How to resolve an issue if you failed to protect a deposit correctly

by Readers Question

3 years ago

How to resolve an issue if you failed to protect a deposit correctly

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How to resolve an issue if you failed to protect a deposit correctly

I have a tenant who has been in the property a number of years and generally is ok. However recently the management agents of the block are coming down on occupiers who dry their washing on the balconies. I have had a number of letters from them about him and I have written and spoken to him and asked him to stop.

But he is still doing it and it looks like I may need to serve a section 21 notice to stop the managements agents harassing me (the main and sub lease forbids it). But he has been in the property a while and originally I did not protect the deposit (I subsequently did a while ago when I realised I had not done it originally)

What should I do. I know I should have protected the deposit within 28 days but did not and I’m being backed into a corner with the management agent that means I may have to ask him to leave.

I have to move on and resolve the problem and face the issue/consequences. I cannot be the only person to find themselves in this situation

N Haywashing

Comments

Neil Patterson

3 years ago

The maximum you can be fined for not protecting the deposit correctly is 3 times the deposit plus the deposit. Therefore it could be less than this, but this is where the judgement call comes in.

How big is the deposit and how likely is the risk compared to the risk of not serving a section 21.

Best case scenario is that you can reason with your tenant and the agents to avoid the situation arising especially if it is a good tenant you would like to keep.

Also washing on the balcony is better than damp in the flat, so do consider that if it is brought in.

ashley nissim

3 years ago

I've been through this & would not advise bringing it to the attention of your tenant under any circumstances.

I have had a client go through the court process to evict tenants that had their deposits protected correctly, but could not prove service of the Prescribed Information. The court came down on them like a ton of bricks & the tenants are still in the property a year later. The Landlord had to pay a fine & the tenant's legal fees.

By the sounds of it the tenant has been there for a few years & may be outside of his original contract, without a new one having been signed. If this is the case, did you re-serve the Deposit Protection Certificate, Prescribed Information & Information for Tenants leaflet at the end of the contract term? If not, you are in breach of the guidance again and can be fined for that.

As far as I am concerned there is only one thing to do to protect yourself. Decide that you no longer wish to hold a deposit for this tenant because he has been a good tenant & with you for many years now. Give the deposit back in full by cheque or bank transfer so that there is proof of the deposit having been returned (write 'deposit return' on the back of the check or as the reference for the bank transfer). A tenant is unlikely to turn down the opportunity of some spare cash a couple of weeks after his rent has been paid. Do not allow the tenant to use the deposit as rent. This way during the eviction process there is no deposit for the court to consider.

Do not take any steps to serve notice for a couple of months so that the two things are not linked. The power of the managing agent is not that great so you have plently of time to put some separation between the deposit return & the notice.

When you serve the notice do not make any mention of the washing issue as this may link the deposit return to it. You do not have to give any reason for requiring vacant posession to the tenant or court, so don't.

Good luck.

Ian Cognito

3 years ago

A few questions!

When did your tenant first move in?
When did the current Tenancy Agreement start?
When does it end and is there a break clause?
When you say "sub lease" are you referring to the Tenancy Agreement?
To your knowledge, when did the tenant first start drying his washing on the balcony?
Do any other occupiers still dry washing on their balconies?
Have you considered giving practical help to your tenant by purchasing a dehumidifier for him to use?

Carol Thomas

3 years ago

Reply to the comment left by "Ian Cognito" at "23/01/2015 - 11:50":

Hi, I've been having a wet washing issue with several of my tenants. My solution - I bought them all condensing dryers. A dehumidifier does what it says on the box, but it uses electricity to no gain. Dryers are so cheap these days. I suggest that you try this solution before evicting what seems to have been a good long-term tenant. Hope all goes well....

Ian Cognito

3 years ago

Reply to the comment left by "CaZ " at "23/01/2015 - 12:27":

I agree that a condensing dryer is preferable, if there is space.

However, it consumes power at roughly 10 times the rate of a dehumidifier (2000W v 200W). So if washing takes 2 hrs to dry using a dryer compared with 20 hours being left out with a dehumidifier switched on, the electricity bill will be he same (about 50p to £1.00 depending on tariff).

Of course, a dryer is far more practical on a number of counts, but a dehumidifier takes up much less space. It can also prove useful in removing condensation at other times (steamy shower, steam from cooking on hob etc.).

Dr Rosalind Beck

3 years ago

Reply to the comment left by "ashley " at "23/01/2015 - 09:10":

Hi Ashley.
I don't know what you mean regarding 're-issuing the Deposit Protection Certificate.' When we have protected a deposit with the DPS we receive an email and so does the tenant. Does this email constitute a certificate? And I also don't understand how this could/would be 're-issued' by the landlord. Can you clarify that one? We were discussing this issue on another thread and I understood that the deposit could just stay with the DPS as it was still protected if a tenancy went periodic and that the only thing that needed to be re-issued was the Prescribed Information...

Ian Cognito

3 years ago

Reply to the comment left by "Rosalind " at "23/01/2015 - 17:00":

Hi Rosalind. You are quite correct regarding what is required by DPS. i.e. leave deposit with DPS and re-issue Prescribed Information.

Monty Bodkin

3 years ago

Have you breached the lease in some other way?

As already asked, what do you mean by "sub-lease"?

If there is nothing more to it than you have said, then what is the management agent going to do about it? Seek forfeiture of the lease for hanging a pair of knickers out to dry?

Keep sending the letters to the tenant in response to the complaints, worded similar to the management agent, send them a copy and keep full records.

If you really want to escalate matters, serve notice under discretionary grounds 12 (breach of covenant) and/or ground 14 (nuisance).

Although there is not much chance of getting a possession order that way.

It is doubtful (but possible) your lease requires you to use an AST (and therefore a section 21).

Put the rent up for the extra hassle.

Contact the leasehold advisory service if you are really worried.

Neil Robb

3 years ago

HI All

If you have a long term tenant and you have not issued or protected the deposit correctly can you not ask the tenant to sign new agreement and give back deposit saying they have been with you so long you trust them and hope they don't realise why you have done this.

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