My Tenant Is Threatening Legal Action For Not Securing The Deposit

@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.

@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.

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?

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.

@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.

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.

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!

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?)

# 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!

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

@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.

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.

@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.

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...

@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.

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

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?

@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).

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.

@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.

@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!

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

@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.

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

@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.

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.

@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.

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?

@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.

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?

Help please! I’ve got myself into a pickle…

I manage the rental property of my ex-partner. The flat belongs to her (she owned it from before we were together) – but I manage the day-to-day stuff to do with tenants, so she has more time to care for our daughter who has extreme mental health needs. (I’m not paid for this – it’s just an ad hoc arrangement with my daughter’s mother.)

So technically, I’m not the landlord, but for the purposes of the below (and indeed the claim against me, I am)… A former tenant has made a claim against me for not protecting his deposit and the claims company (no-win, no-fee, obviously) seems to forever moving the goalposts when I try to negotiate a settlement (to maximise their costs, I suspect!)

The tenant moved in Feb 2019 – I did not protect his deposit, as I should have. I accept this was a mistake and I messed up.
There were extenuating circumstances – my bother-in-law had recently been diagnosed with terminal cancer (he was diagnosed in Dec 2018 and had died by Aug 2019). Additionally, my daughter has severe mental issues needs due to special education needs – and my brother-in-law’s illness seemed to be a major trigger. (She’s missed a huge amount of school – probably 50-75% – since my brother-in-law became ill, so I was also contending with a child who was unable to be in school and all the worry and stress that comes with that.)

This is not to excuse failing to protect the deposit, but to show how I was under severe stress. When I missed the 30-day deadline, I wasn’t aware that I could still protect it (albeit I would have then been liable for a penalty anyway.)

When the tenant moved out, there were several areas of damage and poor cleaning that I needed to make deductions for.
The tenant wasn’t happy and as soon as he realised the deposit wasn’t protected said he was going to seek redress.

His claims company contacted me in Summer 2020 and said they would settle for 3X the deposit (approx £9k). At this stage I was unaware of the law and the fact I would definitely be liable for a penalty, so I wrote back and rejected their settlement.

We then conversed for several months and their offer to settle eventually came down to 1X the deposit. At this stage I was still unaware that I would definitely be liable for a penalty – but did attempt to negotiate with them for a settlement of less than 1X.

I then didn’t hear from the claims company for quite a while – so eventually I chased up my most-recent offer. They replied that the offer was not acceptable and they had lodged a claim with the county court.

At this point, I discovered this excellent website and read the (very useful!) info here and realised that 1X the deposit was the best I could hope for.

When I received the court papers I admittedly liability and asked for the settlement to be made at 1X the deposit.

Around the same time I also received a new offer of settlement from the claims company. This stated my previous offer of less than 1X was not acceptable, since they had now incurred “significant costs” – and offered to settle at approx £5,600 (approx £2,600 more than their previous 1X offer).

This seemed excessive to me, but I did think we were going to be able to negotiate and avoid the need for court. I replied and offered to meet them in the middle point – approx £4,300.

I also asked to make an agreement for payment terms for £1,300, as I have a small savings pot and could pay £3,000 straight away – but beyond this I have no savings or assets. (I should also add that I have been on Universal Credit since the start of the pandemic and my financial position is very strained!)

They did not reply to my offer to settle for £4,300.
Instead in late October, I received a letter from them saying their clients would accept the settlement I had listed in the court papers (1X deposit) – PLUS their costs, which were to be determined.

I replied to ask what these costs would be, since how can I agree to a settlement that doesn’t list the sum?
They replied and said exact costs would need to be calculated by their costs department but that they estimated them to be approx £9,800!

So in August they were asking for 1x deposit and around £2,600 for a total settlement of approx £5,600. And, now having ignored my offer in August of £4,300, they are asking for 1X deposit AND nearly £10,000 in costs.
(Additionally they state, “We must stress that our legal costs will continue to accrue in this matter as we prepare for the hearing on 29th November 2021.”)

I accept that I messed up by not protecting the tenants deposit – as I’ve explained there really were extreme extenuating circumstances. And I accept that I’ll have to pay a penalty for this.

I also messed up by not settling earlier, when I had the opportunity! Initially, it just seemed a question of negotiating with the claims company. But at the point I begun to seriously attempt to settle, they then started to move their offers in the opposite direction from mine.
Each time I’ve recently submitted an offer, they reply with a higher offer – I then try to go some way to meeting that offer and a new offer comes back at an even higher cost!

