Deposit Protection compulsory for sublet?

by Readers Question

11:14 AM, 28th September 2016
About 2 years ago

Deposit Protection compulsory for sublet?

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Deposit Protection compulsory for sublet?

I recently sublet from a tenant with the consent of the landlord and sublet contract. A £1300 deposit was paid direct to tenant on request of the landlord.deposit

Following moving out of the property a scrape on the wooden floor was noticed.

The landlord has asked tenant to withhold entire deposit to pay for scrape.

Cost of repair is quoted as £100, however landlord wants to replace entire floor.

Is an unprotected deposit an issue for the landlord?

Is there any option for me as a sublet tenant to object before going to Small Claims Court?

Thanks, Simon



Comments

Charles King - Barrister-At-Law

12:22 PM, 28th September 2016
About 2 years ago

Did you have a written agreement with anybody Simon? If this was a genuine sub-let you would have had a tenancy granted to you by the tenant. The tenancy the tenant granted to you would normally be an assured shorthold tenancy. The tenant would become your landlord. Did you pay monthly rent, and to whom did you pay it? If you paid it to the landlord the situation is more likely to be an assignment, or simply a new tenancy between you and the original landlord. In this scenario the original tenant is likely to be holding the deposit on behalf of the landlord, as the landlord's agent. If nobody protected your deposit you are entitled to claim the recovery of the deposit, PLUS a penalty of at least one, and possibly 3 times the deposit. From the sounds of it you may be able to make the claim against the landlord, the tenant, or both. It sounds as though they have been rather silly. You have a potential claim of £5,200. Have you not left the property it would have been very difficult for the landlord /tenant to evict you. You need some advice, perhaps from the CAB or Shelter. Best of luck...

Ian Narbeth

12:30 PM, 28th September 2016
About 2 years ago

It is for the tenant, your landlord, to protect the deposit. If he has not done so he, not the head landlord, is liable.

If the tenant has not protected your deposit, say that you have a claim for up to 3 times the amount of the deposit and will set that off against any claim for damage. Tell him not to release any money to the head landlord. Tell him that you dispute the claim and that replacement of the floor is not your responsibility.

Stevenjswan@hotmail.com

22:06 PM, 28th September 2016
About 2 years ago

Reply to the comment left by "Charles King - Barrister-At-Law" at "28/09/2016 - 12:22":

Thank you both, this is incredibly helpful.
For clarification, yes I have a sublet agreement direct with the tenant. The property was sublet for a period of 2 months, paying the 2 months rent, together with an additional security deposit (equal to 1 months rent).
The sublet agreement was approved by the lead landlord and discussed on a 3-way with subtenant, tenant and lead landlord prior to moving in.

Puzzler

8:53 AM, 1st October 2016
About 2 years ago

I don't think you're liable for a new floor, you can argue wear and tear or a small token towards the damage. Hold out, dispute the amount with the protection service. If it wasn't protected then take appropriate action.

David Sweeney

17:26 PM, 1st October 2016
About 2 years ago

Assuming you rented the whole property from the tenant (actually your landlord) and did not share it with him/her then an assured shorthold tenancy was created (no matter what the paperwork says) and your landlord was obliged to protect the deposit. The only possible exception to this is if your tenancy document described the tenancy as an "assured" one, as opposed to an "assured shorthold". This is HUGELY unlikely, particularly with the landlord / superior landlord arrangements you have described.

As has already been mentioned (and you will have seen elsewhere) and unprotected deposit on an AST exposes the landlord to an extremely large penalty, payable to you, though the exact amount is at the discretion of the judge. However, it is not a 'small claims' matter, it should be dealt with in the 'grown up court' and that can be expensive for the claimant (though he would most likely ultimately claim all the costs from the landlord).

Don't let this put you off though . . . How about mentioning the legal situation to the landlord - no way is he entitled to £1300 for a £100 damage and can he even prove the scratch wasn't there when you moved in? If you took it to court as above, you would get most (if not all) of your £1300 pounds back, plus at least £1300 penalty (probably over £2k in my eyes) plus your solicitors costs and court fees - say £5k in total.

A lower financial risk, but with the risk of lower repayment, is to sue for the £1300 deposit through the small claims. In your claim, you would ask the judge to award the penalty of up to £3900 plus the deposit and court fees (no solicitor) BUT he has no obligation to award any penalty - anecdotally, many do.

Taking all this on board, maybe your first approach should be your full deposit back x 2 as that is should be less than your landlord will have to pay if you take it to court and will be much easier for you.

Stevenjswan@hotmail.com

11:01 AM, 8th November 2016
About 2 years ago

Thanks all. This is was settled last week. My tenant landlord was just the guy caught in the middle, but it had taken 3+ months to get deposit back, so I asked for deposit return plus 1 x penalty less £150 for floor repair which he accepted.


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