I Haven’t Protected My Tenant’s Deposit, What Should I Do?

For a general overview and background on tenancy deposits, please refer to the tenancy deposit guide. For those of you that are familiar with the legislation but have failed to protect your tenant(s) deposit for one reason or another, you’re in the right place.

Brief reminder of what is required to comply with the Tenancy Deposit Legislation

To be in compliance with the Section 213 Housing Act 2004, any money taken from a tenant as a security deposit must be protected in a Government approved scheme with in 30 days of receiving it. Just to clarify, it is NOT a legal requirement to take a deposit, so this legislation only applies to those landlords that do (which, quite frankly, is most).

After the deposit is protected, the tenant must be given the Prescribed Information related to the protection of the deposit, also with in 30 days. NB. Make sure you have evidence that you have done it.

It’s also worth noting that ALL deposits ever taken must now be protected– even those taken before 2007 when the original deposit legislation was introduced (that was previously NOT the case). Landlords had until the 23rd June 2015 to protect deposits!

Once the deposit is protected and the proscribed information is served with in the allocated time, you have complied with the law until the tenancy ends – even if you allow it to roll on (known as Statutory Periodic Tenancy) after the fixed term has ended.

I didn’t protect my tenant’s deposit!

Mr Forgetful
If you are one of the many landlords or Letting Agents (yep, they screw up too, but that’s probably no surprise) who have not protected your tenants deposit you’ve got a problem. Well you know that otherwise you wouldn’t be reading this. Hello, welcome.

There have been so many changes to Deposit Protection Legislation, since it was foist upon us in the Housing Act 2004, it’s not surprising that so many landlords get it wrong– but unfortunately ignorance is no defence in law.

I am going to do this backwards because it is when a problem shows its ugly face that most landlords realise that they have screwed up, so let’s look at some of the most common scenarios (sadly, none of which will save you), and from my experience, when most landlords frantically start becoming concerned about their non-compliance…

1) My tenants are threatening me
Your tenant(s) has discovered they can prosecute you and potentially make a quick buck by seeking compensation for your failure to comply with the law. Either you pay compensation or face legal action.

This is unbelievably common, which is pretty sad. More about what to do in this scenario below.

2) I need to get rid of my tenant but I can’t serve a Section 21
The penny usually drops when you reach for a Section 21 Notice and read the notes which tell you what you have to do to serve a valid Notice on your tenant.

If the Deposit Protection Legislation has not been followed, you’re screwed – meaning your only option is the hassle of a Section 8 Notice where you must prove grounds for eviction (which you may not even have).

3) The Judge threw out my Section 21 because I had not protected the tenants deposit
Most savvy tenants will take advice when they are served with a Section 21 and one of the first questions they will be asked is “Did your landlord protect your deposit?” Followed by “Did he send you the legally required information about your deposit protection within 30 days?”

If they cannot answer YES to both questions they will be told to contest the Section 21 in court. That’s when the Judge will most likely look at the details and throw the case out of court, so here you are.

4) A bloke in the pub told me that I should have protected my tenants deposit – what is he talking about? I didn’t have a clue!
This is a typical case where the landlord has just one property, from when he moved in with his girlfriend, and hasn’t a clue about the landlord legal requirements. You have also heard through your sources that the tenant can gain compensation… and now you’re scared, wondering if it’s all true.

Yes, it’s true.

5) I forgot!
You forgot to protect the deposit and/or serve the prescribed information (not sure how many people will believe this one!).

Any of the above sound depressingly familiar? If your case is not one of the above (or similar), please leave a comment with the details…

I didn’t comply with the tenant deposit legislation– what can I do?

Now, let’s get to the crux of the matter.

As it stands, these are your options:

  • Recommended solution: Protect it now and serve the prescribed information hoping that if an issue arises and it goes to court the Judge will take the view “better late than never”
  • Pay the deposit back to the tenant and hope that he doesn’t find out that he can get compensation, although it might be difficult to explain *why* you’re giving it back.
  • If you’re trying to get rid of a rogue tenant, use a Section 8, with grounds for eviction.
  • Do nothing, but sit tight and pray that your tenants don’t realise protecting the deposit and serving the Prescribed Information is a legal requirement and/or they don’t care enough to seek compensation because you’ve been an amazing landlord.

If your tenant hasn’t mentioned anything…

There’s a good chance your tenant isn’t aware of the tenancy deposit legislation or the ramifications of failing to comply. It’s also not unusual for tenants to be aware, but waive their right to prosecute because their landlord has been reasonable throughout the tenancy.

The point here is that you don’t want to give your tenant a reason to look into the legislation or exercise their right to claim compensation.

  • The most common reason why tenants proceed to take legal action is because they feel screwed over by how the deposit has been handled (i.e. when landlords try to make deductions over trivial and menial damages, which actually, quite often fall under wear and tear). So when it’s time for them to vacate, forget the temptation to deduct £90 for carpet cleaning, or £50 for picture hook repair, just let it go. Otherwise they may start looking into their rights. Generally speaking, biting your lip and absorbing those costs is the safest and cheapest option!
  • The second most common reason is failure to complete repairs promptly, or making repairs at all. Ignoring your duty to maintain and repair is a sure-fire of pissing your tenants off, consequently giving them reason to prosecute given the opportunity. So with that in mind, and ethics aside, it might be sensible to ensure your attend to repairs and maintenance issues promptly, and generally be a good landlord all round (you should be anyways, mind you!).

    It’s also worth noting that if your tenant does take the matter to court to seek compensation (regardless of whether you’ve been a good or bad landlord), some Judges do take into consideration how the landlord has conducted themselves during the tenancy before determining how much they should be penalised.

Can I get in serious trouble for not protecting my tenant’s deposit? What can happen?

Putting it bluntly, you have broken the law, so yes, there can be consequences.

  • A tenant, who takes legal action, can expect to be awarded compensation because his legal rights have been denied. A Judge has the power to award between 100% and 300% of the deposit in compensation and may also instruct you to return the whole deposit. This can be an expensive loss, not just because of the compensation, but also if you actually need use the deposit to cover damages.
  • Because you have not complied with the law, your rights to use legal process to remove a rogue tenant have been reduced- you can no longer use Section 21 of the 1988 Housing Act (which is often the most efficient method of removing a rogue tenant).

My tenant is threatening me with legal action, what should I do?

Ok, so presumably shit has hit the fan; your tenant has discovered you failed to comply with the deposit legislation, and now they’re after a handsome payout. Unfortunately, this is becoming a terribly familiar scenario, rightly or wrongly so.

What to do at this stage will depend on the individual circumstances, so there isn’t a simple solution for all. However, there’s more information available in the “ways you can legally end a tenancy agreement.

My letting agent did not protect the deposit…

Oh dear.

Your hired help has failed you. Common scenario.

So where do you stand in this case? Are you given the luxury of mercy? Unfortunately, you’re in the exact same position as if you have no association with a letting agent. If its of any consolation (which it probably won’t be), the law was specifically changed in the Housing Act 2004 to allow tenants to sue the agent as well as the landlord for the penalty for non compliance of protecting the tenancy deposit.

If you are using a Letting Agent and they do not protect your tenants deposit correctly– you’ll still ultimately be held responsible. Even if you have not touched a penny the law states that the deposit was taken on your behalf and therefore you are responsible. That’s why it’s essential to ensure that your Letting Agent is a member of a Property Redress Scheme (legally required since October 2014) so at least you will have redress if they screw up.

A Letting Agent cannot go to Court for Possession without the property owner, he can go with you as what is known as a “McKenzie Friend”. He can complete the Notices and other documents but you must sign them. Only a legally qualified person can represent you in Court.

Does anyone else have any additional tips to share? Do you have any experiences to share regarding this matter, weather you’re a landlord or a tenant? I’d love to hear your story!

545 Comments- Join The Conversation...

Showing 495 - 545 comments (out of 545)
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David 24th December, 2017 @ 01:06

@AJ

It does depend on what you mean by resolve?

If you mean can you pay less, most certainly YES.

First of all we need to determine some facts of the matter, do not give to many personal details on this public blog, change dates but keep number of months same.

The sanctions are now BETWEEN 1x and 3x the deposit PER TENANCY, there is case law that you can refer to that reminds the Judge that they are entitled to apply as little as 1x the amount.

