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

375 Join the Conversation...

Showing 325 - 375 comments (out of 375)
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David 16th November, 2019 @ 10:39

@Amy

That is the scam, a mistake is to get into protracted negotiations because the moment you do you run on their clock. Each case is different but we may be able to bring a counter claim if there is adequate evidence of your costs. This scares away the more professional claims companies as they are effectively insurance companies and work on a risk basis, plus they will not fund the counterclaim and it is unlikely the tenant will pay their £2k fee to do so (although most are not even setup to do so).

If you have sent one email then the costs are too much and can be challenged, it can also be against some CPR, I will need to see paperwork.

As your claim is live it is best we discuss privately via the forum, please follow the instructions in post 304 above to send me a PM via the forum.

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JH 1st Time Landlord 12th December, 2019 @ 09:50

David,

Thank you for your advice. Following the counteroffer you suggested I I have now reached a verbal agreement but desperate to find some words for the Settlement Agreement to make this full and final settlement for all outstanding matters and include a gagging clause to prevent them unsettling my current tenants or others

Did you get round to penning something as you described above?

Or did you locate a pro forma elsewhere which you could send a link for?

Many thanks,

JH

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David 12th December, 2019 @ 12:06

@JH

Unfortunately it was not possible to provide a template because of the potential loopholes because of housing law having so many variables, as well as the position of tenants. I can do one for you based on your explicit case if you contact me via the forum.

Please follow the instructions in post 304 above to send me a PM via the forum.

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Nick 19th December, 2019 @ 01:24

Hello, what a great forum! Advice needed please.
Tenants are 4mths in arrears due to endless stalling, fob offs and empty promises. They make a token payment here and there along with promises that they want to settle their arrears but never stick to payment plans and the debt is just getting bigger! They are in a periodic tenancy nowbtw.
Along with rent arrears, they refuse to see me to discuss the issue , ignore me when I have been to the property even though I can hear they are home.
They refuse to let me inspect the property, have been a nuisance to their neighbours and I believe they have damaged the property because they fight.I also have a suspicion that they might also have a pet which isn't allowed.
I was late paying their deposit by one day and didnt know about the prescribed information legislation. I just want them gone now so my question is do I stand a better chance of eviction with section 8 or section 21, I have mandatory grounds of rent arrears and several discretionary grounds. Having spoken to lots of eviction companies and solicitors I am receivinbg conflicting information about the best way forward.
Any advice would be greatly appreciated TIA.

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David 19th December, 2019 @ 01:57

If you go S21 without the PI, How to Rent, Gas Safety and EPR having been served then it will be invalid and you will just waste 2 months.

In your position I would go S8, the only way they can avoid it is to bring the arrears under 2 months which is still something.

Now it is just a case of accepting it is going to cost you money.

If they have kids they will go to Council for housing and they will be advised about the deposit, although the Council will likely just search that it is protected, it is only if you log into the portal that you see the date of protection. Remember if the PI is the only thing missing it is your word against theirs and very hard to prove a negative.

If the deposit becomes an issue I can probably help you get it down to 1x or cancelled completely.

S8 does not require Deposit Protection etc but some Judges play dumb on that, so be ready to remind them if it comes up.

Also if they want to bring a counter claim then they must pay the Court Fee, you can verify that before you go in and if they have not served you the Counterclaim evidence and paperwork in accordance with CPR, again, you can ask for it to be not heard.

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Nick 20th December, 2019 @ 12:04

Thank you so much for your reply! Should I rerturn their deposit to them as a matter of course ? One eviction specialist company said that it could still be used to off set some of the arrears even though it was protected late.
Thank you

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David 20th December, 2019 @ 12:34

Nick

The deposit is held for the performance of the contract, that does not change because there is an issue with protection.

At the end of the tenancy the DPS, MyDeposits or TDS will allow each side to make claim on the deposit and provide you with means to require deductions.

Rent arrears are 100% deductible and they would have to show proof they have none.

The amount therein is not used as a calculation in determining the arrears when you go to Court, in fact when you do your section 8 as well as asking for the termination of the tenancy you ask for permission to take the deposit, charge interest till debt settled (according to rates in tenancy) and so on.

This is a bit like dealing with an overflowing bath, first thing to do is turn off the tap. It may be worth your while assuming the tenant is on housing benefit or element thereof in universal credit. So start with the Council, provide a copy of the tenancy agreement, explain that they are more than 6 weeks in arrears and ask that they make housing benefit payments to you with immediate effect. They pay 4 weeks in arrears but you will get the money eventually so it cuts the losses.

If they are not on HB you will get a letter back saying so and you can try the same thing on Job Centre Plus for universal credit, but check your area to see whether UC has been rolled out, it is an absolute dogs dinner of a system with 4 IT systems no one contains all claimants.

What you can expect is that they will either Counterclaim if they are acting for themselves (I discourage this when advising tenants, they have up to 6 years to claim and they are likely to get a lower sanction), claim companies will also be wary of counterclaim because they run cookie cutter law and do not want to get dragged into defending damages claims).

