Letting agent didn’t serve prescribed information for deposit protection?

Letting agent didn’t serve prescribed information for deposit protection?

8:45 AM, 16th May 2022, About 3 months ago 6

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Hi everyone, My letting agent didn’t serve the tenants the prescribed information for their deposit protection. This was for a number of properties of mine.

I am obviously now in the process of de-instructing them.

But what can I do to make all existing tenancies compliant?

Can I ask the tenants to sign a new AST with prescribed information?

Can I hold the letting agent responsible for any issues or fines further down the line?

Many Thanks

Mike



Comments

Nigel Parry View Profile

9:31 AM, 16th May 2022, About 3 months ago

Mike, whilst I do not want to be the bearer of bad news; the short answer is you cannot 'make them compliant'. The timescale for deposit registration, serving information is finite.
You may be able to mitigate any future issues. By signing a new AST and serving new info you may be able to reset the clock on a new tenancy but it will not eliminate the old tenancy issues (the 5 year rule may apply here). The real issue you have is that by doing something (anything) you may give the tenants a heads up that there is an issue and with all the ambulance chasers out there, it could be costly.

That said, serving the correct prescribed information on the tenants at this stage, under the guise of a new 'version' of the scheme rules may help, but it will not eliminate the Section 21 issue of not being able to serve it. It is one of those calculated risk scenarios I'm afraid.

Another option is to return the deposits in full to all tenants, and hope they don't take you to court for three times the deposit, but at least you will get the Section 21 option back.

As far as the Agent is concerned, you have several things you can do; report them to their ombudsman, ask for their PI insurer's details and put the insurers on notice, ask them to refund costs and extra payment for the anguish you are now facing and advise them of their liability. Incidentally if any tenant does take you for three times the deposit, you can then relay the costs to the Agent vis a subsequent court action if needed, but they need to be trading!
Hope that helps. Reach out if you need anything else.

Annie Landlord

9:38 AM, 16th May 2022, About 3 months ago

Hi Nigel, what is the '5 year rule'?
Thanks

David

10:13 AM, 16th May 2022, About 3 months ago

It's 6 years and it's the statute of limitations. I would gather as much evidence as possible of the agents failure to perform the contract as you may need to sue them if the tenants claim a penalty against you.

Nigel Parry View Profile

10:45 AM, 16th May 2022, About 3 months ago

Reply to the comment left by David at 16/05/2022 - 10:13
There is no statute of limitations in England and Wales. Its an American thing. The general rule is, as you say 6 years for a 'Tort' of breach of contract. Typo on my part.

Alan Hill

16:10 PM, 16th May 2022, About 3 months ago

This article is really useful to show some different scenarios with failing to protect deposits or issue prescribed information:

https://www.propertyinvestmentproject.co.uk/blog/i-havent-protected-my-tenants-deposit/

You can see they show you the possible risks of each strategy. Hope it helps!

DSR

16:31 PM, 16th May 2022, About 3 months ago

Reply to the comment left by Nigel Parry at 16/05/2022 - 10:45
to follow up on this then (so its clear in my head) if you didn't protect a deposit say in 2016, but then agree a new AST at which point you do serve the PI properly, if you later when down the S21 route for this new AST then there is no way the tenant could argue (claim for) about the previous deposit in a previous AST not being protected earlier back in 2016?

Is that correct?

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