Agent going under twice – deposit and rent missing!

by Readers Question

12:52 PM, 4th October 2017
About A year ago

Agent going under twice – deposit and rent missing!

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Agent going under twice – deposit and rent missing!

Hi, an estate agent who has been managing my property over the last 8 years has stopped paying me my rent. The original company was dissolved in August, but the director set up another company over a year ago called the same with a slight different twist on the name.

It is the new company that has sent me my receipts for the last year or so, but the old company who was taking my rent. Now the new company is also filing to be dissolved.

However, I am still owed rent, and my tenant is owed their deposit, not to mention tenancy agreements and keys etc, but no one from the company is available.

I suspect the director used the original company to run up debts, and the newer company to build up assets, so that when the old company went under it wrote the debts off, leaving him able to tie up the new company and take the money.

So I don’t know what I can do, or where I stand with my tenant and their deposit etc? They were never given any evidence of it being registered with a deposit scheme as they should have been.

Many thanks

Wayne



Comments

Neil Patterson

12:57 PM, 4th October 2017
About A year ago

Hi Wayne,

In the event the agent belongs to a redress scheme report it to them immediately and see if they have client money protection insurance.

Also Mark Smith (Barrister-at-Law) has had success for a previous group of Property118 readers in a case against an agent, but it was settled out of court.

It depends on if there is any money to be recovered, but it may be worth contacting Mark on our Private Prosecutions page see >> https://www.property118.com/private-prosecutions/

Especially if there are a group of you.

Please also see another similarly unfortunate article >> https://www.property118.com/letting-agent-gone-bust-ilford/

Mark Crampton Smith

14:30 PM, 4th October 2017
About A year ago

Sadly Wayne, it will be you that owes the tenant their deposit. I would find out which scheme the deposit was protected by, (will be in the tenancy agreement) and let them know as soon as possible too. It will also be worth contacting the local trading standards team, as they might well have other clients who have been in touch and might agree to forward an email from you to others in order that you could work together towards resolution.

Kate Mellor

15:36 PM, 4th October 2017
About A year ago

You can object to a company being dissolved and prevent them from doing so if they are in debt to you. That's why it's advertised in the gazette before hand.

Bill O'Dell

17:30 PM, 4th October 2017
About A year ago

If as you suggest there is an element of fraud involved, I would certainly contact the liquidator or companies house and prevent the dissolution until the former directors personal assets are reviewed and added to the dissolution. Fraud is not protected by a having a limited company - there are many events that make a Director personally liable for their conduct. It sounds like this may be one of them

Wayne Hefford

17:54 PM, 4th October 2017
About A year ago

Reply to the comment left by Kate Mellor at 04/10/2017 - 15:36
Thanks Kate, I have written to Companies House and objected to the company being dissolved. However, they have asked for proof that I am actively chasing the company up. For which I sent them the email trail of requests for rent and scanned receipts showing the different letter head of each company - however, they said that this wasn't enough evidence, and as I can't now get hold of anyone from the company, I don't know what more I can get?!

Michael Holmes

20:39 PM, 4th October 2017
About A year ago

Reply to the comment left by Wayne Hefford at 04/10/2017 - 17:54
It seems to me that Companies House is trying to pass the buck, it might be worthwhile employing a legal eagle to write to them or maybe somebody in the Landlords Union might like to advise.

Wayne Hefford

10:09 AM, 5th October 2017
About A year ago

Reply to the comment left by Michael Holmes at 04/10/2017 - 20:39
Thanks Michael, I have contacted a couple of solicitors but they want to charge me £100 just for an initial consultation, where as if there is nothing that can be done then I'm at an even greater loss. So mainly what I am after is some advice as to whether there is in fact anything that can be done, CAB advised the same as above to contact companies house, they said I don't have enough evidence and to contact the Insolvency Services, who have also said that they can't help.
I can deal with losing the rent that's owed me, but my main concern is for the tenants deposit (who has since advised me that they weren't even given a tenancy agreement) and to get the keys ect.

Rob Crawford

12:45 PM, 5th October 2017
About A year ago

Sorry to hear this Wayne, hopefully you have diverted future rent payments into your account. Most solicitors offer an initial free consultation but as this claim may get a bit messy I would be seeking to employ one asap. Hopefully the agent has protected the deposit otherwise there will be other implications against you etc. Good luck and please keep us informed.

Kate Mellor

23:08 PM, 11th October 2017
About A year ago

Ask them what they would accept. It may be that they expect you to have started a legal pursuit. This is easy enough to do via the MCOL (Money Claim Online) process. https://www.gov.uk/make-money-claim-online The fees vary depending how much you are claiming. https://www.gov.uk/make-court-claim-for-money/court-fees
It's a pretty straightforward process. Obviously you may end up throwing good money after bad, as the company is unlikely to be in funds and sadly no one seems to be interested in prosecuting these corporate criminals.


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