Essentially, I’m screwed. I have £5,000 in savings – and beyond that no assets and no significant income. I get by on Universal Credit each month – just about. And that looks to be changing to just about not get by, with the removal of the UC uplift, increasing energy bills and some recent new costs relating to my daughter’s needs and care.

Oh, and just to add to this mess, my ex doesn’t know anything about it. She’s also very stressed and under pressure because of our daughter’s needs, plus the effect the pandemic has had on her business. And she would certainly loose the plot with me if she knew…

Help please! What is the best course of action?
Should I settle with the claims company, even at around £13k+?!
Or do I go to court and hope the judge takes pity on me, in relation to their (excessive, as far as I’m concerned) costs…?

PS> Sorry this is so long!

@samski

Whether you are Landlord or Agent does not really matter, if your Ex was being sued you could be added to the claim so the Judge decides, I am guessing it is your name on the paperwork and ou seem to be taking responsibility.

With the greatest respect and sympathy the Court will not consider these truly difficult things mitigation, otherwise everyone would quote them.

What they WILL consider is the level of culpability, so if you protected on day 45 they would only sanction you by 1x the deposit, if you failed for the whole of the tenancy or even several tenancies including a Statutory Periodic Tenancy then you can expect higher sanctions.

Would you seriously expect a Court to believe that you thought the opportunity to protect stopped at 30 days?

A Judge is interested in what was intended when the legislation and the updates to the legislation were created, they will give you credit if you afford the Tenant the right to the ADR each deposit protection scheme provides free of charge to both parties.

The legislation was designed to stop Landlords helping themselves to the Tenant’s money, especially if they did no inventory with the tenant before and after. Had the deposit been protected then you could have made a claim to the scheme, the scheme would give the Tenant a chance to have their say and the scheme would have made a determination without clogging up the Court.

Another thing I mention for the sake of other Landlords is that just because you have a term in your contract does not mean you get to go against common law. You can get away with requiring the property is returned in the same state it was let, but accounting for fair wear and tear. Any deductions need photo evidence and inventory checklists for before and after to be valid.

As with any claim you wish enforce you need to give the Tenant a chance to mitigate their loss, so you would inspect the property, say “that carpet is not in the same condition please have it professionally cleaned, alternatively I will get three quotes and used the best quote, then deduct it from your deposit via the DPS”.

Again for the sake of other Landlords, do NOT wait until the 11th hour, as soon as a tenant sends an email about it get in touch with me, stall them, do not let it get to a claim company.

All the claim companies open at 3x the deposit per tenancy, but if the circumstances are right we can negotiate that, but remember their game is to get you to write long emails so they can charge you for reading them. For 9 out of 10 cases I can get a reasonable settlement, but the earlier the better because they can reasonably claim their costs and to challenge costs is expensive (I still do it when I see excesses).

You can certainly get a tenant who has not gone to Court to settle for £300 to £500 BEFORE they engage a claim firm, but understand the MINIMUM is 1x and the claimant loses 35% of the sanction to pay for condition fee engagement (no win no fee). No Solicitor is going to accept less than the Statutory minimum.

I am sure they were happy to converse for several months, just remember, the legal system is a “pay to play” environment, it is your dime. If they did not respond to your offer within 2 weeks assume they are going to Court and costs will go to a new level. After all they have to get the claimant to sign a witness statement, product the exhibits for the bundle, show that you have not used any of the schemes. On top of this there is the County Court fee which is over £300. If you still do not settle they have to prepare for Court.

Those costs seem excessive but I do not know how much back and forth there has been, I can certainly help you ask for a full assessment of the costs, which will show what was done and what the grade of the person doing the work was.

The problem I have is that you contact me now, a week away from the hearing when it is extremely unlikely the Court will allow you to file any more evidence.

The costs do sound excessive, especially for the jump from £5600 to £9800, but I have not seen the file.

Please understand that I am not being harsh with you, I am trying to help others learn from your mistakes.

Cost can be challenged if unreasonable and you can ask for time to pay, the property itself is an asset and if the claimant thinks you are broke they will add your ex to the claim.

If this is your Ex why on earth are you managing the rental in the first place, let them get an Agent?

You better ‘fess up to your Ex because if she finds out from someone else it will be worse.

