 weeks at a minimum to return the deposit. At no point throughout my three year tenancy has the landlord secured the deposit in a deposit protection scheme. I left the property as a result of a Flatmate moving in and their antics with their partner giving me sleepless nights ( this was anti social however I didn’t complain to the landlord directly as he would have made the living environment difficult) on top of the property being poorly insulated ( sound proofing problems and single glazed windows). Instead I served my notice and left. I have since discovered ( this evening) I missed two payments a year and a half ago when there was a problem with my direct debit.
The landlord is a cowboy landlord, all contractors who have come to complete work at the house further agree this. The tenant in the room prior to me moving in enjoyed smoking cannabis regularly so removed the smoke detector, the landlord assured me he would fix this but never did. The boiler burst and water over flowed through the first floor onto the ground floor, the landlord didn’t reply to me for five days so I paid for an emergency plumber with my own money. The landlord was informed of holes in my bedroom windows during the winter months and did not fix them throughout the 3 winters I was there. The landlord was aware of a huge hole in the conservatory roof where the rain leaked onto the electrics however once again he did not care and took no action to resolve this. I have been an exemplary tenant and he has thanked me personally for my hard work looking after the garden and taking good care of the house.
I am not interested in taking the landlord to court, however he is now demanding I pay him the missed rent . Am I within my rights to see if he will settle with me as he has failed to protect my deposit and the way I see it we are both at fault? I cannot afford to pay him my missed rent. I am really humiliated that I missed those payments however I cannot pay them at the minute.
It also doesn’t help that I am fully aware he lives in a stately home with a swimming pool and a business that has boomed in the pandemic. Another tenant has recently moved out and is awaiting their deposit ( no missed monthly payments, good record) whilst two other tenants remain in the property.
Thank you in advance.

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David 19th February, 2021 @ 17:24

@Mary

I suggest we discuss this via the forum as you have a live case.

If you had your own AST then it is not too late to hold the Landlord culpable, if you all had one AST it can be more complicated but still viable.

I would be happy to review your evidence and draft you a letter to reach a settlement with the Landlord, I am sure they will very pleased to agree to avoid paying two sets of legal fees.

See post 335 above for how to contact me via forum, I am running a bit behind as I had pretty bad Covid infection, but there are some things you could be doing meantime so message me via the forum.

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Mary 19th February, 2021 @ 21:17

@David

That sounds great, thank you very much for taking the time out of your recovery to reply . Hope you start to feel better soon!

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ghfj 25th March, 2021 @ 16:15

Hi,
I have some question to ask you, please if you might know the answer. There is a problem with my secured deposit which was protected with MyDeposit company (the company with a very bad reputation as I found out later, please have a look at them online). They kept some amount of my secured deposit but my tenancy agreement has never started. I have never moved into the property and have never lived in there. The contract was terminated before it has been started. Is it legal what the MyDeposit has done or not? Is it possible for a landlord to ask for any compensation if the contract has never started?
Thank you

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David 25th March, 2021 @ 18:10

@ghfj

I will say upfront that the reputation of these firms is based on the fact that there is always a losing party and most people leave reviews when they have a negative experience. Also that currently all 3 deposit companies enjoy between 3.8% and 4.2% on Trustpilot but maybe less on All Agents and elsewhere.

Although I did note that Trustpilot has two pages for MyDeposits one of which is no longer accepting reviews, (the reviews are clearly for MyDeposits but the site referred to is my deposit) you might want to ask them to merge them.

https://www.trustpliot.com/review/mydeposit.co.uk

https://uk.trustpilot.com/review/www.mydeposits.co.uk

What seems to have happened is that on the new page MyDeposits have started engaging and probably pay Trustpilot for their services.

So to your query

MyDeposits or any other Deposit Protection Organisation are only custodians of your deposit, they do not take deductions in their own right but against the terms of the contract ON BEHALF OF THE LANDLORD.

You have a choice to accept their determination, follow through to ADR or insist the Landlord take the matter to Court.

You have not listed timings or what you agreed to with MyDeposits or did not agree to.

In 2019 the Tenant Fees Act became Law, it applied to new contracts from June 2019 and to all other contracts a year later. It lists the circumstances where fees may be charged.

I had a client who came from another Country to the UK to study, the tenancy was prepared and a deposit taken, when the tenant arrived from the airport at 23:30 it was a Cindarella case, someone was sleeping in his bed.

There was some argument for about a week, a different room was offered but rejected, a different house was offered but rejected. In the end the Student returned home and was forced to abandon the course.

