Has a new tenancy been created?

Has a new tenancy been created?

10:17 AM, 29th March 2015, About 9 years ago 10

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Has a new tenancy been created?Has a new tenancy been created? If so should the deposit have been re-registered?

My tenants were on periodic tenancy following 12 month AST.

They served notice via my agent as they had found them a better house. Their last day would have been 15 Nov 2014. However, the new house fell through and as such they stayed on.

They have paid the usual rent on time ever since and look after the house so no question of any wrong doing.

I want to move back in now and have served a section 21 notice via the agent.

Tenants claim that a new lease was created on 16 Nov 2014 as their notice was valid and accepted, yet they stayed on after and I accepted rent and therefore created a new tenancy.

As the deposit wasn’t re-registered, and is still in the scheme it was originally placed in at the start of the AST, the tenant is claiming the section 21 notice is not valid on the basis that the deposit wasn’t re-registered at the start of the “new lease”.

Any ideas?


Annoyed Landlord

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Mark Alexander - Founder of Property118

10:24 AM, 29th March 2015, About 9 years ago

I'm not absolutely certain about the position so I have invited Romain Garcin to comment on this as he has proven to be somewhat of a guru on such matters.

My gut feeling is that your tenants are wrong and that you may well be entitled to charge mesne profits, i.e. double rent from the date they terminated their tenancy.

If I am wrong about the above then I am quite certain that your agent has been negligent and I'm sure that a company such as Cotswold Barristers would be very jkeen to pursue a claim - see >>> http://www.property118.com/member/?id=1945

Annoyed Landlord

10:34 AM, 29th March 2015, About 9 years ago

Reply to the comment left by "Mark Alexander" at "29/03/2015 - 10:24":

My concern is that they continued paying rent in the usual way so I've had 5 monthly payments so don't think I can now call in the double rent route. Would be grateful of advice/ opinions.

Romain Garcin

10:56 AM, 29th March 2015, About 9 years ago

I am afraid your tenants are right.

On expiry, their notice ended their tenancy. Thereafter you could indeed have claimed mesne profit at twice the previous daily rent as long as you treated them as trespassers, i.e. refused to accept rent, or otherwise accepted that a tenancy existed, and sought to get possession back.

Now, as they have been paying you rent since then and you have been fine with the situation you would have problems claiming that no new tenancy was in existence.

Regarding the deposit, I think the question is then whether you hold a deposit for this new tenancy at all.
It might be a bit late to argue that you don't, but you could still try and refund the deposit you hold (since the previous tenancy has ended).

Annoyed Landlord

11:03 AM, 29th March 2015, About 9 years ago

Oh dear, I was hoping there may be better news. I will brace myself for the 4 x deposit request now then. Thank you for your comments, whilst not what I wanted to hear, your insight is much appreciated.

Mark Alexander - Founder of Property118

11:19 AM, 29th March 2015, About 9 years ago

Reply to the comment left by "Annoyed Landlord" at "29/03/2015 - 11:03":

OK, I've never known Romain to be wrong on issues like this so let's assume he's right on this too.

Why wasn't your letting agent aware of this, is it not his duty to deal with such matters on your behalf? I think your agent has been negligent and whilst you are accountable for any Court awarded compensation, he is responsible to you for your losses relating to his negligence. I definitely think you ought to bring a claim against your agent, then change your agent if you own other properties.

Annoyed Landlord

11:27 AM, 29th March 2015, About 9 years ago

I agree. My agent at the very least should have been aware that a new tenancy had been created. From that there should have been the obvious thought process regarding the deposit. I will be asking them tomorrow how they propose to deal with this mess. Thank you for the recommendation above, I will be in touch with them if the agents are not prepared to take responsibility without action.

Mark Alexander - Founder of Property118

11:38 AM, 29th March 2015, About 9 years ago

Reply to the comment left by "Annoyed Landlord" at "29/03/2015 - 11:27":

The Court will only award your losses, question is, is that compensation awarded to your tenant by the Court or the mesne profit that could have been claimed?

Also, what about any proveable costs related to your inconvenience, legal costs etc.?

Your letting agent will almost certainly recommend that you refer your complaint to the Ombudsman. My advice would be to go straight to the Courts .... the Ombudsmen are funded by the agents and in my experience are significantly worse at dragging matters out than even the Courts, which are notoriously poor too! That's not to mention some of the ridiculous awards I've reviewed which were made by Ombudsmen, e.g. in one case £18,000 of proven losses resulted in an award of just £300!

Joe Bloggs

11:03 AM, 30th March 2015, About 9 years ago

wasnt there a missive from tessa shepperson yesterday that the need for reprotecting deposits and reserving PI no longer exists???


Mark Alexander - Founder of Property118

11:23 AM, 30th March 2015, About 9 years ago

Reply to the comment left by "Joe Bloggs" at "30/03/2015 - 11:03":

Oh yeah!

Could this be the turning point for Annoyed Landlord?

Perhaps a name change is required "Smug Landlord" maybe? LOL 😀 😀 😀

Michael Barnes

15:14 PM, 2nd April 2015, About 9 years ago

Reply to the comment left by "Joe Bloggs" at "30/03/2015 - 11:03":

I agree that the Deregulation Act changes the position from last week.

The deposit position may depend upon the Ts&Cs of the protection scheme.
With DPS custodial scheme, I think that there would be no problem; I do not know about insurance schemes.

What you would have been guilty of (in addition) was not re-serving PI. However, the Deregulation Act means that is no longer required (see Deregulation Act 2015, section 32.

So, the answer to the original question appears to be:
a) a new tenancy has been created (because you accepted rent);
b) Provided the deposit protection scheme did not require you to do anything when the new tenancy arose, then the tenant has no defense and no claim against you.

You may also have a S8 route available.

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