Normally I would tell people to go run and jump if they contact me this late, I am prepared to try to help you get those costs down but you will need to act with a sense of urgency and follow exactly my instructions offline, any failure to do this will see me walk away because I am juggling a plethora of cases and I have no time for people who do not respect my time, especially when it is given freely.

At this late stage I will read the evidence and try help you settle without going to Court, I may know the firm and be able to give you an idea of who we are dealing with, but I need you to act QUICKLY.

You will need to follow the instructions in post 386 above and contact me via the forum, do not post more here.

My landlord took years to protect my deposit, when does the statute of limitations apply, is it from the time they should have protected it or from the time they actually protected it, is there any case law that can help. The tenancy started over 6 years ago, the deposit was eventually protected 5 years ago.

@John

I am not aware of any case law, but I have taken such cases and been able to persuade the Judge because of the following.

1. The moment of discovery by the claimant of the error should start the clock.
2. In any event the Limitations Act allows 12 years for concealment or mistake.
3. As protecting the deposit would trigger letters, SMS or emails from the deposit protection company, the act of NOT protecting the deposit is an act of concealment.
4. Not serving the PI is an act of concealment because had it been done the Tenant would had been informed of their rights to bring a claim because many tenants know nothing about deposit protection and so the PI gets them searching online and finding out.
5. In the event that the failure to protect the deposit was an error on the part of the Landlord then is was clearly a mistake and 12 years can be triggered for mistakes.

I think the reason that there is no case law is that nobody would be daft enough to appeal a claim on the grounds of limitation.

What really matters is evidence of the tenancy, ideally the agreement, but evidence of occupancy like bills and bank statements, land registry details confirming the Landlord and bank records showing the payments will usually be enough. It is always best to gather all your evidence and then approach the Landlord with a pre-action letter that seeks to settle the matter.

Considering that legal costs have spiralled lately due to shortages of staff most Landlords would settle before the claim is filed and they are then subject to costs which I have known exceed ten thousand pounds in some cases.

Thanks David, do you have sample letter I can use by any chance please, as I will write to the landlord. I have seen adverts for solicitors who can persue the claim on my behalf but so far have not been tempted to use their services, but that said the methods they use plus the fact they are solicitors may increase the return. Some might say what I am doing is harsh but without going into too much detail the shoe is finally on the other foot.

@John

You will need to follow the instructions in post 386 above and contact me via the forum.

Hi i am trying to make a settlement for non protection of a tenants deposit which i have agreed to return the full deposit and pay compensation, i cant find a example Settlement Agreement anywhere that will prevent the tenant from looking to re-claim against me in the future. i noticed there was going to be an example document uploaded and wondered if it was on here somewhere yet?
thanks for the great advice

@Sam

Unfortunately it proved to be impossible because no matter how hard we tried it had to be customised for the circumstances of the parties, otherwise it opened up liabilities.

Hi David,

I hope you're well? I was advised to message you my issue direct as I contacted 'The Landlord' initially. Firstly may I apologise for contacting you with a problem - it feels rather rude. In short, I have an old tenant using the no win no fee system because I didn’t protect her deposit. I gave it back to her, in full on the day she left and she was only there for 2 months.

I know this is irrelevant because I didn’t do what I was supposed to but I used your blog as a point of reference and followed your brilliant advice. I have been trying to negotiate with her and I’ve now offered 1.5 times the amount but she has rejected my third and final offer.

I’m now at a loss because I don’t have a clue what I am doing? If it was just her personal demand then I’d try my best to settle but she (the company) want double her demand in fees and I flat out don’t have it. I’ve just received another letter saying they are taking me to court.

I don’t know what my rights are (if any) and I don’t know how to find them out either or what I should expect to happen next? I’m really worrying about it. I’m not a pro landlord with a huge portfolio. I have a normal full time job and the fear of the unknown is keeping me awake at night.

Finances are a genuine issue so I can’t afford a solicitor and just can’t seem to find the information that I’m looking for?? Am I legally required to pay such unreasonable fees? You mentioned how cases can get super expensive but again I don’t understand why/how?

They told me I wasn't allowed to contact her directly and negotiate and it all had to go through them. I feel like I’m being totally exploited and my ignorance is only further fuelling my vulnerability in this situation.

I’m sure you probably get this stuff all the time but this is the first time anything like this has ever happened to me and I'm desperate for some advice and you seem like a guy in the know?

