Case law on charging for rent arrears?

by Readers Question

17:26 PM, 18th December 2013
About 7 years ago

Case law on charging for rent arrears?

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Case law on charging for rent arrears?

Landlord and Tenant Case Law Rent Arrears ChargesOver the last few years I have taken both tenants and their guarantors to court for both possession of my property and for outstanding rent arrears and additional charges.

Over time my tenancy agreements have been modified to take account of the wheezes and get out attempts of the wayward tenants legal boffin’s.

Time moves on and I am slowly coming to the realisation that the courts are totally inconsistent in their approach to my claims and so that probably means yours as well.

In an attempt to prevent things getting out of hand with a tenants arrears, I issue on a set cycle with trigger points starting with a free rent reminder, then a chargeable reminder, then a referral to a UK Licensed Debt Collector, then a Section 8 notice, then a Court Hearing, then a Bailiff if required.

My beef is with some judges who will allow me to pass over the additional costs to my claim for outstanding rent as they are written into my tenancy agreement and some who wont. Some don’t like PCOL (Possession Claim on Line) being used for anything other than rent arrears and have suggested that the manual forms are filled in at an additional cost over and above what the PCOL system charges. Some judges have given me leave to alter a ‘particular of claim’ at the actual hearing and others giving me 14 days. Some judges allow me a judgement against a guarantor at the same hearing and some who argue that it should be a separate case, (until I flash a couple of previous judgements under their noses showing the guarantors got a judgement from their other colleagues), at the same court.

I would like to offset any charges I have incurred against the tenants rent that has already been paid, so that I can bring a case that then only refers to rent arrears.

For example: is it possible to offset any charges allowed in my tenancy agreement, (and deemed not to be unfair), against rent that has already been paid?

Supposing a tenant has previously paid £4,000 in rent, but now owes £1,000 in overdue rent and I get an invoice from my Debt Collector of £150, can I deduct this cost from my tenants PAID rental account total which would now mean my tenant owes £1,150 in overdue rent?

My debt collector says yes, some say no, some judges say yes and some say no….but I’ll give you 14 days in which to change your particulars of claim….”Aaargh” its so frustrating! That then would mean that as a section 8 notice can only be used for rent arrears and claim costs that a separate legal case would be required, which is slow, takes twice as long and is twice as expensive to navigate. Alternatively, is it the case that the date of a transaction has to remain its true account history?

Anyway despite how bad it looks from what I have written, these experiences are over many years, but my question is this…..

Is anyone out there in property118.com land, who has a case law example where this matter can be put to rest without some judges having to give me a hard time and others letting the claim go through without any questions?

I would appreciate your thoughs

Thanks

Gary

Comments

Andrew Miller

18:06 PM, 18th December 2013
About 7 years ago

Inconsistencies between different District Judges are a real problem. The problem is unresovable because the appeals mechanism is too cumbersome and expensive

As a matter of course we issue sec 8 against Tenants for rent arrears only. We do this because they are still in occupation and we are not in a position to finalise any damages claim until they have vacated. So we have to issue twice to secure recovery of damages any way.

When vacated we do a full damages and charges check and then sue the guarantor independently including of course any costs awarded on the sec 8 court case.

I have associates who do join guarantors in on the sec 8 as a co defendant but i don't think this is wise. Guarantors are more likely to get involved and fund a defence that could become complex by a counter claim for damages for disrepair.You might not your house back for months!! Additionally you are going to have to issue separate proceedings after they have left any way for any damages

Divide and rule. Sue tenants and guarantors separately

Mark Alexander

19:05 PM, 18th December 2013
About 7 years ago

Interesting Twitter responses from Anthony Gold solicitors

Romain Garcin

22:51 PM, 18th December 2013
About 7 years ago

I don't see why you hire a debt collector in such cases, but that's another issue.

As said, the £150 fee is not rent so is not recoverable through s.8 proceedings based on rent arrears. If you argue that tenant is liable to pay this fee then you need to go the money claim route.

Gary Dully

23:28 PM, 18th December 2013
About 7 years ago

Reply to the comment left by "Andrew Miller" at "18/12/2013 - 18:06":

Thanks for your comment(s), Mark, Andrew and Nearly Legal perhaps I should put a looming problem down as an example.

So see how you would navigate this, as you say other associates have a similar approach that may differ yours.

2 tenants, (1 male, 1 female) moved into a 5 person HMO 3 months ago, have an argument and the male tenant pushes his fist at high speed into her face for the pleasure. But they also have started to run up some rent arrears.

The female abandons her tenancy and goes to live with mum.