Costs will depend how the action is bought, the claim companies try to use a track that allows them to seek costs, but I have successfully got that thrown out and their own Barrister forced to agree.

£6500 is a strange amount, on a deposit of £1200 the sanction would be a max of £3600 per tenancy, yet if it was that kind of tenant one wonders if the tenancy was allowed to expire and became a Statutory Periodic (i.e. the tenant stayed beyond the expiry of the tenancy and no new agreement was signed. Alternatively, the tenant could have signed a new tenancy as opposed to a renewal of original agreement.

I would have thought that if this was a money grab the opening gambit would have been to ask for at least £7200.

On the other hand if it was a claims company they do not usually mention money in the first instance, the first thing they try to get you to do it admit liability.

So either you are only providing minimal information, which is not good because it makes it hard for me to help you.

It may be wise for you to communicate any details of your case by private message via the forum of this site, join it using the "Landlord Forum" at the top of the page.

then activate your account by clicking on the email link it sends you, then login to the forum and once logged in follow the link below to find my profile

http://bit.ly/davidpip

Please clarify whether at this stage it is the tenant, a solicitor or a claim company writing to you, also what communications have been had thus far.

You also have the option to issue proceedings against this tenant, this can recover you damages and lost rent, giving him a CCJ which can be escalated to the High Court. Now whilst it is true to say that deadbeat tenants usually have nothing to go after, if he wants to bring an action you can file yours as a counter claim and have them heard together. Important to keep your claim under £10k so it remains in the small claims track.

Depending on your answers, I have different suggestions, if it is just the tenant then the page below may help you, but before you contact them I would like to know the basis for the amount.

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

As this person owes rent and is contractually liable for damages is quite feasible to put them off claiming, but the approach will depend on the circumstances.

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Bee 2nd January, 2018 @ 16:46

Hi
yes you have a chance but you will have to pay a solicitor to handle the case for you.
i made a silly error like that myself they wanted 3x and due to similar issues with tenates and proof they were bad tenantes i ended up paying alot less but saying you forgot alone won't cut it i'm afriad.
worth fighting don't give up without a fight

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Chuddy 3rd January, 2018 @ 07:51

I have posted on the Site before.
I paid £3,500 Deposit In July 2017, the Deposit was not Protected , I did ask my Landlord about this as I did not receive any Information from Deposit protection Companies as I have done In the Past. He emailled me back stating he did not have to put It In a DPS , he had his own Deposit Scheme.

When we agreed to take on the Tennancy there was a Considerable number of repairs that needed completing , the Landlord said all the Repairs to the Property would be done within 2 weeks, 6 months on none of the repairs have been done. I have numerous emails from the landlord with regards to Tradesman attending the house to do the work required but no one has ever turned up.

I am very annoyed that we are paying a considerable amount of money for a house that has not been maintained at all and the promises given by the Landlord have not been kept, I decided to hold back rent payments. He has now Issued a Section 8 Notice, I am not going easily the rent arrears are less than 2 months, so I am going to let him to me to Court so I can defend the Section 8.

I am getting threatening emails stating If I do not leave, he will use whatever means he thinks fit.

He told me he owned the Property , I have found out he does not and he Is a Residential Agent, If I got to Court for him not protecting the Deposit, Is the Landlord also Liable.

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John 8819 3rd January, 2018 @ 12:37

Hi There,

Just looking for a bit of advice. we moved into a property in april 2016. the landlord has just this property that he used to live in but has moved to another property and rents this one out. we paid a deposit to a letting agent and a 6 month tenancy agreement was signed. the landlord wanted to use them for 6 months. after 6 months the landlord stopped using the letting agent and asked us to pay the rent directly to him. I requested the deposit to be paid back to me on the assumption the landlord would want it to protect himself alongside a new tenancy agreement with him.

He never contacted us about the deposit or a new tenancy agreement.

In oct 2017 because he was in contact with his mortgage company over a new rate they advised him he needed a tenancy agreement and deposit. In nov 2017 we paid him the deposit and he said it was at his discretion if he put it into a protection scheme. i advised him it was a legal requirement. he came back and said he would want to keep it in his bank account and would use the the insured scheme but wanted us to pay the charge for this, we refused. was that the right thing to do? i advised him of the free custodial scheme which he aid he would look into. he has not got back to us.

My questions is if he doesn't protect the deposit, are we covered as he said we should have never requested the deposit back from the letting agent.

Also are we covered because he offered to protect it in the insured scheme but we refused because he was going to charge us for it?

i am worried that at the end of the tenancy he will be very difficult in paying the deposit back.

Thanks

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David 3rd January, 2018 @ 12:51

@Chuddy

I saw your post before and replied to it in response 464, with a suggested means of contact, but you have not engaged since.

The Landlord is the person responsible, they can in turn hold the agent responsible for their failure to protect the deposit and any consequential losses (such as legal fees) that the Landlord may suffer.

It is a legal requirement that the Landlord's name be listed in the tenancy agreement, they can use the agent's address as an address for service, but that should be stated as such in the agreement for legal reasons.

First thing to do is pay £3 on the Land Registry website and find the name (and maybe the address) of the real Landlord. Then we can write to them.

I would take the behaviour of this agent as harassment, you need to document every event, ideally as it happens

You have the right to change the locks and considering the behaviour you have been subjected to I would do that, keep the old one to restore at the end of the tenancy. All you need is a Cylinder, cost around £15 at B&Q or £3 on eBay. Is very simple to change, check on YouTube.

If the Landlord or their agent breaks in then you call the Police and have them arrested.

So what he thinks fit is a load of nonsense, in the UK you have the first six months secure before legal proceedings can be taken without cause. Then you have any additional security offered by the tenancy agreement itself. e.g. if the agreement is for 12 months and there is no break clause or legally valid termination clause (a lot of landlords put clauses in that are not enforceable), then you have until that date.

Even after the 12 months you can remain in the property and the a new tenancy will be formed by law, called a Statutory Periodic Tenancy (SPT).

If a Landlord (not an agent) wants to evict you they have to follow strict legal procedures and an obstreperous tenant can even frustrate these, but sometimes it is better to just leave. However, I do not think that this is one of those times because at this stage you are not dealing with the Landlord you are dealing with an agent.

Under the law you are entitled to request the details of the Landlord (assuming they have not already been provided), you can even legally withhold rent until they have been provided but you must pay it when the details have been provided. You must ask for the address for service.

The agent may give you the landlords name and the agents address, in which case you write a simple letter before action saying that you wish to speak to them directly as the agent has been abusive and is harassing you, as I offered previously I can draft you such a letter via the forum private messaging. The letter will be in accordance with CPR which means you can instigate proceedings thereafter without further notice.

As I advised before it is CRITICAL that you involve the Council in any issue of repairs so that they issue an Improvement Notice, failure to carry out repairs thereafter can lead to heavy fines and in some circumstances even stronger action. So call the Council NOW!

The two methods of eviction for tenants with an Assured Shorthold Tenancy, both cost a lot of money in Court fees to enforce which is why you should ignore any idle threats about whatever an agent thinks is fit.

Method 1 - NO FAULT EVICTION

This which means you did not do anything wrong, they just want you out, this is known as a Section 21 and must give you two clear months notice. They have to give you the notice on a prescribed Government form (usually 6a), that form has to be served properly in accordance with the Housing Act. The notice can be dismissed for a lot of reasons including; failure to protect a deposit within 30 days, failure to issue prescribed information regarding deposit protection within 30 days, no EPC, no Gas Safety or no How to rent document. The rejection of the form can be done a week before the 2 month notice expires, this is best done via the Court but definitely by recorded means.

More details on S21 are here:

http://www.propertyinvestmentproject.co.uk/blog/section-21-notice-of-possession-order-form/

Method 2 - EVICTION with FAULT(s)

This is known as Section 8, there are mandatory reasons such as being more than 2 months in arrears and discretionary reasons such as have paid rent late repeatedly. Judges want strict (usually independent) evidence of the alleged faults and if the tenant can show that they are somehow reformed they are often given another chance.

The notice for this is shorter but it can take months to get so it works out about the same. More details are here:

http://www.propertyinvestmentproject.co.uk/blog/section-8-evicting-tenants/

It is important that you get the evidence for the things you are alleging, for example emails where the agent says he does not have to protect the deposit, if these were done verbally I can draft you some emails that will help you get such confirmation.

