No deposit protection as helping out friends!

by Readers Question

11:52 AM, 6th March 2015
About 4 years ago

No deposit protection as helping out friends!

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No deposit protection as helping out friends!

I am beginning to realise I was very foolish. I allowed a family who I was friends with to let my property way under the market value. We drafted a contract so that their children could be accepted at the local school.

It was agreed by both sides that the deposit did not need to go in to a deposit protection scheme and it was written into the contract that it would be deducted from the final rent payment.

Unfortunately I had to serve notice as needed to sell and this was when problems occurred. We gave 3 months notice and they refused to pay any further rent.

We have stuck to the law with all the other requirements but was nieve with the deposit. Just wanted to help out another family that were about to be homeless and save agents costs so we could give them lower rent.

They are due to leave very soon and have said they want their deposit back but as they have refused to pay rent and they have forgotten that we put in the contract that it would come off last month’s rent once they vacate where do they stand legally.

They broke a number of terms in their tenancy, sold items listed on inventory, damaged to property, undisclosed pets, redecorated to a poor finish without permission, they received £500 rent reduction in return for two jobs they were to carry out. One year on and they are still not done. I even allowed them to move in earlier than planned and gain entry weeks before their tenancy began so they could store items.

Their £1200 deposit is nothing compared to the £3000 that I am aware of that they will owe, it of course could be substantially more as there is a lot of contents.

I have since been scared about the deposit advice I have been given. If I get them out where do I stand legally. My loss is far greater than theirs would it be possible if they decided to pursue me that a court would rule in my favour.

Alicefriends



Comments

Neil Patterson

12:00 PM, 6th March 2015
About 4 years ago

Hi Alice,

I do feel for you and understand the desire to help friends out.

Unfortunately this is a common recurring thread on property118 and if we can use this to highlight once again how careful landlords have to be to protect themselves even when they are helping people it is important.

You haven't protected the deposit so regardless of the rights or wrongs the law is on the tenants side.

The moral of the story, and the others, is that when you are dealing with people, their money and the roof over their heads no matter how well you know them (even family) a lot of people when the chips are down will look after themselves.

You may just have to bit your lip and your pride to avoid them considering suing you for 3 times the deposit plus the deposit.

Emerald Legal

12:11 PM, 6th March 2015
About 4 years ago

Hi Alice,

I agree, unfortunately.

Best to cut your losses, return the deposit and write off what they owe.

Chances are, if you did otherwise, they would issue proceedings for the return of the deposit and between one and three times that amount as compensation.

Having said that, if you do return the deposit and they decide to go down that route in any case, it will help your cause if you have returned it and you will also have a substantial counterclaim to put in!

Good luck

Robert Rivers

12:47 PM, 6th March 2015
About 4 years ago

Obviously the comments above are correct in terms of attempting to make the most of a bad situation and assuming moral high ground, but would a threat to sue them for all the reasons stated (assuming all evidence available), not make them think twice about their threat, which is possibly just a case of trying it on and if they are particularly blinkered people, may still persue the deposit matter, even if returned.

sajed khan

12:54 PM, 6th March 2015
About 4 years ago

Hi Alice,

Sorry to hear about your troubles, i really do feel your pain as I have been in a similar predictament with one of my tenants.
I ended up paying them their deposit plus 3 x as they were taking me to court. My solicitor advice pay them and agree a move out date, otherwise if went to court they would have stayed in the property without paying rent which could have cost alot more and the stress!

Your intentions were right and you were only trying to help another human being, but moral of the story no matter how nice tenants are, treat each tenancy as a business transaction and keep your distance! But we learn from our mistakes and take the experiences with us in order to avoid situations like these occuring again!

Emerald Legal

12:59 PM, 6th March 2015
About 4 years ago

Possibly, Robert. May be risky to aggravate the situation with a potential £2,400 - £4,800 liability though!