So after all over you can expect a pre-action letter in accordance with CPR conduct or if you are lucky an email at which point a settlement can be agreed.

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James P 17th February, 2020 @ 12:25

David.

What a great thing finding you, I'm greatly encouraged you may be able to help me please. Hopefully this will help others too.

I've had a letter from Solicitors , with a Part 36 offer, I'll relate the circumstances.

I let out to tenants on STA in 2019 including a deposit with them knowing it was just for a short time as I was going to be demolishing most of their accommodation then selling, which I've since done. They came from the Crisis team locally so I wanted to help them in their difficult circumstances.

I was a dutiful landlord in difficult circumstances.

I didn't register their deposit as I knew it was very short term, silly me, I know now.

They in late 2019 and I returned their full deposit, I even part paid them in cash (with them signing for it as proof before they left) to help them out of the financial hole they were in, then the balance by BACS.

Out of the blue, some 4 months later I get letter from Claim Solicitors demanding compensation of 3 times the deposit twice as the STA ended after 6 months, so it amounted to 2 transgressions, and also the cash part payment which they claim I didn't pay, which I have proof I did as well as texts as proof, amounting to a ridiculous amount, though it can get resolved with a 'generous' Part 36 offer of an equally ridiculous amount plus solicitors costs.

Naturally I'm really concerned, I haven't got any money to pay them whilst the house lies empty and up for sale.

I was shocked after reading the site and blogs how widespread this is, I know I'm in the wrong though that's hard to accept after doing the right things and being a good landlord, some small consolation, and hopeful that I can get help to resolve this matter to a reasonable financial amount.
Thanks in advance for any help David.

P.S. I've got to reply to Solicitors by Friday 21 February. Thanks.

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James P 17th February, 2020 @ 12:29

To add David, they didn't leave the property perfect, not awful, I've got pictures, though I didn't withhold any money as I wanted them to go forward on the best foot to their new home.
James.

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David 17th February, 2020 @ 16:11

James P

As you have a live and very pressing case please see instructions on post 304 to contact me via the forum.

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David 19th February, 2020 @ 09:30

@James P

You said you need to reply by Friday but you have taken 2 days to do a 5 minute task.

Do not expect me to be able to resolve this in time if you do not give this matter the urgency it deserves. The instructions are clear enough

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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James P 19th February, 2020 @ 09:34

David

My apologies again, I pm you earlier.

Thank you for your help.

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Natalina 19th February, 2020 @ 19:00

Hi David

I’ve stupidly not put the deposit in to a scheme and it’s over 30 days. I only looked in to everything after my tenants have started to stop paying the rent and I begun looking in to a section 21 notice. I know now that’s no defence so I have now registered with the scheme which I can see was also too little too late. Can I just give them back the deposit or take off what they owe me and give it back to them and all will be ok? Or does it not work like that? IM terrified that I’m going to be liable for this x3 deposit as I know they’ve been advised by the council to just stay in the house and not pay anything now.

Thanks in advance

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David 20th February, 2020 @ 12:28

@Natalina

Your failure to protect the deposit and serve PI withing 30 days only means you are potentially subject to a sanction between 1x and 3x the deposit.

It does NOT mean your tenancy was not valid nor affect the Tenant's liability for performance of the contract, the Deposit Company will give it all to you if you can show damages of non payment of rent.

In your position I would seek some sort of negotiation, it is always better to get a settlement with a tenant before they contact a claims company because these companies are mostly about ramping up costs, so they must be approached in a certain way to limit costs.

Ages ago you could pay it back but Landlords were really abusing that so the law was changed.

To mitigate the amount of the sanction you need to be seen to protect the deposit in one of the three schemes as the earliest opportunity after realising it was not protected. The worst sanctions come when it is done just prior to issue of S21.

So you have protected it which is good, but if they are not professional bad tenants you may reach out to them and say you want to see if there is a way to help them with a plan for the arrears so that eviction is avoided.

If you reach a settlement agreement to pay them say 1x to 1.5x the deposit (I can give you help with a letter and settlement agreement) but you have them pay you it straight back (get them to sign a receipt and you sign one too) so against the arrears.

Once that is signed and agreed so bullet proof you move to limit further losses.

If these tenants are on Housing Benefit you can have it paid directly to you at 6 weeks of arrears. This tends to make the "professional bad tenant" want to go, otherwise they are spending housing benefit on their mobile phone or Sky TV contract, cocaine habit or whatever!

You also need to establish two things from your Council; would they be deemed to have a responsibility for housing these tenants (children, vulnerable etc) and what is their general advice to tenants, do they take the obligation to house from the expiry date of the S21 or do they force tenants to wait for bailiffs and thus push the tenant a further £3k into debt. Government guidance is not to do the latter but quite a few still do.

You still have Section 8 which is not only the more appropriate eviction route for arrears over 2 months but does not depend on the prerequisites of S21.

As you case is live I would avoid providing any detail information here as that may prejudice you if they or their legal representatives read it.

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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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 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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