As I said previously I did respond to you before, the message is below for your convenience, if you require further help please do it via the forum as your case is live and it may prejudice your position to provide too much detail here.

Message 464

@Chuddy

No he cannot issue S8 until you are 2 months in arrears, you need to report the repairs to the Local Council Housing to prevent revenge eviction against S21.

You should ask them if they have historical reports for this Landlord.
£3,500 wow you are quids in, the repairs will look bad on him if it gets to Court.

Do not worry, it probably will not get that far.

I can write you a "letter before action" that will make him take this seriously, but I suggest we do it via the forum in case it comes up if he googles content of letter.

Use the landlord forum link at the top of this page and once joined send me a private message via this link

bit.ly/davidpip

He is facing £10,500 plus legal fees, your case sounds very straightforward, he had an obligation to protect and failed to do so. His denials simply serve as evidence against him.

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David 3rd January, 2018 @ 15:01

@John 8819

The position is quite simple, whether there is an agent involved or not the Landlord is liable for making sure the deposit is protected continuously for as long as your money has been held as a deposit. Also liable for such periods even if they return the deposit.

One of the reasons that the The Housing (Tenancy Deposits) (Prescribed Information) Order 2007 was enacted was because Landlords or their agents were not informing tenants where their deposit was or how to get it back after the tenancy. Note that it is the deposit protection company that decides what you get back, the Landlord would need to make a claim to them, they would need to provide evidence (differences in inventories signed by yourself) and you would have input before any decision was made.

So not only is it a legal requirement that the deposit it protected within 30 days but also that the Prescribed Information relating to the protection of the deposit is also provided within 30 days. EITHER can trigger a sanction payable to you of between 1x and 3x the deposit, PLUS the return of the original deposit.

Agents tend to use insurance backed schemes, these usually provide a few months overlap but require that the Landlord is a client.

In October 2015 the Deregulation Act came into force, this put additional requirements to provide an EPC, Gas Safety Certificate and the Government How to Rent booklet. Failure to provide these will block an eviction notice and for Gas Safety may lead to fines.

Dereg Act also gave Landlords a break in that it allowed them some consideration if they originally protected their deposit under one AST and it REMAINED protected when the tenancy became an SPT. However, if they did NOT originally protect it or get their own protection when Agent kicked to the curb, then they will have no such consideration.

You did not say whether your initial six month tenancy was Renewed, Replaced, Extended or none of these, i.e. you just stayed in the property and an SPT was create by statute.

The sanctions apply for each tenancy and even after Dereg act to SPT's if original was not protected propertly.

Having a crap agent, not understanding the law, thinking you could get this that or the other are null defences under the legislation.

The question comes to how long do you want to stay in the property, I get the impression you are thinking of leaving. If not and if the deposit is indeed unprotected then you would be wise to ask for a new tenancy agreement to give you more security (for say six months), if that tenancy is also not protected then it adds more sanctions. This does not mean you need to take action, this is all leverage for negotiation in the event of any dispute.

For now check on the three links below, put the relevant details in, try different dates, the original date you moved in, the date of any new tenancy, and dates since you discussed the matter.

http://bit.ly/chkdep1

http://bit.ly/chkdep2

http://bit.ly/chkdep1

Feel free to contact me via the forum if you wish to discuss anything confidentially (details given in previous post).

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David 3rd January, 2018 @ 15:03

@John 8819

http://bit.ly/chkdep3

for that last one

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Chuddy 4th January, 2018 @ 05:28

Hi David,

Thank you for your response.

I am undergoing Hospital Treatment at the moment and all this stress Is not helping.

We have a AST tennancy Agreement, for a Period of 3 years, with a Break Clause after 12 Months.

The Agent has stated on the Tennancy Agreement that the Deposit would be held by the DPS.???
I have checked all Deposit Schemes and It Is not held with any. And he emailed and told me Verbally that It Is held In his own Deposit Scheme. The Registered owner of the Property Is not named on the Tennancy Agreement.

I was not given a EPC, Gas Certificate or How To Rent Booklet .

He gave us a Section 8 Notice to Vacate the Property by 11/01/18, as this Is when the Rent Is next Due. 2 weeks notice Is unrealistic as I was In Hospital Last week and with the Notice being given over the Christmas Period It Is not a good time to look for another Property.

I have no Intention of moving out on that Date, and he will have to take me to Court for a pocession Order.

He has now advertised the Property To Let Immediately, so has no Intention of doing any Repairs which have not been done for over 2 years. It seems once again he Is going to blame Previous Tennants as to the Condition of the Property, promise everything will be rectified and take another Deposit.

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mr.spacemaker 4th January, 2018 @ 09:01

@chuddy

Sounds very much like an open and shut case. Your landlord is screwed, which is very unfortunate for him as it very much sounds like it is the agent that is at fault.

You are holding all the cards so you have nothing to worry about.

Follow David's advice - change the locks, speak to housing services at the council immediately for an inspection regarding the repairs, and send a letter before action.

If you want to stay in the property, the ultimate goal of this should be to initiate direct contact with the landlord and assuming he is honest and decent (unlike the agent) negotiate a better deal with him and get rid of the agent. Obviously you also want the repairs started immediately and a new tenancy with protected deposit and all the rest.

The second the landlord speaks with a solicitor, the council, or citizen's advice, they will realise that the section 8 notice is completely invalid, and that section 21 is not possible without returning your entire deposit. Even then they will still be liable for the sanction, should you wish to pursue.

Good luck, this guy sounds like exactly the kind of person who has messed everything up for honest landlords!!!

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IfOnly 4th January, 2018 @ 10:33

Hi, question for David.

I mucked up! I didn't protect a deposit made in Aug2007. I was a new landlord unaware etc. No excuse though I should have since deposited it, I didn't. My tenant has left and after requesting their deposit back, i responded. I went through damage and doors missing etc that were above and beyond wear&tear. Out of there deposit there was a small amount to return. It seems that they have took advice and are requesting DPS number and full deposit back.
They have been good tenants and I have been a good landlord ever their tenancy. However there are costs to me as a landlord as explained regarding damage etc.
A new tenant has moved in who has paid their deposit and I have put that in A DPS scheme.

I was thinking of putting previous tenants deposit in the scheme (better late than never) and go through necessary procedure with DPS to retain some of deposit for repairs. I can't, the new tenant has a deposit placed under that address! Help and advice if yo are able........

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David 5th January, 2018 @ 16:24

@IfOnly

Can you please clarify whether there has been one continuous AST since the 2007 start date, or was it extended, replaced, renewed or just became Statutory.

I will need some dates, these old tenancies can be the most expensive.

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IfOnly 8th January, 2018 @ 14:03

Thanks for your response. I have decided to repay the deposit in full.

Regards

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David 8th January, 2018 @ 14:11

@IfOnly

The reason I asked you for dates is that might be a mistake.

This is particularly true for old tenancies because there have been amnesties you have missed.

You may still be forced to enter the deposit amount again into a scheme.

It also does not remove your liability to sanctions.

As pointed out you could have liability PER tenancy so I need to know whether one long tenancy or several smaller ones

I ask you questions for a reason, it could take 20,000 words to point out all the various options, case law and acts.

If you wish to answer the questions I would be pleased to advise otherwise good luck and remember the tenant can bring action at anytime over next 6 years.

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desperatetenant 11th January, 2018 @ 14:44

Hi David

Just looking for some advice re deposit protection.

I moved into a flat in October 2016 and the letting agent only protected two-thirds of my deposit (we're on an AST). We renewed in early October 2017 and at the end of November 2017 we realised that they had only protected the two-thirds. When we pointed this out they then protected the other third and only sent us the second Prescribed Info once we chased, which was more than 30 days late.

Do you know what our rights are as one-third of the deposit wasn't protected for 13months? Can they serve us a Section 21 notice as it's now finally all protected and we have the PI?

Thanks

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David 11th January, 2018 @ 15:15

@desperatetenant

You do not say WHY they are serving the S21, if they renewed the agreement in October 2017 for a year and the tenancy does not have a break clause, then the S21 can be dismissed because the contract itself gives the security of tenure.

