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Mickey D
08-11-2005, 11:59 AM
We were expecting our tenants to move in this morning but instead got a call from the letting agents saying they had pulled out. We had signed the tenancy agreement and had been informed that the prospective tenant had payed a deposit to the letting agents.

My question is whether we would be entitled to this deposit as recompennse for the tenancy not going through?

Many thanks.

rob.jarvis
08-11-2005, 12:33 PM
If the deposit is a holding deposit, then it will be refunded to the prospective tenants & you'll get nothing. The agent might deduct a sum for expenses incurred.

I presume they had not signed the agreement before pulling out.

dazalock
08-11-2005, 12:35 PM
How was the Deposit taken?

When I take a deposit prior to the tenant moving in, I take a sum as a holding deposit. I give a reciept stating that this is Subject to contract and non returnable if the tenant pulls out.

The questions you need to ask is how the deposit was taken, was any rent taken, were key taken? You can then establish if you can retain a part of the deposit, and if a tenancy has been created.

Energise
08-11-2005, 12:54 PM
When I take a deposit prior to the tenant moving in, I take a sum as a holding deposit. I give a reciept stating that this is Subject to contract and non returnable if the tenant pulls out.

Do you have an opposing clause?

Unfair Terms in Consumer Contracts Regulations 1999

One of the specified terms in the indicative list at schedule 2 is:
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(d) permitting the seller or supplier to retain sums paid by the
consumer where the latter decides not to conclude or perform the
contract, without providing for the consumer to receive compensation
of an equivalent amount from the seller or supplier where the latter
is the party cancelling the contract;
--------------------------------------------------------------------

dazalock
08-11-2005, 12:58 PM
As I understand it, provided this has been negotiated and proven to have been done so, then non-refundable means non-refundable.

Energise
08-11-2005, 13:09 PM
I understand that, but that part of the Unfair terms says there should be an equivalent clause offering the same compensation to the tenant should the landlord pull out.

Mickey D
08-11-2005, 13:27 PM
Many thanks for all your responses. The deposit was a Holding Deposit and the Letting Agents are keeping it for expenses that THEY have incurred. We had signed the contract but the person letting was meant to do so this morning and did not.

Any further help would be greatly appreciated.

MrShed
08-11-2005, 22:03 PM
Mickey as far as I see it, the deposit will be returned, and the agent will only be able to claim from it actual monetary expenses. However, I am not even sure if they can legally retain even this, as there was no contract signed, surely the tenant has no "agreement" to pay these expenses? Just my tuppence worth :)