We approached the The Landlord with an offer to settle for the return of the deposit, 2x the deposit because we waited for 30 days to be up and it was not protected, we added the consequential loss for the Course, alternative accommodation while they were trying to get the person to leave.

The Landlord was by most accounts a very nasty individual, had been in the press for assaults and GBH, so of course made various threats to me. We proceeded and suggested that he speak to his solicitor and when they contacted us we suggested they hold the agent responsible. The anger then turned away from us and onto the agent. By this time because the first offer had not been accepted we made a new offer at 3x the deposit plus the above. It was settled and the agent ended up paying, adding international wire transfer fees.

Now in your situation it is the other way around, you will either have agreed to contract or you will have signed the tenancy agreement. Either way you are an adult and a Court will expect you to have read every term and cross out any that are not acceptable. There are some cases where Courts can accept a sort of duress (sign now or you will lose the property) before due diligence can be reasonably carried out.

So in your situation it is going to depend of what you signed, any terms of a holding deposit (which must have prominently brought to your attention any potential loss) which are not usually protected by a scheme or if the deposit was for the performance of the lease then the terms of the lease (AST).

If you are within time you can tell MyDeposits that you do not agree and you wish to go to Court, but make sure you are on solid legal ground because the Landlord may seek to go to Court and you may end up paying their legal costs or they yours.

I have not seen any details of the circumstances, who terminated the agreement, what the deductions were for (e.g. poor tenant referencing, providing false information (which are generally tenant faults) or whether it was the Landlord who terminated it because they wanted to live there and decided not to rent or decided to sell, (these would generally be Landlord faults).

Most of the Deposit firms side with tenants for over half their cases, MyDeposits are widely used by agents and I generally have a lot of contempt for this species.

The fact that you say they have "kept" some of the deposit suggests that you agreed to the deduction by accepting the payment.

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Lol 27th March, 2021 @ 01:43

Hey Duffus. Part 36 offers don't apply in small claims court. So your letter makes the landlord look silly.

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David 27th March, 2021 @ 09:49

@LOL

Not sure who the DUFFUS is, Deposit Protection Claims are NOT brought under Part7 Small Claims track but on Part8 track under Part56 of CPR Practice Direction.

I LANDLORD AND TENANT CLAIMS

Scope and interpretation

56.1

(1) In this Section of this Part ‘landlord and tenant claim’ means a claim under –

(a) the Landlord and Tenant Act 19271;

(b) the Leasehold Property (Repairs) Act 19382;

(c) the Landlord and Tenant Act 19543;

(d) the Landlord and Tenant Act 19854;

(e) the Landlord and Tenant Act 19875; or

>>>>>>> (f) section 214 of the Housing Act 2004. <<<<<<<

There is an exception that can move claims to Part7 but there would need to be a substantial dispute of the facts, such as the occupier being a lodger living with the Landlord.

I was always taught to engage my brain before opening my mouth, it seems that some need the same advice before commenting on blogs lol.

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Angry LL 1st June, 2021 @ 23:23

Tenant who moved out 8 MONTHS ago, owing me +£900 texted me today asking for my home address and could I also send her the AST and proof of her deposit. Im fairly new to being a landlord, knew i was being played, but didnt know how until i found this helpful page. Quick question, there wasn't an AST at all, i didnt use deposit agency, just sent her confirmation of deposit received via an email as proof i'd received it. In the last few months before she left, she didnt pay the rent and eventually left owing me just over £900. Her deposit was £250 so naturally i kept it. So if she takes me to court and gets 3 times her original deposit back, £750, she still owes me £150?!?! Am i right in thinking you only need to do the deposit agency thing if there is an AST or do you need to do it no matter what?
Thanks in advance for any help.

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David 2nd June, 2021 @ 09:46

@AngryLL

Don't be angry for your mistake because if you are going to conclude this successfully you need to first accept that you made a mistake. Of course you can be angry that they owe you money.

It does not matter whether you had a formal AST, a court can deem you had one and the law will have created a Statutory Periodic Tenancy. If you tried to create a licence or fake holiday let, the Court will void these and deem an SPT.

Basically if you took a deposit for the performance of the tenant in a property then the deposit protection legislation applies.

The only exception for this is a lodger (where you live in the same property with same front door, kitchen and bathrooms) or a genuine holiday let.

The good news is that if she still owes you money you can bring a counter claim, most of the law firms who advertise for claims like this act like insurance companies. They work on risk, they have a finite budget based on the amount owed and the likely time it will take to win the case.

They will NOT fight the counter claim as that exposes them to more lost time and they have no idea where it leads.