S21 is a no fault eviction process, often misused for rent arrears etc (because it is easier), if there were rent arrears then they should have served a Section 8 notice which is where tenants ARE at fault.

If a Landlord or Agent issues a S21 then you must realise that it is only a matter of time before you are out, so sometimes it is better to agree a settlement which includes departure on an agreed date and a positive reference.

The failure to protect the deposit IN FULL counts as a failure with regard to the sanctions payable to you of between 1x and 3x the deposit, the protection of the shortfall and new PI outside the 30 days is confirmation of the failure.

However, the legislation that allows a S21 to be thrown out is about the state of play AT THE START OF THE PROCEEDINGS, S21 is an accelerated procedure and starts with the issue and filing of the S21 notice. So on that date, it seems to me the deposit WAS protected in full.

There are 3 other reasons the S21 can be dismissed

1. Failure to issue EPC at the very beginning (before really) of the tenancy and then every 5 years.

2. Failure to issue the "How to Rent" document, this must be reserved before the S21 if the Government issues a new version in the time between the original tenancy and the S21.

3. Failure to provide a valid Gas Safety certificate for the property (annual requirement).

I do not have enough information from your post.

Other things to check are that the Landlord is listed in the tenancy agreement (not the agent) check this by doing a £3 check of the property at the Land Registry website.

Note if the Landlord is not correctly listed you may temporarily hold rent (which must be paid later) until they provide the Landlord details, they ARE allowed to give you the Landlords name and their own address as the address for service.

Now the way I would play this is to inform the Landlord directly (getting address from Land Registry or Tenancy agreement) or the agents address if they have confirmed it is the address for service.

I would say that you are about to issue a letter before breach of Section 213-S15 of Housing Act but you are open to resolving things amicably and would like to discuss the matter on the phone with the Landlord.

The agent may try to avoid this in which case you would ask for a written confirmation from the Landlord that they want the Agent to negotiate this matter, despite the obvious conflict of interest.

Typically you would get a Landlord to offer 1x the deposit (the minimum the Court is allowed to give as a sanction), plus the return of your deposit plus a positive reference.

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desperatetenant 11th January, 2018 @ 15:55

@David

Thanks for the helpful response. They haven't issued a section21 notice, I was just worried that they will so was checking my rights.

I have already checked and the landlord details on the TA are the same as the land registry details. Our difficulty though is that the letting agents have told me that the property is part owned by them and the landlord (who I think works for the letting agents) but it seems that for all issues the "landlord" has the final say and the LA don't support us in any way.

Thanks again for your response, it's good to know that they're very much still at fault for not protecting the deposit in full or sending the PI for the second part within 30 days.

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David 11th January, 2018 @ 16:27

@desperatetenant

So not quite so desperate!

The owner is who is registered on the deed at the Land Registry, any rights, claim or charge on the property would also need to be filed at the land registry.

The absence of that would suggest that the agent is bullshitting.

I have had a few cases where the agent has tried to suggest that they own the property or are the Landlord, it seems to be a common thing for the avoidance of tax.

Might be worth an enquiry to HMRC just to clarify whether they think the Landlord is the person named as the Landlord or the Agent.

Do a Companies House search of agent too, the Landlord owner may be a shareholder of the agent or "person with significant control" but that does not make a limited company the owner of the property.

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Kat 19th January, 2018 @ 18:20

I have just one property with very good tenants . I am now ready to sell and have advised tenants that I will try and sell to another landlord. I am worried that although I have kept the deposit in the account rent is paid into I have never secured it. I have no intention to with hold it once property is sold but am worried that I will get in to trouble having not secured it. Is it too late to do this now .

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David 19th January, 2018 @ 20:09

@Kat

There is no avoiding this, you need to protect the deposit as soon as you become aware, that means NOW! The buyers Solicitor will check, especially if you sell with tenant remaining in property.

It will help your defence in the event of a claim, could be difference between 1x and 3x penalty.

I think you should come clean with the tenant, you have to serve them with the Prescribed Information paperwork anyway.

Some Landlords pretend that they have moved it from one deposit company to another but all can be checked online by a savvy tenant.

So maybe you offer the tenant a settlement agreement, you agree to try to sell the property without vacant possession, you agree to give them say £300 and a positive reference. They agree to accept that payment as full and final settlement on any legal claim regarding the property including S213-215 of Housing Act.

See this page for advice on negotiation with tenant

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

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Lolly 23rd January, 2018 @ 20:22

Hi there I wonder if anyone can give me a bit of advise as I’m losibg the will to live my my previous letting agents!
We left a property at the end of November 17 which we had lived in since August 2006. No issues with damage etc we were told our deposit would be in our bank in a couple of weeks. 8 weeks on and despite numerous phone calls and emails promising me payment would be made ASAP, still nothing, They never return my calls and I’m constantly chasing them. I assumed my deposit wasn’t protected as it was paid before 2007 but from what I have read am I right in thinking that actually it should have been?
Any advise would be gratefully received!

Thanks in advance

Lolly

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David 24th January, 2018 @ 00:12

@Lolly

Yes the deposit should have been protected under S213-5 of the Housing Act 2004, the failure to protect for such a long period and the failure to return the deposit will almost guarantee a sanction of 3x the deposit and this is PER tenancy.

So if you had 3 AST's over that period and then your tenancy became SPT your Landlord would be looking at 4 x3x the deposit.

Forget the agent, it is the Landlord that is liable, he can then take legal action against the Agent if they had promised to do it (full service agents usually do).

You can find the name of the Landlord from your tenancy agreement or go to the Land registry site and pay £3 for the deeds to the property.

For now check these links to see if your deposit was protected.

http://bit.ly/chkdep1

http://bit.ly/chkdep2

http://bit.ly/chkdep3

Even if they protected the deposit, the failure to issue the PI also triggers the sanctions but not in addition to the sanctions for failure to protect.

You could use a claim company but they will take 33% of your money, it is such an open and shut case, you can do it yourself, but I always advise offering a settlement, if they refuse it then they can be made to pay your legal costs.

I can write you a letter for the Landlord offering a settlement depending on how bad it is and guide you though the paperwork if they do not settle. I have acted for tenants where there was an Agent involved and the Landlord was so litigious that the agent paid up in full before we even needed to negotiate. Do not waste any more time on the agent.

I would suggest you contact me via the forum for privacy, scroll to the top of the page and click on the Landlord Forum link, join the forum site, then click on the email confirmation and log back into the Landlord forum site, when you have logged in click on the link below and send me a private message with details of he number of tenancies. As things stand I think you are looking at 3x the deposit plus the return of the deposit itself as a minimum (the landlord would be wise to settle because of the blatant failure and he will only end up paying yours and his own legal fees if he does not settle).

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David 24th January, 2018 @ 00:13

@Lolly

Sorry forgot to paste my forum profile link, here it is

http://bit.ly/davidpip

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Hab 1st February, 2018 @ 10:55

I wonder if anyone can provide some advise, if i have provided an AST without deposit can i still issue section 21 after the AST has run out?

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David 1st February, 2018 @ 11:10

@Hab

If your AST has expired a new Statutory Periodic Tenancy has been created by statute.

As you did not protect the original deposit it is deemed that you did not protect this deposit unless you are in the first 30 days of expiry in which case you should immediately protect the deposit and issue the prescribed information.

To be honest you need to protect the deposit as soon as possible anyway as this will mitigate your loss in sanctions that are awarded.

Right now you are facing a sanction of up to 3x the deposit for EACH of these tenancies PLUS the return of the deposit.

Your S21 would be struck out if you tried to issue it, the tenant will take advice from their Council, maybe Shelter charity for homeless or just a bloke in a pub.

They will be told to check the deposit situation online but also to check the following:

1. That you provided an Energy Performance Certificate prior to the commencement of the tenancy. (these are often shown on sites like Rightmove) they are valid for 5 years.

2. That you provided a valid and current Gas Safety Certificate and that there is a valid one at the time the S21 is issued.

3. That you provided a copy of the Government "how to rent" document at the beginning of the tenancy AND now that the tenancy has passed to be an SPT that you provide a copy of the current one if it has change (WHICH IT DID IN JANUARY 2018).

