Didn’t protect deposit and tenant turned nasty taking us to court for 6 times deposit!

Didn’t protect deposit and tenant turned nasty taking us to court for 6 times deposit!

9:10 AM, 8th October 2015, About 9 years ago 25

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My husband and I have a converted garage annex flat on side of our property and we rented it out in November 2014, we advertised over Gumtree and a couple offered us £850 rent and they gave us £850 deposit. We held the deposit in a separate account which was only used for the deposit and rent. I had rented a flat many years ago and I just did the same this time. We just didn’t know anything about the DPS. we were just were not clued up enough. This was a side income that helped pay the bills while I was off work with our baby. The couple were lovely, shared our garden and everyone was happy.nasty

The 6months tenancy finished in May 15 and the couple really wanted a new year long contract. We agreed and did another tenancy agreement with them. Once this was signed everything changed, he began operating a builders business from this small annex flat, they dumped building rubbish and things in and around the property, mixers, concrete, rubble.

They became noisy, dirty and wanted to build outside. We sent them an email asking them to abide by the tenancy agreement and if they could not, we were happy for them to give us notice.

In August they gave us 1 months notice which we accepted. We found another tenant to move in earlier which worked for everyone. There were a few things that needed doing, carpets cleaning, plastering bits, repainting because of the mess they made. They said they would do it but in the end they didn’t. So we got the work done, agreed everything with them, agreed any costs before taking from their deposit. We then provided all receipts and we paid them back £450 of their £850. We did the check out inventories, gave them receipts for everything, doing check out correctly.

Our new tenant asked if his deposit would be held in an escrow account which started me looking online and we realised then that we should have done this before and that we needed to use a DPS scheme now which we promptly did for the new tenant.

We didn’t think much more about it, but today we received a letter from a solicitor (I think its a no win no fee company). The first tenants are taking us to court for not holding the deposit in a DPS. They solicitors are demanding £5,100. They say the tenants are owed 3 x £850 for the first tenancy (6 months) and a further 3 x £850 for the year long tenancy agreement. Although we did not take any additional deposit.

Now having read and read forum articles and information we know that they can take us to court and the court can slap a penalty of between 1x – 3x the £850 deposit. But would they do that on the rolled over second tenancy agreement? I don’t think the tenants even have any of the tenancy agreements as they dumped them in the bin when they left, does that help our case? Should we see a solicitor asap?

Can you help us at all? We know ignorance isn’t a factor that the law takes into account!! but what can we do now to hope for minimal damage to us?

We are in a bit of a state, this is so much money for us

They have phoned us early hours of the morning, laughing and jeering and sent us texts and come back in their van and dumped building rubbish outside our house.

Thanks in advance

Laura


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Comments

White Collar

17:20 PM, 8th October 2015, About 9 years ago

You only have a requirement to protect a deposit if the tenancy is a 'shorthold tenancy' which for the purposes of the Housing Act 2004 means an assured shorthold tenancy within the meaning of Chapter 2 of Part 1 of the Housing Act 1988.

From the information above, this appears not a shorthold tenancy and so there was no need to protect the deposit.

Happy to assist with the legal advice and assistance further.

20:17 PM, 8th October 2015, About 9 years ago

The Deposit Penalties are Per Deposit, NOT per tenancy.
If the most money you ever received as a deposit was £850, your worst liability is 3 x £850.
Court Deposit prosecutions have shown a tendancy to fine 'First-time' novice landlords Once x the Deposit.
By all means get a consultation with a solicitor, but also take some responsibility for launching yourself into the property business without joining one of the Landlord associations and getting advice. That said, best of luck.
Chris

Romain Garcin

20:26 PM, 8th October 2015, About 9 years ago

Reply to the comment left by "Chris Daniel" at "08/10/2015 - 20:17":

"The Deposit Penalties are Per Deposit, NOT per tenancy."

It is indeed per tenancy in the law. A deposit is linked to a specific tenancy and the whole deposit protection law kicks in every time a new tenancy is created (which caused a bit of an issue in the Superstrike case).

However, here there is an argument that the deposit did not require to be protected at all.

Neil Robb

22:15 PM, 8th October 2015, About 9 years ago

I would go with the we are live in landlords and it was never described as an AST.

At the end of the day the tenant will have to come up with tenancy agreement for their solicitor.

I had one and they kept sending emails demanding money. Make no mistake I was worried until I looked at the tenancy agreement and it said no deposit was taken. But they tried all sorts to get money from me.
Just goes to show how people you think are decent only turn out to be dishonest.
Plus at the start of there agreement there was no need to protect deposits.

Don't ignore this but be careful anything you say or text. That it wont come back on you.

National Landlords Association cost about £80 a year you get all the documents you need and free advice.

Jay James

22:32 PM, 8th October 2015, About 9 years ago

Hi Laura

I believe it has been said on this site that whatever documents and people might say, it is the underlying reality that determines whether or not a tenancy exists and what type of tenancy.

Thus referring to a resident landlord situation as an AST, does not prejudice you (when in front of a judge). However, this does not stop a solicitor and their client trying it on. As suggested, perhaps you could treat the trying it on as both criminal and civil harassment.

If I'm wrong anyone, please correct me.

Bill Morgan

2:18 AM, 9th October 2015, About 9 years ago

What happens if you have protected the deposit but you did it late.

Will that prevent the granting of a section 21 notice

Paul Franklin

9:57 AM, 9th October 2015, About 9 years ago

The deposit regs does not apply to excluded occupiers. If you are a resident landlord the tenant will not be tenants, they will be excluded occupiers.
A resident landlord is where under the terms, the occupier shares any accommodation with the landlord.

The shared garden could therefore be imporatant (unless there is any other part of the accommodation that you shared?). If the shared garden qualifies as sharing 'accommodation' you could potentially have a case to claim you are a resident landlord and they are excluded occupiers? May be worth taking advice on that.

AlanR

10:27 AM, 9th October 2015, About 9 years ago

If the actual tenancy agreement that was signed by all parties was an AST format then surely it was legally an AST, regardless of the annexe/family house situation?? I don't know, I'm not knowledgeable in these matters, just kind of seems logical...

Anyway your solicitor will be able to advise you on that. Good luck Laura...hope it all works out in your favour.

money manager

18:01 PM, 2nd November 2015, About 9 years ago

I don't think this is an excluded occupier tenancy and nor do I think you have to rely on the garden being the shared accomodation. It sound like a non assured tenancy agreement which can apply in one of three situations one being specifically where a resident landlord in their main or only home DOES NOT share accomodation with the tenant. No deposit protection required either. Perhaps a call to the solicitor, or better a letter suggesting that he advises his client to desist in their actions as they could lead to a criminal charge of harrasement and possibly demanding money with menaces. He might get the message.

20:23 PM, 2nd November 2015, About 9 years ago

Laura if you want some help - contact detail on my profile.

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