Letting Agent not protected deposit and will not forward me the deposit

by Readers Question

10:51 AM, 12th December 2016
About 3 years ago

Letting Agent not protected deposit and will not forward me the deposit

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Letting Agent not protected deposit and will not forward me the deposit

My old letting agent found tenants for a flat I own in Feb 2015 and at the time was led to believe by the agent that they would protect the deposit. I have spent the last year trying to get proof of this or get the deposit back from the agent with little or response at all. deposit

I have been in to see them on several occasions over the past year and sent at least 6 emails with details, including details of our discussions when I have been to see them (to give me an ongoing written record). In person they are always full of false promise that they will either protect the deposit or return it to me (so that I can protect it as I am required as the Landlord), however they have not once replied my emails regarding this, even though having confirmed verbally that they have received them.

I now believe this is a rogue letting agent, which I will no longer be using, they are still trading as a letting agent.

To make matters worse, my tenants have stopped paying the rent so will need to serve them a section 21 notice over the next couple of weeks. Should I protect the deposit with DPS from my own pocket before I serve notice, even though I haven’t actually received it? My main concern is being able to legally evict the tenants rather than the deposit itself.

What are my options please? The deposit is £650.

Many thanks,

Ryan



Comments

Kate Mellor

20:53 PM, 17th December 2016
About 3 years ago

Reply to the comment left by "Mandy Thomson" at "17/12/2016 - 15:40":

Hi Mandy, it's my understanding that as the tenancy contract is between the landlord and tenant the tenants recourse is therefore against the landlord in the first instance. The tenant has no standing in the Agency Agreement which is between Agent & Landlord only, unless they pursue the Agent under the Rights of Third Parties Act 1999 (which may well be contracted out as indeed it is in an AST). The Agent would certainly be liable for any losses caused to the landlord by the Agents failure to fulfil their contractual obligations under their agency agreement (presuming they had accepted responsibility for protecting the tenants deposit), but it would be incumbent upon the Landlord to sue the agent to recompense his losses.

It is also my understanding that whilst the deposit belongs to the tenant, the Landlord has ultimate responsibility for administering all aspects of the tenancy and the tenants deposit, and the agent is just that, the Landlord's agent, acting on his instructions. Unless the Agent has protected the deposit directly they are required to pay it to the Landlord to enable him to protect it himself. If the agent doesn't repay it in time the landlord must still make a deposit on behalf of the tenant to comply with the 30 day time limit. This means that the money held by the agent would then belong to the landlord as the landlord has paid his own funds into the deposit scheme. By this logic, in the event that the landlord has returned the tenants deposit to the tenant, then the agent is liable to repay the money held to the landlord.

I would be more than happy to admit it if I'm wrong and I'd be keen to read any articles you can point me towards which might show me where I've gone wrong The last thing I want to do is give out incorrect advice to others, but I can't find anything online about tenants suing agents directly.

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