If you failed to protect the deposit within 30 days it goes without saying that you failed to issue the PI on the original tenancy. However, you must also issue the PI for when you did/do protect the deposit, S21 in invalid without it.

The best way to proceed is to get in front of this, protect your deposit and try to negotiate a settlement with the tenant, how to go about this is explained on the page below.

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

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Silly Mistake 7th February, 2018 @ 16:37

Problem tenants is an understatement.. tenants left in August with five months rent arrears. while I hear I'm going to pay, i will call you back, its just not happening. They obviously have left and moved on leaving a trail of debt, I forgot to register their deposit (yes i know) so in that situation what chances do i have legally of recovering the debt. Their parents are guarantors again, how far can i push this to recover the bill. From beginning i have said to both tenants and parents that i will not add any interest for late payment as that will not help them clear the 5k bill, hoping that would give some incentive to speed things along. I am aware that not having registered the deposit really doesn't help and they are full of the ways to miss and avoid any responsibility for bills, as the numerous summons to court are posted to the address by various companies. I guess if the money is never to be seen i just need to draw a line under it.

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David 7th February, 2018 @ 19:47

@SillyMistake

I did answer this, have they actually started a claim against you for sanctions?

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Silly Mistake 7th February, 2018 @ 21:30

@David
Thank you, Sorry I couldn't find the previous post. No they haven't started any claim for sanctions that I am aware of.
Thank you

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David 7th February, 2018 @ 23:13

@SillyMistake

This was my previous reply, which I have updated slightly

You are in a better position than most, you have guarantors, but as always with debt you have to make sure they have something to lose before you take enforcement action.

You can go after the guarantors, check their address on Zoopla first to figure out when it was last sold, if it has not been sold since they signed as guarantors. If not then spend £3 to get copy of title from Land Registry site to determine if they are owners, i.e. they have something to lose. If they are local go their house, see if they have cars worth over £2000 plus your debt.

Then you just write them a letter before action saying that your attempts to get payment of arrears from their offspring have failed and you are now putting them on notice that if payment is not made or agreement entered into within 14 days then you will be proceeding to take them to Court.

You are under no obligation to accept long payment terms, the max I would give them is 3 months with one third per month. Debt collectors prefer 50% down to prevent action with 25% for the following two months.

Your agreement not to charge interest was subject to them servicing the debt, they have not made any attempt to do so, so you can put it in your claim. In these types of Court claim interest is calculated daily but your tenancy agreement may have stated different. From Aug 1st a reasonable level of 4% above BOE base rate means you can add £121 to the debt, but you could just as well use your banks rate.

If I were you I would see the tenancy deposit thing as entirely separate, look at the pages below and the comments I have made, basically if you are a novice Landlord you might get away with a 1x deposit sanction.

If the tenant has the audacity to raise deposit issue here or on Negotiation page and I will walk you through the negotiation.

In your position I would see them an entirely different things, the fact is that the parents are more likely to have the money or to have leverage. So going after them makes the most sense.

You can raise in the small claims Court as it is under £10k (naming all four of them as defendants or just the parents), you will not get legal costs but you can ask the Court to consider the interest as it is part of the debt as well as the Court fee and various allowed costs.

Usually the very real threat of a CCJ will scare the parents into paying, if not your tenants, but if not you will have a CCJ which you can enforce, but it is only worth doing so if they have the money.

Sometimes sending completed Court papers that you are about to file does the trick, I would send these as a final letter before action. It will show the Court you have them every opportunity to settle.

This are the tenancy deposit negotiation pages:

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

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Salda 8th February, 2018 @ 10:23

Hi. When my previous tenant moved out he was very desperate to have his deposit back asap but it took him about 10 days to receive from DPS. In the meantime his friend was very desperate to move in. So it was stressful time for all of us. As a result I asked current tenant if he would prefer me keeping the deposit instead and he said fine. I sent him confirmation email to cover my back and kept it in my bank. As things do not go well with this tenant I now protected the deposit. However he now threatens to take legal action against me! Where do I stand? Thanks

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David 8th February, 2018 @ 15:07

@Salda

Sorry to deliver bad news

The S213 of the Housing Act recognises the dynamics of the Landlord Tenant relationship, thus it specifically apples despite any agreement.

(9)The provisions of this section apply despite any agreement to the contrary.

https://www.legislation.gov.uk/ukpga/2004/34/section/213

It might help you in mitigation and it is worth pointing out case law that confirms the Judge may choose to apply only 1x sanction at their discretion.

This is the case law I was referring to

http://www.bailii.org/ew/cases/EWHC/QB/2014/4729.html

Considering this, the next stage is to negotiate, ideally before they involve a claims company who will only be interested in demanding the maximum and then trying to get their fees. (If that happens I can help you with that).

The owner of this site has prepared the following page to help you with negotiation, the page is this one:

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

If your case is complicated and you want to contact me directly you can do so by joining the Landlord forum link above, when you have confirmed your email and then log back into the Landlord forum site you can follow this link to send me a PM to discuss confidential aspects you might not want to publish in case they identify you.

bit.ly/davidpip

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Hab 8th February, 2018 @ 17:00

@David,

Thanks for the reply, but we did an AST without any deposit. So We created and made an AST contract but did not take any deposit. How can the deposit scheme still apply?

Yes we have give EPC , rent guide and gas saftey certificate then issued section 21.

Thanks

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David 8th February, 2018 @ 17:49

@Hab

Sorry I thought you meant without deposit protection.

If not deposit was taken then clearly there is nothing to protect.

You are fine and you seem to have done all the other blockers to an S21.

Sorry for my misreading that.

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Elsa Phillips 14th March, 2018 @ 16:44

I did not protect the tenants deposit. When they left there were certain things that needed to be done that they had not done to comply with the terms in the lease. Costing were done and a figure agreed and they were returned the difference. Now 3 months down the line they are saying they did not have to comply with the conditions of the lease and as I had not protected their deposit they want their money back.
What can I do and do I have to pay it back?

Elsa

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David 14th March, 2018 @ 18:54

@Elsa Phillips

Yep they can come after you for up to six years from becoming aware of your failure to protect their deposit.

You should not be worrying about whether you have to pay it back unless it is more than 3 months rent, you should be worrying whether they will use a claims company and you end up paying their costs although I can help you with that.

Depending on the amount, my advice would be to wrap the repayment up in a settlement agreement, do not quibble or negotiate if the amount is less than one month's rent it is a good deal because that may be the minimum you have to pay.

See this page for further advice about negotiating but as they already have an amount in mind I would go for it as long as it is not more than the max settlement.

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

You did not say how long the tenancy was or when it started, if it was prior to Oct 2015 and you let the tenancy roll over to a statutory periodic tenancy then you could be facing two sets of 3x the deposit. If you renewed the tenancy for 3 years then each tenancy is liable for the sanctions, albeit that some Judges are questioning multiple sanctions do not count on it.

The failure to protect does not make the contractual obligations invalid, it is just that failure to protect renders you potentially liable for UP TO 3x the deposit. There is potential for mitigation but it will depend on how you have carried yourself and the details of the failure as well as whether you are a novice Landlord.