If you can help me I'd be eternally grateful.

Thanking you in advance

@Mary

I had a case like this where the let was cancelled and was able to get it kicked out because of other errors by an Agent, but best not to discuss on open forum.

As you have a live case I suggest you contact me privately via the form, you will need to follow the instructions in post 386 above and contact me via the forum, do not post more here as it may prejudice your case.

You need to act quickly as if she has instructed a claim firm there will be a time limit they imposed.

Can I ask for some advice please? We’re vacating our rental property after giving our LL one months notice. We were served an invalid S21, due to no gas safety certificate given to us when we moved in and for no prescribed information, which would expiry after our move out date. If the LL tries to take our deposit from us, which we strongly expect, once we inform them that they’re in breach due to lack of PI, would the court order them to refund us our deposit as well as 1 to 3 times our deposit for each tenancy breach (4 breaches in total)?

We just want to move out without them putting us under additional stress for making false allegations about the state of the house. They’ve been very hostile towards us for some time and we have no reason as to why they’ve been like this towards us. We have always paid our rent and kept the house clean. They gave us a S21 within hours of us informing them of the boiler not working.

Thanks

@Cate

A S21 needs to be legally correct at the time of service, this means they will have need to correct any defects BEFORE it was served.

This is the perfect time for all parties to negotiate a settlement without involving a Solicitor, Claim firm or Court.

There seems to be some confusion and debate on the term "breach", the law provides an opportunity to claim between 1x and 3x the deposit per Tenancy as long as the defect has not been corrected. If your original Tenancy expired and you did not leave then it usually creates a Statutory Periodic Tenancy, so that makes two.

A Court will also order the return of the deposit in full unless there is excellent evidence of damages, so it is critical to take video and close photos before and after you go in. If a Landlord does not provide an inspection with you present both before and after the Tenancy they will struggle to make any deductions for damages.

From what you have said it appears they have served you a defective notice, so you could wait the 2 months and tell them on day 60 that you will not be leaving as the notice service was defective and not legally valid. This assumes they did not correct the defect, some defects cannot be corrected if they are within the catchment of certain case law. I don't advise giving me more detail here.

As you have a live case I suggest you contact me privately via the form, you will need to follow the instructions in post 386 above and contact me via the forum, do not post more here as it may prejudice your case.

I can then review the evidence and help you write a letter to resolve the matter amicably and legally.

Don't worry about them being hostile, once they get a letter seeking to resolve the matter 95% of Landlords suddenly become pussycats because they will realise it is better to settle than pay egregious legal fees (which in my experience have exceed £10k when Landlords argue a lot).

I suggest you do NOT leave without giving the notice prescribed in the Tenancy or by legislation if it has become SPT, however, this can be negotiated in the round with their payment to settle the deposit claim out of Court.

Hi David,

I have a tenant renting one bedroom in a 2 bedroom house under an sta for a contract period of 6 months. They are still in my property and I received a letter claiming 3 x the deposit because I did not register the deposit within the 30 period. I registered it circa 32 days late (just over 2 months into the tenancy). They are very heavy handedly threatening legal action. I am a considerate landlord (as I've rented in the past and know how bad it can be for renters). It is my sole rental property. I have caused them no concerns or issues and have done my best to provide a comfortable space for them.
What would your thoughts be as regards compensation? Should I be following the advice in your article, or would this situation be be considered as complete overkill for a payout?

Thanks.

Please can you advice with a tenant trying to claim 6 x deposit back. 1 x deposit but was on ast and then automatically to periodic
Deposit was given back left on good terms reference given.
My fault for ignorance have offered multiple offera for settlement inc 3 x deposit
Court ha set it as small track which they objected wanting it as part 8
Is there any cases that overide the superstrike case that they are trying to go down and want 6 x back

@Jackie

The legislation provides that a sanction of between 1x and 3x the Deposit may be awarded by a Judge, this is per Tenancy, legislation was brought in 2015 to curtail Superstrike but it did completely remove the "per tenancy" aspect. Instead it says that sanctions are payable for as long as the law is broken.

If you remedy your failure by protecting the deposit late but within the first Tenancy AND the law continues to be complied with (the deposit remains in a scheme - insurance backed schemes to not expire and so on) then the law is complied with for the subsequent tenancies.