Also there is no guarantee that she will get 3x but even if she did, if she used a claim firm they take 35% of what they win, so if they won the £750 in Court and you issued counter claim, you would pay around £350 for filing the Counterclaim. So at the end she would only get £487.50 but have a CCJ for £1250 against her for her trouble. The Court would offset this against what she was claiming, so the claim firm would only be able to get their 35% from her directly. They would put in a claim for costs but if you follow my advice exactly I can help you reduce, mitigate or eliminate these costs before they begin.

If not claim firm is involved I can help you negotiate this down and perhaps get the tenant to come to an agreement.

I can't really do this via blog comments and it would be foolish to put information that may prejudice your legal position on this page.

If you follow the instructions below we will be able to discuss privately, I will be able to review all the facts of your case and explain how to resolve this matter.

I would suggest that you do this as soon as possible because we want to get this resolved BEFORE she contacts a claim firm. Some of these claim firms have automated processes and sign up the client with terms that mean they pay the legal fees if they pull out, which often prevents tenants from settling. Meanwhile they invent costs and whilst these can be challenged, they know they can ramp up even more costs meanwhile.

So contact me via the forum using the instruction below and I will see what I can do, I do not charge anyone for anything I do, whether it be Tenant or Landlord, the goal is settlement.

Click where is says Landlord forum at top of page or visit

https://www.landlordforumproject.co.uk

Once you register on that forum and have confirmed your email

you can click on this link to private message me:

http://bit.ly/davidpip

It will be at the bottom of left menu.

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SerM4 7th June, 2021 @ 20:33

If I've returned the deposit via TDS, cus I didn't secure it in the beginning, can my tenants still take me to court.

If I've now returned the deposit under instruction from my solicitor, can I evict these painstakingly people?

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David 7th June, 2021 @ 21:37

@SerM4

Yes you can still be sanctioned for between 1x and 3x the deposit per tenancy.

Sadly your Solicitor probably gave you bad advice, the law has changed back and forth with different case law decisions and with 4 key pieces of legislation.

There is only one tenancy period window from many years ago where returning the deposit is the appropriate route.

Worst still you have lost your leverage, the correct solution in almost all cases except where a tenant has approached you with a settlement offer that you find acceptable and which includes the return of the deposit, regardless of the state of the property.

To me a tenant that is making a claim for failure to protect a deposit or threatening to, is not a pain, they are teaching you a lesson to build this into your procedures.

To me a pain is one who does not pay any rent and may be causing damages.

I heard this Landlord on LBC radio the other day and he was in agony, his tenant was using the pandemic as an excuse to pay zero rent and told him to his face that he could jog on, he had not paid any rent since August 2020.

If he had come across this site I could have really helped him, because he had misread the Coronavirus legislation about what he can and can't do. To be clear, whilst the act of eviction was suspended, cases of serious arrears (6 months plus) or serious and well documented Antisocial Behaviour are exceptions to bringing a claim. The Courts have been working all this time processing claims and even creating possession orders, but the actual evictions were on hold. What changed recently is that the hold is off, the bailiffs may now evict those where a judgement for possession was made (giving the statutory 2 week notice bailiffs must give). Also the S21 notice is down from 6 months to 4 and will taper further in September if the Pandemic variants do not create yet another lockdown.

There are dodgy landlords and dodgy tenants but we can't tar all with the same brush, each case is as different as personalities.

So you have to see your failure to protect the deposit as a learning experience just as all mistakes we make in life are.

If you have reached a settlement with your tenant then great, if not feel free to use the instructions on post 386 to contact me privately via the forum, to see if we can find a way to clean up this mess.

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Mary 29th June, 2021 @ 13:17

Hello, I have a problem with an ex tenant. He moved out 6 months ago and he has now sent me a letter before action for not protecting his deposit. I am shocked. We had a good relationship for 3 years, then he wanted to terminate his contract early because he lost his job during COVID.

He moved out before the new person moved in and to be fair, he was paying the rent and bills until the new person moved in.

However, there were issues, he smoked in the flat, also cannabis not just cigarettes, he only superficially cleaned, and of course I have had to spend a considerable amount of money restoring the property to the condition it was let to me.

However, I have now received a letter that he will claim compensation for not protecting his deposit on four tenancies, he claims he can get 3x-9x the deposit. Is that true?

I really don't know what to do, but I think it's grossly unfair how he is behaving, taking into account that I allowed him to terminate his contract early.

Is there anything I can do?

Can I threaten him with counterclaim for damages at the flat?

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