The male tenant nor the female actually lodge a complaint, but another female house mate, fearing for her safety, in the HMO does, .

I issue a section 8 for grounds 10, 11, 12 and 13 for rent arrears and breaches of tenancy as the complainant is insisting that I do something about the remaining tenant.

I cant use grounds 14 because I don't have a crime number.

Upon receipt of his section 8 notice, the male tenant does a runner as well, but changes the security code on his entrance door out of spite, so I cant gain entry and no property keys are returned. I have no legal right to be told of their new code, except to know that its going to get expensive.

I have written to the guarantor and female tenant who have ignored my requests for assistance.
The battered tenant has gone back living with her boyfriend, but I cant find out where, (Yet!).

An abandonment notice has been issued as well as the Section 8.

Both items are listed in the tenancy agreement as chargeable events, as is replacing doors and locks, but only if the Police do the breaking down of the door.

The section 8 notice becomes usable after 25th December, 2013, and at that point I have to decide whether to use PCOL, (Possession Claim Online),or the manual forms that allow also abandonment etc., but I have to pay a higher court fee.

I also know that without a security code being divulged the entrance door will have to be smashed open to gain entry, which will then require a door frame, new fire door, definitely a new digital lock and a change of all external locks for the existing house mates.(Cost approx £400)

I could smash the door down tomorrow, but I'm not that stupid as to fall for that trap.

My normal reaction would be to get on with it, by gaining emergency access as a landlord, (All chargeable under our tenancy agreement).

But come the day of my court application, I will have grounds 8 available, but not on my section 8, which was initially triggered by a written complaint from another house mate.

So my questions are Mark, Andrew and Nearly Legal, how would you proceed?

Firstly PCOL is only designed for rent arrears, other grounds being entered into that computer system is like trying to push a rope. - Would you agree?

Next, my tenancy agreement lists charges that would be triggered by certain events which the tenants have indeed triggered and in my view should be chargeable against the balance of any monies paid already, leaving just outstanding rent arrears, for the court to handle.

I don't mind the judge fiddling with the figures at the hearing, that's called a judgement.

Bear in mind that there is a guarantor, who has guaranteed the two tenants will not breach their tenancy

The point of this question is to get me through the God Damn Court application form or PCOL, without having multiple court cases, if at all possible.

I have gone down the route of separate cases before and a guarantor actually used a defence of me bringing a "Vexatious claim" that should have been brought at the time of the case against the original tenant, who we couldn't trace and the judge agreed.

Since that day I stick everyone on the one and only claim form, I normally make.
but its quite stressful being shouted at by some judges and others have said, "so long as that guarantors name was on that claim form I will make a judgement."
So I just don't know what to do with this one really.

As for the comment of lawyers persuading judges not to get it wrong, isn't the idea of the small claims service, I thought it was designed to preclude lawyers and keep costs down, so that they could get on with dealing with murderers and fraudsters instead.

What do you think and why?
Ps. Thank you for your time.

Mark Alexander

10:01 AM, 19th December 2013
About 7 years ago

Reply to the comment left by "Gary Dully" at "18/12/2013 - 23:28":

Hi Gary

I have never had this problem.

However, my starting point would be a call to the guarantor and preferably arrange a meeting over a cuppa to explain the situation and their liability. You might just find they sort the problem for you when they realise they will cop for all these costs if they can't get them sorted for you.

I would probably deal with the possession and the claim against the guarantor separately.

Have a look at this readers questions article and my response, it may save you a lot of money in terms of dealing with the debt collection aspect of your problem >>> http://www.property118.com/good-debt-recovery-agent/44679/
.

Andrew Miller

17:31 PM, 19th December 2013
About 7 years ago

Gary thats one hell off a problem

but to keep it simple i would go for sec 8 possession rent arrears only against the tenant.

as soon as i had secure vacant possession i would then do a full damages check and sue the guarantor for all costs including the judgement you have obtained against the tenant.That will include the £175 court costs.

i don't bother suing tenants for monetary values save of course for arrears on the sec 8 trigger . whats the point they have few if any assets

we only let to tenants who have home owner guarantors and when we have secured a judgement against them proceed to obtain and register a charge against their home. At long last CCJ's mean something and we often eventually secure full recovery from guarantors who have something to loose i.e. an inability to secure future credit.

Karen Archer

7:02 AM, 25th June 2014
About 7 years ago

I was reading that the landlord had to serve a Section 17 notice to the guarantor within 6 months of the debt but cannot find this form anywhere. Just going through the court process to get possession order, although tenant has moved and is refusing to surrender keys or tenancy


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