Whilst the legislation is pretty binary (you either did or did not protect the deposit) there is case law that confirms the right of the Judge to decide a sanction of between 1x and 3x the deposit. There is nothing to say it has to be a multiple, many claims are settled at 1.5x and some simply ask the Judge to award say £2k on a deposit of £1500 because it is still a substantial penalty.

Recent case decision have shown that Judges are being very creative about the level of Sanctions, some award higher awards the longer the failure continues, while others actually start with 3, then 2 then 1.

They will have moved it to Part8 because they can't get costs on Part7, the case is usually brought under Part 56 and on the Part8 track.

The claim companies should be asking in the first instance for what the likely award would be in Court, but most of them ask for the max, some even exaggerate the claim. Then as they rack up costs for arguing with you they reduce the level of sanctions they are seeking.

Personally, I think that this is unreasonable conduct, no reasonable person would accept sanctions that are much too high, it is fine to ask for an award per Tenancy but the Case law says that the Judge can decide on the gravity of the failure and make the appropriate sanction. The so called specialists in this area of law are or should be aware of this and recent awards. Therefore one might ask the Judge to not allow the costs because they made no genuine effort to mitigate the loss and their conduct was unreasonable from the outset.

There is an argument that the Tenant should write to the Landlord in accordance with pre action protocol and practice direction, BEFORE they instruct a Claim company. A sample is freely available on Shelter and other consumer websites.

The problem any Landlord faces is that by the time a claim company has been instructed the Tenant is contracted on a conditional fee basis, if they pull out the claim firm will ask them for their costs. Couple that with Claim firms that start writing with demands for 6x the deposit, a reasonable person looking up the legislation would assume the range is 1x to 3x and not understand that the Statutory Periodic Tenancy also gives rise to sanctions, IF the deposit was not protected and the Prescribed Information served.

The worst thing a Landlord could do is argue or to make legal points, just one simple letter, otherwise costs could be higher than the sanctions themselves. I have seen these go as high as £10,000 in costs before any appeal.

The objective for both Landlord and Tenant should ALWAYS be to settle the matter without involving Solicitors and without troubling the Court.

They won the keeping it at part 8 claim and was awarded costs The judge urged them to try negotiate with me as i have attempted and said they wouldnt be happy if they didn't in relation to costs. They have have made a part 36 offer of the amount i offered and made a calderbank offer of £7500 i know the part 36 then causes issues if i reject this and because i have already offered this amount being 2x deposit it is likely this is what will be awarded in court but 6k in solicitor fees is this realistic/ can you negotiate these? Is it bad idea ? Am i just best writing it off as bad experience .. the depoait was juat 550 and they had their deposit returned

@Jackie

And there you have it, another case of an offer made after costs have been run up, but had they made such an offer in the first place (without the onerous costs) then you might have accepted it.

I would need to look at the paperwork to determine your chances, you can ask the Court to order an assessment of costs but I doubt you will get more than a 20% reduction. In my experience one potential route is to seek to show the Judge that the conduct of the Solicitors and the Claimant was unreasonable.

The first thing you need to determine is the gravity of your failure. We have a plethora of cases which are worst case scenarios where the Landlord has been guilty of other conduct so they get a 3x award for each Tenancy.

However, at the other end of the scale there are novice Landlords with no other property, perhaps their first time letting and maybe they relied on an Agent.

As experts in their field you could argue that they should not as a matter of course start out at 3x the deposit (which is very common), but that they should have considered the gravity of the case and asked for what it was likely they would achieve in Court.

The idea that they lower the claim now after running up £6000 of alleged costs bears scrutiny, the problem is that the meter is running. So going back to the claim firm is going to increase costs further.

I would advise you report the firm to the SRA but this can only be done after the claim is determined.

If you continue in Court then there will obviously be more costs, if I was involved from the outset before the claim firm was involved then things may be different, but if you are going to Court you need to have the resolve to fight all the way. If you show any sign of weakness you strengthen their resolve, you can't win so you pay the other sides costs, but if you want to argue that the costs were created by bad conduct and unreasonable behaviour then you might ask that costs are not awarded or set to those up to the point of a certain date.

i.e. If you made a 2x offer ages ago and they refused it then you might ask for all costs after that to be removed, you can also argue that the cost of the initial claim and the Part36 offer itself are all templates and so did not even need a graded employee.

You might find the person who has been dealing with your claim does not have the hourly rate they are claiming.

Sadly Part36 offers do mean you have to pay the costs if you agree to the offer, £6k sounds high, it is all about your risk appetite.