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@Bob 16th March, 2018 @ 09:55

Hello, some advice please?
My wife owns a property that used to be our family home until we moved out of there approx 5years ago. We had lovely tenants, and all was well for several years before they decided to move on. Towards the end of their tenancy, we had put the house up for sale in the hope we too could move out of rented accommodation and buy a place for ourselves. The old tenants did not want the uncertainty of a house sale looming over their heads, understandably so, and made their own arrangements to amicably move. All well, their deposit, which was protected was returned to them.
We decided to take the house off the market as there was little interest, most probably as a result of the looming Brexit issues.
Anyway, in March 2017 we took on new tenants, a married couple with 3 young children. We had made it clear that there may be the possibility that we put the house on the market again but not during the period of the AST my wife had with them.
At the end of February 2018, we arranged to meet with the family to advise them that we were thinking about putting the property on the market in March 2018 and see what interest we had. We were not in a as there is a penalty to be paid for early exit on a remortgage.
We were hoping that this would give them enough time to start looking for alternative arrangements.
This is when the problems started. A couple of days after the meeting with us, the husband tenant calls to say that he wanted to discuss something with us. I took the call on behalf of my wife, and he explained that he wanted us to serve him a section 21, as he wanted the local council to offer him accommodation. I said that I would have to look into it as we had never done anything like this before. The tenant had then sent me a link by text message for an evictions company, advising that i should take a look at them, and also saying that he would be happy to pay for my costs associated with the s21.
After doing some research, it all looked pretty straightforward but as i began to ensure we had covered all the bases in order to serve a section 21, it became apparent that through oversight, my wife had not protected the deposit, she thought i was doing it, and i thought she had done it.
Either way it was not done. We understand this is against the law and we have made a mistake.
I then explained to the tenant that we were unable to serve a S21 because of this, and it was at this point the wife advised me that they did not want to go down the route of a S21,her family did not wish for her to do this. And instead they wanted us to just give them a months notice and provide them with particulars of sales to prove we were indeed selling the business.
I then arranged for a local estate agent to come over and take photos, which was all done amicably between agent and tenant. I asked the tenant which date he wanted to start the notice letter from and for how long, as we were quite happy to give them as much time as needed, within reason. He advised that he would be happy to have the letter given to them at the expiry of the AST, which is the 21-MAR-2018, and i said i would be happy to give them notice until the end of April-2018.
The estate agent begins to market the property in the mean time online, and has some serious interest from one particular gentleman. When the agent tries to arrange viewings, the tenant becomes very odd and explains that he was not aware that viewings would happen so soon, and that because of his family commitments and issues he cannot allow viewings.
The agent contacts me, i try to discuss with the tenant, and the tenant advises that he no longer wishes to discuss the matter with me (I would like to point out that all of my comms with the tenant have been courteous and professional at all times), and will deal via email only with my wife.
Through the emails, he first advises that he needs the notice of intention of sale to be given to them, including sales particulars before he will allow any viewings. We said we were happy to do this, and also stressed that it was only one very serious buyer who we wanted to have him view the property at a time that suited the tenants, and that we would be happy for viewings to cease until after they had moved out.
Yesterday, the 15-MAR, we hand delivered a notice of intention to sell together with sales particulars, in the hope that the tenant would allow the just one viewing, and then we would leave them be until they moved out.
Not quite so, unfortunately. The tenant emails my wife an email with the starting phrase that she should take this email very seriously. He has now taken advice from the council and they have advised him that he needs to be served with 2 months notice if we are selling the house, and also needs to serve him a section 21. He is demanding the deposit back, as it was celarly not protected, and he will then allow for veiwings to commence.

Sorry for the long prose above, but we just wanted to seek out some advise and come up with a plan of action. We have been very accommodating with the tenant, and now feel that because we have been trying so hard to make sure they are happy and will move out at the end of APR-2018, we have been unwittingly pushed into a corner that is just delaying our sale and causing undue stress.

My wifes thinking is that we just return the deposit (how do we do this so as to not have the tenant cause further issues for is?), which we are happy to do so, and then serve a S21. My question here is can we serve the section 21as soon as the deposit has been returned, bearing in mind the notice of imtention to sell the house has already been sent yesterday and a break notice can only be served in 2 months time, giving a tenancy end date 2 months after that break notice, ie 4 months from yesterday, taking us to mid July. Or do we have to wait until we serve the break notice, then the S21? Naturally, if the tenant does not move after the S21 date, we will need to fo to court and arrange bailiffs, which will take another 2-4 months, taking us to mid Nov.

My thinking is that we put the deposit into a DPS immediately and serve the tenant the correct PI. We take the property off the market, and ask for them to sign a new AST, and calling the tenants bluff and leaving them to serve us notice to leave when they are ready. In fact the tenant had said at our earlier meeting, they themselves were thinking about trying to secure a council property or indeed leave the borough entirely as the wife was not working and they were having health issues with the children. If they dont sign, then the AST will automatically become a monthly periodic tenancy.

The issue is that we dont really know what the mind of the tenant is like now. One moment they wanted a S21 served on them, the next they didnt, and now they do, but will they move out at the end of that or not?

Do we send a strongly worded solicitor letter stating our decision? And regarding the deposit, we know we have messed up, and we know there maybe a strong possibility that the tenant may come back on us about this, but what can we do to best mitigate the whole situation, knowing that we will just have to take any repercussions on the chin.

Any help would be really appreciated. My wifes rhinking is that we just do what the tenant says, as she just wants them out, and my thinking is that what can we do to ensure they are are giben just as much a hard time as they are giving us, and if they wanted social housing they can do that off of their own backs and not with assistance from us.

In terms of current rent being paid, all is up to date, and from the tenant in the past I am led to believe that bcause they get Universal Credit, if they decided to refuse to pay rent, then i could go to the council to ask them to pay rent to us directly. Not sure if that is correct.

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Benji 16th March, 2018 @ 11:35

"Yep they can come after you for up to six years from becoming aware of your failure to protect their deposit."

I don't think that is correct David.
It is six years from the date on which the cause of action accrued.

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Benji 16th March, 2018 @ 12:03

Its just business, don't start playing games.
Return their deposit and serve a section 21.
As you will presumably be using a solicitor for the conveyancing anyway, might as well get them to deal with the lot. Make sure you choose a competent one.

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Benji 16th March, 2018 @ 12:22

Previous comment was addressed to Bob post 529.

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David 16th March, 2018 @ 14:05

@Bob

I am sorry you are going through this, I do feel you have been manipulated from the start by delaying. If you allow the tenancy to expire a Statutory Periodic Tenancy is created in Law. If you failed to protect the original deposit then you are potentially liable for a 2nd sanction of between 1x and 3x the deposit for that new SPT.

First things first, DO NOT RETURN THE DEPOSIT, protect the deposit with a Government approved scheme (DPS, MyDeposits or TPS) do this when you have finished reading this reply in full. Do NOT use an insurance backed scheme, pay their money into a custodial scheme such as offered by DPS and issue the prescribed information by 3 methods as soon as possible and certainly within the next 4 days.

You will still be liable for the initial failure but I can help you with mitigation etc to get it down to 1x rent or a negotiated settlement in due course.

Do NOT issue a new AST, if you want to call his bluff offer to renew your existing one, you can use a single piece of A4 to effectively convert it to a contractual periodic tenancy without creating a new tenancy agreement. All you will be doing is extending the existing tenancy until it is terminated by the tenant giving a months notice and leaving the property or you issuing S21 or S8 notice in accordance with the Housing Act.

Recognising that your tenant may not want to be co-operative and sign such a renewal, you could word this so that by they become bound by it even if they do not sign it, by remaining in the property at the end of the tenancy when it expires on the 23rd March, in that situation what would matter is that you have evidence that the paper is served.

Looking at the dates YOU HAVE LESS THAN 5 DAYS TO DO THIS or else a new SPT will be created anyway.

You MUST protect the deposit and issue the Prescribed Information BEFORE the SPT is created, protecting it gives you evidence that you carried out the action.

You could return the deposit by bank transfer taking screenshots and showing bank statements but this puts you in a weaker negotiating position with regard to settlement of the sanction issue. If there are damages to the property or other contractual performance issues you have right to ask DPS for some or all of that deposit.

Protecting IMMEDIATELY as soon as you become aware helps you in mitigation.

The alternative to renewing is a replacement AST for a fixed term or doing nothing and letting the SPT be created. A replacement tenancy gives the tenant power to mess you around, they can not sign it and if they do sign it you have lost flexibility for a year or 6 months and you can imagine this tenant is going to turn into the tenant from hell.

If you had protected the deposit in the first place I would say it was time to take off the gloves but it is still important to keep things amicable and be seen to be doing so. If the tenant goes to a claim company they will rack up your charged by refusing to negotiate and adding their legal fees. I can help with this but better to avoid it by coming to a settlement agreement directly with the tenant.

Once you have protected the deposit you need to serve the PI, difficult tenants can attempt to frustrate this by not answering the door and you must never gain entry because that can be considered as harassment. All you do is video the PI and you putting it through the letterbox and taping another copy to the front door. You would also email one and send one by normal post and another by recorded delivery (from different places).

The way I would approach this is to call the tenant, tell them that you are confused because it appears they have changed their mind about what they previously stated and you would like to meet up to discuss the way forward. Before you enter the property put your phones on silent and set voice recorder on and leave phones in your pocket. This is just to protect you in the event of any false accusation of harassment and to give you a record you can type up.