Harlequin Garden

13:21 PM, 6th March 2015
About 4 years ago

I will now show my complete lack of understanding with deposits - if it is in the contract that this is the last month's rent - is this not, then, rent in advance? this was the response I was expecting to read.

Mandy Thomson

13:40 PM, 6th March 2015
About 4 years ago

Reply to the comment left by "Neil Patterson" at "06/03/2015 - 12:00":

"The moral of the story, and the others, is that when you are dealing with people, their money and the roof over their heads no matter how well you know them (even family) a lot of people when the chips are down will look after themselves.The moral of the story, and the others, is that when you are dealing with people, their money and the roof over their heads no matter how well you know them (even family) a lot of people when the chips are down will look after themselves."

Really well said - letting to firiends = trouble - whether it's a whole house or your box room for 6 months!

Emerald Legal

13:40 PM, 6th March 2015
About 4 years ago

Hard to say without reading the contract - does the contract stipulate that it is to be used towards rent only and nothing else? If so and you don't demand the rent for the final month you could be ok but one of those tricky issues you would really need to seek proper legal advice

Alice Ambrose

14:50 PM, 6th March 2015
About 4 years ago

Sorry couldn't reply earlier.

Okay so I don't have the deposit money to give them back as well, 3 months rent arrears I don't have any income to pay it back to them. They literally 5 days after I gave birth when rent was due refused to pay another penny. Their rent pays my mortgage etc there and my living costs where I am now.

The contract stated that the deposit can be deducted from the final rent. I can type the exact wording from the contract but the contract was one that has come from a major estate agent as it is a mirror image of our contract but we just edited the deposit area.

I have been left living on just child benefit with two young children that aren't cheap when it comes to formula and nappies, and have been unable to pay for anything due to the refusal of paying rent. I can't afford a solicitor. They are due to leave end of month and I don't want to rock the boat until they are out as I did read that without using the scheme it is harder to get them out. I have had to borrow the mortgage payment money for that property!!

There is a messaging trail that can show their complete refusal to pay another penny as they are angry that they can't stay there. And they have refused 3 months rent from notice and they are saving for a deposit elsewhere, but they are going to stay at his aunt's house. They have had 2 x 6 month contracts. They are leaving after 50 weeks I think it is.

They have made false allegations/threats, my mortgage has consent to let and I have British Gas insurance so of course have a safety certificate they were there when BG came out, they have tried saying I have neither, someone has given them dud advice but other than saying the deposit was illegal, even though this was agreed by both sides, that is all they have said.

I am hoping that I can have enough info that if they kick up a stink once they are out I can say, you breached all these conditions listed, but if you want to go to court then I will counter claim against you. They have posted threats on Facebook after they had to clean the house for the estate agent to come round. The house was immaculate when they moved in, 2 month old carpets, all freshly papered and painted walls and it is disgusting now, the furniture that was expensive is heavily damaged and they have sold 3 items that I am aware and cut supply cables into the property without consent.

I even thought as money is an issue the sheer embarrassment of being dragged on to somewhere like Judge Rinder might be enough to get them to back of. I don't care about the rent or damage anymore I just want my house back with them not being able to get their deposit back. What I am owed far outweighs this.

Gary Nock

14:57 PM, 6th March 2015
About 4 years ago

Reply to the comment left by "Harlequin Garden" at "06/03/2015 - 13:21":

Harlequin it's a deposit. As stated in the opening statement from Alice. And the Judge would see it as a deposit. If they know their rights on this then they have all the cards. Try and come to as amicable a settlement as you can without going to Court. Of course you can work out the worst case scenario of you paying 3 times an unprotected deposit against the unpaid rent and damage claim. But to prove the damage claim you would need to satisfy the Judge -and that means a good inventory. And I don't mean a 4 page list of contents with no photos. A decent inventory for a two bed unfurnished house with photos can run to 70 + pages if done on the proper software. And then theres the preparation of court papers etc for a hearing.

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