Harassment and illegal eviction claim – not yet gone to tribunal?

Hello, I’m a landlord managing a tenancy situation that has gone badly wrong. We’ve been hit with a letter before action and a claim for rent repayment but it’s not been filed for yet. It’s for harassment and illegal eviction by K.

Here’s the background: a few days after moving into a single tenancy style property, K made a formal complaint about another longstanding tenant in the room next door to her, E, who had a history of harassing people which K can document being reported by previous tenants. In our response to K we disputed this fact which I realise looks very bad.

E routinely made bizarre and inflammatory allegations about things K had yet to do or claimed malicious intent which K clearly didn’t have (ie next, K planned to stop E from reading the Bible or praying after K politely asked if E could avoid waking her up between 3:30 and 5:30am by slamming doors as this was a daily issue because of E’s shift work. K is Catholic and so is her partner, so you see how E’s complaints look very odd). K regularly sent us videos of E slamming doors with far more force than necessary, seemingly with the intent of waking her up at these strange hours, which made K very sleep deprived. K also had recordings of E trying to assault her, witness statements and records of other tenants complaining about E’s threatening behaviour sent to us (which I stupidly lied about) and K claimed she had a heart issue exacerbated by E’s conduct that K didn’t mention on her housing application. We’ve dismissed this in our response to her request for confirmation but she did routinely email us about it.

However the complaints on both sides got too much so we told K she could leave before the fourth month of her tenancy or be evicted. We told her this at month three and this forms her claim of harassment and illegal eviction. She said she felt coerced out the property. We even told her, over email, that we were doing this to “avoid being seen as taking sides” which she’s claiming makes this retaliatory.

Big snag: we ignored K’s requests for mediation (E refused, but we warned K of this over email before asking as that’s just what E is like) or alternative dispute resolution, and never updated her at all about a chat we had with E. K asked to be moved kitchens away from her shared one with E but we forgot to respond to this, even though K spent four months asking us. In our correspondence with K after her letter before action, we claimed that we had multiple chats with E. We cannot prove this and K was reasonably under the impression nothing had been done.

When it seemed like E was going anyways, we told K not to worry anymore apologised for the stress, said she could stay and we mistakenly told her we had served a Section 21 notice, but had in fact withdrawn it. She left anyway and this ultimately left her homeless. She claimed she had no trust in us and couldn’t be sure that we wouldn’t do something like this again, but we’ve told her the S21 claim was an “innocent mistake”.

Another snag: in corresponding with K, we’ve accidentally leaked the status of E’s tenancy and K, who previously filed a DSAR that we forgot about and sent back too late, said she wants to contact the ICO.

K has now issued us a letter before action and also council support, so it’s likely she will pursue the claim. She incurred moving costs, experienced stress and disruption, and her self-employment was affected. Her rent was £800 per month and she’s requested that we pay her back 4 months rent, the entire period she was there for. She claims that as E bullied her the entire tenancy (and we claimed that only young professionals lived in the property, when E is in fact 40 years older) and she couldn’t use the communal areas without fear of assault so was paying for a house she couldn’t use.

We are now considering settlement to resolve the dispute quickly, but the situation has raised serious questions about where we went wrong, the impact of ignoring mediation requests and Section 21 rules.

Please help me as I’ve told K I won’t be settling as we never actually served her a S21, we could have stayed, and E raised complaints about her too (albeit ridiculous ones we never told K about at all). K has got evidence for everything she needs, so what seems like a good settlement number if she’s asking for £5k for the RRO and damages?

Thank you,

J