My Deposits ruling – No wonder landlords are selling up?
Yet another reason to sell up. My deposits have just ruled that unless a landlord has a court order they cannot be awarded money from a deposit to pay towards legal costs!
My Deposits has awarded in favour of my ex-tenants by giving their money back even though they withheld rent twice over 2 years, were in arrears and I had to get legal advice and help to get them to pay and eventually evict them.
I had claimed these costs from their deposit but was not allowed to keep the money.
I am bringing the ruling from MyDeposits to the attention of fellow landlords as a warning.
I have since sold the property and plan on selling more as the tenancies expire.
Zeph
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Member Since June 2018 - Comments: 5
3:54 PM, 15th February 2023, About 3 years ago
Here is the copy of the MyDeposits ruling:
Adjudicator’s findings:
The solicitor’s bills provided show the work carried out for the recovery of rent from the tenant, for £xxxxxx. While a landlord can choose to employ a solicitor and costs are shown to have been incurred, without a court order confirming that the tenant is responsible for such costs, I am unable to award any legal fees. Under the Tenant Fee Act 2019, Landlords,agents and tenants are generally responsible for their own legal costs resulting from a dispute of the tenancy agreement.
Award to member: £0.00
Dated 15 February 2023 mydeposits appointed adjudicator
Member Since November 2013 - Comments: 7
4:08 PM, 15th February 2023, About 3 years ago
this is another reason why there’s no point collecting a deposit.Loads of hassle, many trip hazards and it probably will not pay up. Better to be picky which tenant to go for and consider a guarantor
6:09 PM, 15th February 2023, About 3 years ago
If you sued your tenant it would almost certainly be a small claim for breach of contract for which you are not entitled to your costs except in the most exceptional of circumstances. Perhaps do some basic research before becoming a landlord.
Member Since October 2022 - Comments: 9
2:22 AM, 16th February 2023, About 3 years ago
There is a total imbalance for landlords and seems to be a strategic plan to drive landlords out of the PRS. For the first time in a long while I have decent tenants who only occasionally require a reminder for late rent. They all seem to look after the properties.
In the past I have had tenants racking up huge debts and then disappearing.
I have had agents miss manage so I self manage now as it was simply a drain with no protections
I made a conscious decision 4 years ago to sell as tenants leave. Unfortunately they all seem settled so I have been inactive in disposal but I will simply renovate and sell up as the opportunity arises
Member Since December 2022 - Comments: 27
6:39 AM, 16th February 2023, About 3 years ago
If there is a clause in the tenancy agreement allowing charges to be paid by the tenant then bring a claim. You should be able to claim the legal costs even if the claim is classified as small claims.
Member Since November 2015 - Comments: 584
9:38 AM, 16th February 2023, About 3 years ago
You needed to apply for a third party debt order and then you could have claimed the costs from the deposit.
Member Since October 2022 - Comments: 402
9:45 AM, 16th February 2023, About 3 years ago
Reply to the comment left by ZCJV at 15/02/2023 – 15:54
You need to ask the out for costs at the time. You need to know the rules of the game. Or have claimed against rent owed to you
Member Since February 2019 - Comments: 5
9:48 AM, 16th February 2023, About 3 years ago
This isn’t a MyDeposit thing, this is a legislation thing.
It’s unfortunate, but for a while now, the only way legal costs can be claimed from the deposit is when a court order is in place – and when I say a while, I mean at least the last 10 years (at least in my experience of court claims and deposits).
Member Since October 2020 - Comments: 1137
11:48 AM, 16th February 2023, About 3 years ago
Any person suing another is not automatically entitled to recover their legal costs from from the defendant even if they win. Its up to the judge to award costs. The deposit schemes are not empowered to act independently of this.
Member Since December 2019 - Comments: 241
1:01 PM, 16th February 2023, About 3 years ago
Did you ask for the deposit to pay the unpaid rent or to pay the legal costs