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Paul_f
04-02-2009, 14:14 PM
I know this is a bit long but is an extract from Estate Agent Today

A case at Leeds County Court has highlighted that letting agents may face proceedings over tenancy deposits.

In this notable case, the agents escaped penalty even though the tenant’s deposit had not been protected and the tenants not given the ‘prescribed’ information. Their lawyer successfully argued that the legislation had been badly drafted.

Diamond Properties, based in Headingley, Leeds, are thought to be the first agents to find themselves in court over tenancy deposit protection. Until now, it has been landlords who have had to face the music. The company are busy agents managing some 500 properties a year, many of which are let to students, said their lawyer.

Hayden Glinn, of Lupton Fawcett, who represented Diamond, said that while landlords were generally seen to have ultimate legal responsibility for tenants’ deposits, the Housing Act, which introduced compulsory tenancy deposit protection, lays down that “any relevant party” could face penalties.

Compulsory tenancy deposit protection makes it illegal for any letting agent or landlord to take a tenant’s deposit unless it is protected in one of three Government-approved schemes. Whoever takes the deposit must also give the tenant certain information within 14 days, including details of the scheme, address of the rental property, and address and name of the landlord.

Failure to do either of these means that the landlord – or, as this case suggests, agent – is liable to be penalised. The penalties are heavy: the court has power to order that the deposit plus three times its amount has to be handed to the tenants. Also, where a tenancy is ongoing, the landlord or agent cannot use the fast-track Section 21 procedure to regain possession.

In this particular case, a group of students had paid a deposit in May 2007, shortly before their tenancy started.

The following March, they wrote saying they had reason to believe their deposit was not protected. The deposit was duly protected that same month, but the tenants were not given the prescribed information until after the tenancy had finished and court proceedings had started. The prescribed information was supplied in December 2008.

However, Hayden Glinn was able to argue that although the intention of the Housing Act was to make it a statutory obligation both to protect the tenant’s deposit and to confirm the arrangement within 14 days, the law had been so drafted that the penalty could be escaped just as long as the deposit had been protected and the tenants informed before the case got to court.

Glinn said after the case: “I spent about 100 hours poring over the Housing Act and found it had been drafted incorrectly. What it says is not in line with its intentions. I reckon that if you were on the steps outside the court and could protect the deposit, you would escape penalty. But of course, if everyone did that, all the tenancy deposit schemes would be out of business.”

Glinn also warned that student tenants in particular were likely to try to pursue the penalty: “Across the country, students have been having a field day, knowing that a lot of landlords have not been complying with statutory tenancy deposit protection. Students are particularly well informed about the law: go on to any campus and there will be posters asking if their landlord has protected their deposit.

“The Tenancy Deposit Scheme was introduced on April 6, 2007 and since then tenants have learned to use it to their advantage. In a significant number of cases landlords have been harshly penalised not because they had failed to comply with the Act, but because they had failed to do so within the short time limit laid down by the Act. There have even been cases where a landlord has put the protection in place but just failed to notify the tenant properly.

“This is not how the Government intended the scheme to work. Tenants have exploited a badly worded piece of legislation and landlords have been paying a heavy price.”

The part of the Housing Act 2004 at the heart of this case was Section 21.4(1)(a).

But Glinn emphasised that it was far better for both agents and landlords not to overlook their obligations over tenancy deposits, and to stick to the 14-day time limits. He also pointed out that this particular case was heard in a county court, whose rulings do not bind other courts.

jeffrey
04-02-2009, 14:18 PM
It largely confirms what LZ members already know:
a. that the 2004 Act is inadequately drafted; and
b. that one can apparently protect a deposit late, as long as it's before a Court hears T's case seeking the 3x.

Paul_f
04-02-2009, 14:27 PM
It also brings up another point concerning recent posts. Some landlords don't want their address disclosed to tenants on the AST, but the TDS requires the landlord's name & address to be on the information given to tenants regarding the deposit, so there is little point in just providing an address in England & Wales (in isolation), for service of Notices if the landlord has to show his own name & address to comply with the deposit schemes.

Of course if the landlord doesn't wish to retain a deposit then the S.48 notice would suffice without the necessity of the landlord's address being disclosed. Then again under S.1 L & T Act 1985 the tenant can find out the identity and address of the landlord by a written request to his agent or collector of rent.

jeffrey
04-02-2009, 14:35 PM
It also brings up another point concerning recent posts. Some landlords don't want their address disclosed to tenants on the AST, but the TDS requires the landlord's name & address to be on the information given to tenants regarding the deposit, so there is little point in just providing an address in England & Wales (in isolation), for service of Notices if the landlord has to show his own name & address to comply with the deposit schemes.

Of course of the landlord doesn't wish to retain a deposit then the S.48 notice would suffice without the necessity of the landlord's name and address being disclosed. Then again under S.1 L & T Act 1985 the tenant can find out the identity and address of the landlord by a written request to his agent or collector of rent.
Again this highlights what a pig's ear the L&T legislation is- disorganised and uncrossreferenced.