At that meeting (if they agree to it) you start by asking what is their preferred tenancy option, do they want to leave the area, do they want request housing by local authority, do they want an open ended tenancy agreement or a fixed term. Try to keep it to open questions, so they say what they want.

Say to them that you are sorry that you failed to protect the deposit, that it you and your wife each thought the other had done it and you are willing to reach a settlement with them.

You tell them that meanwhile you have protected the deposit and here is the prescribed information that tells them the details of the deposit (they will get an email from DPS anyway so they will know but it does not count as PI). Ask them to sign a copy of the PI, if they don't just take a photo of the PI in situ in the property and/or do the video of you posting a copy through the door and sticking one to the door.

This is all going to come down to negotiation so you need to know what the other side wants and what you can do for them.

They can't claim homelessness if they intentionally leave a property, that is why they asked for the S21.

They can't make a claim in another area unless they have/had a "local connection" to that area. They may be able to register homeless locally but tell the housing dept they are prepared to consider moving up North to another town if the Council can negotiate that with another Council.

Once they are in a permanent property (which may take up to a year in temporary accommodation but probably for with kids with health issues) they can do a swap with the Housing Association.

Knowing what they want is the only way you can put a value on what you can do for them. There is no blanket advice because some Councils will fight tooth and nail to prevent the person becoming homeless. They will contact you, ask you if you can keep them longer, ask you if the tenant was antisocial, damaged the property, was in arrears or anything than enables them to deny the tenant their homelessness obligation.

To be honest most Councils have to consider the children so if they know kids are involved they usually do not mess people around, which is why at first I thought the Council just wanted enough evidence to know that they had an obligation (because you were selling). The refusal to allow viewings made me think they were messing you around to delay things. I suppose it is possible the place is a mess or there is damage and they wanted time to cover that up.

I would call the housing department and ask them what the situation is, explain that things had been amicable thus far but you are selling the property and need to know whether they will be taking on the tenant as homeless and if so from when because their tenancy expires in 5 days.

Regardless of the expiry the Council knows they can delay by insisting you issue S21, so you have to factor that in as a cost of doing business. You just need to make the call to gather some intelligence, without giving any away.

If you have it in writing that the tenant offered to pay for it then you have something to negotiate with the tenant about when it comes to agreeing how much you will pay them in lieu of sanction and it can be used for a counter claim should things get ugly.

So if you have to bring eviction proceedings it is Section 8 which require grounds and ideally mandatory grounds, these are covered here:

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

OR it is Section 21 which is a no fault eviction that requires 2 months notice BUT has prerequisites.

http://www.propertyinvestmentproject.co.uk/blog/section-21-notice-of-possession-order-form/

Now as you failed to issue the deposit I have to question whether you met your other obligations that can kill an S21 notice, apart from the deposit and Deposit PI these include

Energy Performance Certificate (prior to occupation perhaps on rightmove)

Gas Safety Certificate - this is critical as is the annual check, do this now if not done already.

How to Rent Booklet - provide this with the PI if you did not provide it already

IMPORTANT: If you allow the tenancy to go SPT you MUST serve the latest "How to Rent" (if newer than previously served) before you issue an S21. As a new version came out in January 2018 I expect you will need to do this, this can be sent via email but belt and braces so a copy by post and a signed copy as evidence of service.

With regard to the payment for failing to protect, see the page here

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

I would be aiming at

* £300 payment on signing of settlement agreement
* No obligation for tenant to pay for S21 as they previously agreed to do
* Positive reference
* No Damages counterclaim
* Cooperation with Council regarding housing

I would point out that you have mitigation so would probably be looking at a 1x rent sanction, this is offset against S21 cost but also the loss of 1/3rd to Solicitors if used as well as cost of Court fee and legal costs incurred by the tenant which they may be held liable for if the Court feels that your Settlement was reasonable and they are wasting the Courts time. The Court must grant a minimum of 1x but they can punish landlord or tenant on costs.

So now get on and protect that deposit, do it NOW!

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David 16th March, 2018 @ 14:14

@Benji

I stick to my advice as to when the six years starts because there are circumstances and case law.

I myself had had claims that go back beyond 6 years, additional tenancies were issued and also unprotected, during this time the tenant was not aware of the Landlord obligation but the Landlord was sanctioned for each tenancy regardless of the typical 6 year limit.

This is also reflected in other law for financial claims.

Note I try to give advice that protects the widest group of people in all circumstances, the law can have lots of loopholes, so such a statement stops people assuming they are safe or getting bad advice.

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@Bob 16th March, 2018 @ 15:18

@David & @Benji, thank you both for your advice. We do have a conveyancing solicitor lined up and will also take advice from them. I will keep you abreast of developments as they happen. Kind regards, Bob.

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David 16th March, 2018 @ 15:27

@Bob

I think you have to move forward on the assumption that the tenant may remain in place for a considerable time and thus there will be no conveyancing.

You may find Solicitors without experience in Housing Act issues ill prepared for how you can be messed around.

For now, protect the deposit and arrange that meeting, considering you have 5 days and they may be working it means getting things done THIS WEEKEND.

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@Bob 16th March, 2018 @ 16:06

@David, many thanks. Point taken. Will do.

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Salda 20th March, 2018 @ 06:31

Hi David.

On below link you mention about "an example Settlement Agreement"

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

Have you managed to do it?:-))

Thanks for your efforts and time. Much appreciated!

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David 20th March, 2018 @ 08:52

@Salda

I originally was going to provide a template settlement agreement to the site owner, I assigned it as a task to 3 people in my team.

It then became clear that this was going to be problematic.

2 came back with very comprehensive agreements, that would scare a tenant shitless. 1 came back with a basic agreement that a tenant would sign but may leave the site owner liable for anything missing (regardless of waiver).

Then we had situations where a claim company was involved and a plethora of other variables.

So I felt it was better to draw these up myself when people have shared with me their situation via the forum.

That does not stop anyone drawing up their own agreement, what matters is that it is titled settlement agreement, is dated, specifies the parties to the agreement, that it refers to any sanctions arising from renting the property (which must be named) under legislation Housing and other acts of Parliament. It should be clear that it encompasses all tenancies for the said property.

It should specify what is being given by each party as settlement and it should be witnessed by someone you can rely upon.

It should specify that in the event of any further claim by either party that the person bringing the claim will be responsible for both sides legal costs and any consequential costs or sanctions.

If you trawl the comments of this thread there are examples given some time ago.

There is also some benefit from you both agreeing this and just writing what you agree, the key is to show intent.

I should point out that no agreement can override common UK law so it will not stop someone bringing a claim if they had cause under the Act, it is just that Judges decide things not Court staff who process claim paperwork.

However, the Court would either dismiss the claim or at the very least take into account the amounts that had been settled. There is enough case law anyway to show it would represent bad faith.

It it worth remembering that if there is more than one tenant all must agree or authorise the other to bring a claim, so by getting just one to agree not to bring or authorise a claim you snooker the others.

Hope this helps, but feel free to contact me via the forum (I have posted enough times here and on the page you refer to how to join it and PM me.

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Salda 21st March, 2018 @ 05:03

Many thanks David for your time

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Jason 8th April, 2018 @ 13:06

Need some advice as we did not protect our tenant's deposit.

We actually sold our property to our tenant, the heritable property part has all been legally transferred. However, there was a private agreement between our tenant and ourselves for our tenant to pay an additional sum for all of the furniture less some personal items that my wife and I wanted to keep. The total amount due to us less our tenant's full deposit less the costs of shipping the personal items that were not included in the sale has never been paid by our tenant as well as nearly 1 months rent (our tenant last paid rent on 1 Feb with a view that the sale would be concluded on 28 February) The sale concluded on 23 March and since 24 March we have had zero communication from our tenant. I spoke to a debt recovery lawyer and he mentioned the issue about the Tenancy Deposit scheme, and that even though our former tenant still owes us a considerable sum as well as our property) they could actually sue for damages even though in effect they have received their full deposit back.

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David 8th April, 2018 @ 14:23

@Jason

Your situation is that for EACH tenancy agreement you are POTENTIALLY liable for Between 1X TO 3X the deposit.

However, note the words in capitals, some Judges are awarding 1x the deposit because they feel there was mitigation. Some are only awarding the sanction for one breach even though there is clear case law and they risk being overturned at appeal.

