Return of Tenant’s rent?

by Readers Question

11:58 AM, 11th October 2013
About 5 years ago

Return of Tenant’s rent?

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Return of Tenant’s rent?

I would like help please with legal clarification over whether I have to legally return rent paid in advance by a tenant. An independent professional inventory clerk has confirmed the tenant is liable for damage and the deposit and rent held is not sufficient to cover the damage.

My tenant has paid me rent 6 months in advance through a managing agent  over the last three years. The tenancy agreement was from 24 May 2013 to 23 May 2014.

Four months into this period the tenant decided to move on, and I am holding 2 months of rent and deposit. At the start of the tenancy agreement we agreed that an independent professional inventory would be done by an independent professional company.

The checkout report provided highlighted a number of issues, resulting in costs in excess of the rent and deposit I am holding. The tenant wants me to refund this amount but I am in the process of taking legal action through the small claims court.

I would be grateful if anyone could confirm whether I could hold onto the rent and deposit until the court case?

Many thanks Rajrent money

 



Comments

Sharon Betton

12:15 PM, 11th October 2013
About 5 years ago

I will watch this thread with interest as I am not really sure about it! As always, feel sight of the tenancy agreement would help. My view would be that rent in advance is rent only, and if the tenancy agreement allows for early termination of the tenancy, then it should be returned, galling as that would be. If you are already pursuing him through the small claims court, there is no reason not to refund.

I think it does depend on what basis the tenancy agreement and the rent in advance was paid.

Dunsaw Sawyerr

12:17 PM, 11th October 2013
About 5 years ago

I am not a lawyer but I would not return the deposit and advance rent. I would immediately advise the tenant of the damage caused with a detailed breakdown of why monies is owed. I will give him 5 working days to respond. After this time then start proceedings in the small claims court.

It could be that your tenant is not aware of costs that you have or will incur and needs a right to reply. You need to be hard but fair and do not try to get the tenant to pay for fair wear and tear!

Rayhan Rafiq Omar

12:30 PM, 11th October 2013
About 5 years ago

Surely this should be really straight forward:

1. The deposit is protected (if it isn't, return it ASAP - the consequences aren't worth talking about).
2. Inventory takes place and the tenant is either happy and coughs up or is unhappy and raises a dispute with the deposit protection service.
3. Deposit protection arbitration takes in the facts and rules one way or the other.

These laws exists precisely for this reason: so that there is an objective 3rd party to solve these end-of-tenancy nonsense.

Mick Roberts

12:33 PM, 11th October 2013
About 5 years ago

I'm only commenting, so I get the email when others reply, as I too would like to know the answer. Seems right that if u have £500 rent in advance off someone, u should keep that for damages, but is it technically legally right?

Dunsaw Sawyerr

12:38 PM, 11th October 2013
About 5 years ago

Reply to the comment left by "Mick Roberts" at "11/10/2013 - 12:33":

Hello Mick

We are all waiting for the legal eagles to reply after all possession is nine-tenths of the law!

12:38 PM, 11th October 2013
About 5 years ago

HI Raj,
As people have mentioned already it would depend on the terms in the tenancy agreement.

However your tenant is liable to cover the rent upto the end of the contract or upto the day before a new tenant takes possession, as the landlord you can not be at any financial lost due to the actions of the tenant with regards to rent.

If you have an early termination clause in the tenancy agreement then this may not be possible as long as both parties have followed the correct procedure.

I am assuming you protected the tenants deposit at the start of the tenancy, also you will need to ensure that you follow protocal with regards to deducting from said deposit or indeed requesting the full cost of the deposit.

With regards to the rent, depending on the contract, if tenant vacated at month 4 of a 12 month tenancy, was there a break clause? if so you could technically charge the tenant rent upto the break clause at 6 mths.

You mention a Managing agent..... if there is damage, why did the agent not pick this up at their property inspections? what this part of the service they offered?

*i am not a lawyer*

12:47 PM, 11th October 2013
About 5 years ago

Reply to the comment left by "Mick Roberts" at "11/10/2013 - 12:33":

Hi Mick,

Rent in advance is not a deposit and thus can not be treated as such for damages etc...
You may want to have a read of the April 2013 case Johnson vs Old

i know we'd all like to think any money paid can be used if tenants cause damage but sadly this is not always the case.

Jules

Jeremy Smith

13:05 PM, 11th October 2013
About 5 years ago

Hi Raj,
To start with: " I am NOT a Lawyer" applies to me also, but I can only give my opinion.

I agree with other posters, you should give your ex-tenant a full breakdown of costs, give a right to reply, and not claim fair wear and tear.

So, if you are claiming the extra, over and above what you are holding, through the courts, then be completely transparent to the court by detailing to them the monies that you hold also.
The court wil then decide how much you can keep, how much they have to pay extra, etc.

There is no point in refunding it to the tenant, just to try to claim it back later....if you are putting in your small claims court claim in now, then any small claim your tenant puts in against you will come up after yours, and you would have had it setteld by then with your claim. - so they will be wasting their money putting in a claim against you.

Just tell the tenant that since you can't decide between you, you're taking it to court, to let the court decide fairly between the two of you.

A Note: make sure all the deposit protection/paperwork was done correctly before taking any action against them, you don't want the tenant claiming 3x the deposit from you later!

Jay James

14:58 PM, 11th October 2013
About 5 years ago

Reply to the comment left by "Julie Ford" at "11/10/2013 - 12:47":

Hi Julie

What relevance does the April 2013 case Johnson vs Old have?

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