It is grossly unfair but it comes down to whether you can stomach the fight, many can't and when they see the other side prepared to go into battle they cave. I find it depends on the firm, I can probably guess the firm involved from what you have said.

The minimum award is £550 x 2, but the costs are another matter. So you have to consider whether it is worth it.

I have had decent firms settle costs for as little as £350 plus Court fee even when they have filed the claim in the County Court, but not all firms are decent. Other firms expected a complex argument and so brought in a Barrister, but I think that is overkill.

The issue here is likely to be about their conduct and inflated costs. On one case where we sought the costs be assessed they tried to add another £2k for the costs assessment, the Judge kicked that out but not all would.

If you do decide you want to fight it then a simple letter disputing the costs, giving reasons why, with a counter offer, will show the Court you were willing to settle.

Review the CPR for costs and PM me if you think you have grounds to dispute the costs.

https://www.justice.gov.uk/courts/procedure-rules/civil/rules/part-44-general-rules-about-costs

As you have a live case I suggest you contact me privately, you will need to follow the instructions in post 386 above and contact me via the forum, do not post more here as it may prejudice your case.

Hey everyone,

Seems like i've fallen foul of this and have a tenant who is definitely out to get me, despite them being particularly testy (The garden is completely overgrown, there's been rubbish all over the place which I have ended up getting rid of, they haven't paid some utility bills etc).

At the outset they wanted a 12 month term, whereas we wanted someone to come in for longer. In the end the agreement was an 18 month term with a 12 month break clause, where if they left before 18 months the deposit would be witheld. They signed on that basis.

Subsequently, 2 days before the end of 12 months of being there, I had the gas safety cert done and i did a general check up. Generally it was ok, but they'd leaked water from the bathtub which had gone in to the ceiling of the room below, aforementioned garden issues. They tell me they have bought a house, but need to get it refurbished, so will be here until the end of the 18 months. They admitted the garden was a problem, they don' t have green fingers so can I get them a quote for clearing it. I get that for them and it's circa £350.

6 days after that, i get a whatsapp message telling me that they've decide to move abroad and want to leave.

I ask them to kindly send that to me via email (you can't break up by text) and that they need to give me one months notice. All hell breaks loose with them stating they don't have to give notice and they can leave and have i secured the deposit.

Cue alarm bells and the 'oh shit I didn't do that'. I've had other back and forth but didn't respond on the deposit whilst i worked out what i could now do.

I've protected the deposit now, but she's already said in a text that if i haven't protected it she can go after 3x the deposit.

I feel stupid whilst also feeling like they're screwing me over, as they're going against the original agreement as well as then trying to fleece me for the money.

Flipping horrible.... guessing the advice, per the blog, stays the same. But if anyone has any other ideas, please do share.

Thanks in advance.

Mo

@Moa

She can ASK for 3x but it depends on the circumstances and culpability of the Landlord, it is best not to discuss that on an open blog.

Any alleged failure to protect the deposit does not diminish the fact that the deposit is held for the performance of the contract, particularly damages.

I think you would struggle to take her deposit because she is exercising a break clause, it would depend on how it is worded but I would not rely on that alone.

The Tenancy probably has terms that explain how service of any documents to the Landlord must be provided as well as the surrender of the property.

There will also be issues around a more detail inspection required at the end of a Tenancy, my concern would be the water damage and how bad it is.

Many things only become visible when the Tenant has removed all their furnishings.

I can help you carefully construct a without prejudice letter with a settlement offer which is the way I would advise handling this.

As you have a live case I suggest you contact me privately, you will need to follow the instructions in post 386 above and contact me via the forum, do not post more here as it may prejudice your case.

Hi

Thank you for providing the sample letters. Currently receiving threats of extortion from tenants who left 8 months ago and had deposit refunded in FULL. Basically because they stood in the property threatening me if I didn't. And now they don't want to pay a utility bill which is based on a meter reading.

Anyway, moan over, and thanks again. Let's see if the letter solves the issue.

Thanks
Too Soft Landlord

Hello David. I have sent you an enquiry with a predicament similar to the ones above. I am struggling to find a capable solicitor that can answer all my questions on this matter, as after a lot of research and the case now dragging for 6 months, it feels that I have been able to learn a lot about these cases and the little advice I'm getting is quite generic.

Would be much appreciated if you could have a read of my enquiry and get back to me please. Thanks