If while you were the Landlord you had an AST and your tenant did not leave when it expired a Statutory Periodic Tenancy would have been created and potentially incur another 1x to 3x the deposit. Also if you created new tenancy agreements each year (as opposed to extending them) then those too would be liable for sanctions.

The law changes slightly for tenancies after 2015, in that if you protect the first tenancy you are deemed to have protected any SPT created.

In your position you can have this hanging over you for 6 years, your solicitor was right to point out that in the event of a dispute over money that may trigger a claim if the tenant becomes aware. It does not matter if it was paid back or if the tenant subsequently bought the property.

At the same time, if the tenant does come after you then you would also have opportunity for a counter claim. It will not remove your obligation but a Judge may take the bad faith into account when deciding on how much to award.

So you have to factor in whether you write off this amount you are owed but use it in a counter claim if the former tenant comes after you for the failure to protect the deposit.

The other option is to grab the bull by the horns, engage the former tenant with regard to this debt and suggest some form of mediation with a view to reaching a settlement agreement, then in that agreement you specify that it settles any future claim of landlord obligations under the housing act, ideally you would specify S212-5a but that would immediately draw their attention to your failure.

I guess it depends on how much they owe you, how solid the private agreement is, whether it is in writing etc. You really should have attached it all to the sale so that they paid it via the solicitor who handled the sale.

On the basis that they will get a minimum of 1x the deposit and they owe you 1x rent, the value of the items sold needs to exceed 2x the deposit assuming you bring the case yourself in the small claims Court with no legal fees.

The other risk you need to be aware of is that if they use a claims company you are at risk of their legal fees, the tenant will lose a third of the sanctions but the claims companies very rarely negotiate on fees. They know that if they keep writing to you they earn more fees, that is their game. I can help you draft a letter for an early settlement if a claims co becomes involved which may prevent them adding more fees, but you really want to avoid it getting that far.

The page below explains options for negotiating a settlement with a tenant (ideally before a claims co becomes involved).

http://www.propertyinvestmentproject.co.uk/blog/tenant-threatening-legal-action-tenancy-deposit/

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Chuddy 15th April, 2018 @ 17:02

Hi .

I have posted on this site on few occassions.
My Nightmare began In July 2017. We viewed a property to rent with the person who said he was the owner.
The Property was in Desperate need of Repair and Carpets needed Professional Cleaning or Removal.
The 'Owner' blamed all deterioration at the property on the Previous TENNANTS. He told us what he was looking for for Rent he told us £2,500 this Includes £200 per month for Garden Maintainance. I offered less stating that the State of the Property did not warrant what he was asking, he told us that if we wanted the house all Repairs would be completed ,all Carpets would be either removed and replaced with wood flooring. Carpet In the Utility room which has been damaged due to water leaks etc would be replaced with tiling within a 2 week period.
So we agreed we paid £3,500 Deposit and the first months rent of £2,500.
After numerous phone calls and texts none of the Repairs have been done , carpets etc have been left along with numerous other Issues.
The Deposit has not been placed Into a Deposit Protection Scheme, I questioned the ' Owner ' a Specialist Residential Agent.
He Stated he did not have to put it with a Goverment Backed Scheme he had his own Scheme , this was In October 2017.
Due to loosing my Business and being if Bad Health I Informed the 'Owner' at the Beginning of Jan 2018 that I wanted my Deposit returned and would vacate the Property as it was not worth any where near the amount of money we were paying. The Owner said ' Forget It you are getting no Deposit Back'.So I told him that he would have to take me to Court as I was not Prepared to pay anymore Rent for the Property.
It has now transpired he is not the Owner at all. He has been removing Post from my Post Box as he tried to take me to Court at the Beginning of March for Possession of the Property, which I was unaware of due to post going missing. The Court Struck out the Claim , due to him not being the Owner.
He has now Issued another Claim In the Name of the Owner but with his own home address.
Over the past few weeks he has come into the Property on several occassions he has gone through personal belongings, and on Thursday of last week he turned up again and Physically Assaulted my Son , he had to attend hospital and the police have been Involved.
He has not Protected Deposit.I have No EPC or Gas Certificate and have not been given the guide to renting.
I am of the opinion he Is conning the Owner of the Property wJo is a older Gentleman, and that the Owner is not aware of the State of his property and how he is letting it deteriorate
We are due on court on the 20/04/18.

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David 16th April, 2018 @ 00:50

@Chuddy

Yes I remember your posts, I also remember my advice and you contacting me via forum to say that you did Land Registry Search so you have the name of the Landlord but I am not clear if you have their address.

I advised you to formerly request the address of the Landlord and I explained to you that you that you are entitled to withhold rent until it is provided but must then pay it.

Under S48 of the 1987 Landlord & Tenant Act you are entitled to withhold your rent until the address is formerly provided, you needed to request it in writing and they need to reply.

It is actually a Criminal Offence not to provide you with the address under S1 of the 1985 Landlord & Tenant Act.

The Council is the one who would take the matter to Court.

I also advised you that you have a Counter claim worth £10,500.

and most importantly I told you to invest £3 in changing the lock.

I fired off a load of questions to you via the forum which I cannot trace a reply to.

Now you come at me 4 days before Court, it is past the date you can file evidence so you will have to rely on telling the Judge your position.

Because you did not tell me I do not know if you followed my advice.

I suggest that you contact me via the forum.

It does not matter that the Landlord is an elderly man, he is the one who let this person do this and he is responsible, you have to claim against him.

You will be asking the Judge to adjourn the hearing, order that this person provides the Court with full details of the Landlord and orders them to attend the new hearing.

You will make a request to the Court that you be allowed to file evidence for the adjourned hearing as the "agent" has been stealing your post and entering your property as well as harassing you and assaulting your son, you will need a crime number and something from the Police.

Regardless of whether he is Landlord you can have him prosecuted under Protection from Harassment Act 1997,

https://www.legislation.gov.uk/ukpga/1997/40/contents

This is far reaching with many breaches based on what you have said and the assault on your son will allow you to double down.

You did not say whether he is using S8 or S21.

The EPC and How to Rent Booklet, Gas Safety and Deposit Protection are automatic rejection for S21 so I suspect that he is using S8.

So initially, if you made the formal request I suggested and he has not provided the Landlord address then you have your defence for not paying the rent. If he did respond and gave his address, then that becomes the address for serving legal papers.

In Court you can tell the Judge that you have been trying to find the real Landlord, referring to how he brought the previous case in an attempt to deceive the Court. You can explain that he has been stealing your post and harassing you so you have been living in fear and would be grateful if the Court would order him to furnish the Court with the full name and address of the Landlord so you may deal with them moving forward.

Note that the fines in Civil Remedy for the Harassment are much higher than you will expect in

For example I have seen a Landlord who was also Agent bring a bunch of mates around and threaten a tenant then evict him, it cost them in excess of £40,000 plus all the deposit protection etc.

Due to the Gravity of this case I strongly suggest you seek legal representation if you have not already. I can recommend a firm but due to the timing they will need to seek an adjournment. If your financial position is as bad as you say they may do a conditional fee arrangement, especially as the potential payout is so large.

You could attend yourself saying that you have only been recently made aware of the new case and wish to have time to seek professional legal advice.

If this person does not have an agency business that has a business premises, a website or a formal limited company or trading name, you could say to the Court that you felt they were not even an agent or formerly instructed by the Landlord Owner of the property.

You did not say how much in arrears you are? Assuming you did not pay since January you exceed the 2 month limit for mandatory under S8 Ground 8, you could delay the case by paying enough rent to bring it just under 2 months. I would pay that into Court on the day if you have it.

Otherwise you bring your deposit protection claim against the actual Landlord and use the sanction you win, considering the violence it is likely to be a 3x case.

I will send you a copy of this message via the forum.

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Chuddy 18th April, 2018 @ 18:58

Hi.
Further to my post.
I have Contacted the Agent on several occassions asking for the Address of the Landlord.

He keeps sending me his own address.

Furthermore I have never signed any Tennsncy agreement.

You said you would send me details of a legal repeesentative.
I have contacted the Court asking for a adjournment.
I cannot move out of the Property until I receive my Deposit back.

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