Paul Gibbs
04-02-2009, 14:56 PM
100 hours on the Housing Act?? ........ Probably would have been cheaper for the LA to just pay the penalty!!!

Mars Mug
04-02-2009, 15:06 PM
100 hours on the Housing Act?? ........ Probably would have been cheaper for the LA to just pay the penalty!!!

That's £10,000 of Jeffrey's time ;) Money well spent of course!

jeffrey
04-02-2009, 15:23 PM
That's £10,000 of Jeffrey's time. Money well spent of course!
In my dreams...

garner86
04-02-2009, 15:29 PM
For immediate advice, LZ members can use e-mail or telephone (not LZ private message). This service costs £2 per minute (+ VAT).

2x60 = 120

120x100 = 12,000

Providing you did it all over the telephone O_o

am guessing thats where the so called 10k of your time came from :P

mind the gap
04-02-2009, 15:37 PM
I know this is a bit long but is an extract from Estate Agent Today :confused: Are Estate Agents Today notoriously or irrepressibly longwinded, or is this a non-sequitur?



Glinn said after the case: “I spent about 100 hours poring over the Housing Act and found it had been drafted incorrectly.
Well, he was either a very slow reader, or very slow on the uptake. The conclusion he reached after his protracted (and presumably expensive) 'poring' is glaringly obvious.


Glinn also warned that student tenants in particular were likely to try to pursue the penalty: “Across the country, students have been having a field day, knowing that a lot of landlords have not been complying with statutory tenancy deposit protection. Students are particularly well informed about the law: go on to any campus and there will be posters asking if their landlord has protected their deposit.
Good for them, I say.

Bel
04-02-2009, 16:02 PM
I am confused by this article;

On the one hand it says that if LL protects deposit prior to court (and not when he should have) he will be OK

On the other hand it says that many students have screwed the system unfairly (which I take it often means that LL may have protected the deposit but not in the time)

The result is that the decision can go any way according to who is on the bench at the time, but they seem to spin it in the landlord/agents favour, suggesting they can rely on the same defence. This is not a landmark decision.

P.Pilcher
04-02-2009, 16:58 PM
O.K. so who is going to shell out to appeal such a ruling and get a definitive appeal court decision? The problem is that to do so will take so much time and thus expense on behalf of some poor landlord or agent as to be a non starter - unless you happen to be the Duke of Westminster!

P.P.

lorenzo
04-02-2009, 17:39 PM
The tenant presumably gets left with the filing fee... and possibly costs?

Something to protect tenants and they get screwed over anyway. :rolleyes:

Well done NuLab

Preston
04-02-2009, 19:19 PM
The result is that the decision can go any way according to who is on the bench at the time, but they seem to spin it in the landlord/agents favour, suggesting they can rely on the same defence. This is not a landmark decision.

Hi, yes, it does seem from the anecdotal evidence that decisions are going both ways although, I have so say, the majority I have heard about are going in the landlord's favour.

The upshot seems to be that when advising a landlord who has been challenged, tell them to protect the deposit and provide the information and, if they do so before the court hearing, they will probably get away with it; and when advising a tenant whose deposit has not been protected or protected late, tell them that they might be successful with a challenge.

Lawcruncher
04-02-2009, 19:43 PM
Well done NuLab

I do not think we can blame the government or Parliament. The blame lies squarely with the draftsmen of the Act. It was a while before the flaw was spotted. It takes concentration and time to work through the wording to see where the error lies. If it took the lawyer a hundred hours it can only be because he could not believe what he was reading and felt the need to keep checking it.

Assuming the flaw was not deliberately slipped in (as if it was!) this goes to show just how tricky legal drafting can be. If top counsel cannot get it right all the time what hope is there for the rest of us? It serves as a reminder to landlords and agents that they should not engage in legal drafting. Instead, they should pay people like Jeffrey a large wad of cash to get it right.

Bel
04-02-2009, 19:57 PM
Instead, they should pay people like Jeffrey a large wad of cash to get it right.

And, by gum, he is always right. ;)

Bel
04-02-2009, 19:59 PM
Hi, yes, it does seem from the anecdotal evidence that decisions are going both ways although, I have so say, the majority I have heard about are going in the landlord's favour.

The upshot seems to be that when advising a landlord who has been challenged, tell them to protect the deposit and provide the information and, if they do so before the court hearing, they will probably get away with it; and when advising a tenant whose deposit has not been protected or protected late, tell them that they might be successful with a challenge.

But do you think the balance is thus because the LL/agent is far more likely to rely on legal representation because they are in a 'hole'?

Mrs Jones
04-02-2009, 20:33 PM
If top counsel cannot get it right all the time what hope is there for the rest of us?

Why do you assume that "top counsel" were responsible for the drafting? I used to work in the Lord Chancellor's department many moons ago and when I subsequently worked for one of the major international law firms I realised that drafting in the latter organisation was far superior to that of the LCD.:(

Lawcruncher
04-02-2009, 21:36 PM
Why do you assume that "top counsel" were responsible for the drafting? I used to work in the Lord Chancellor's department many moons ago and when I subsequently worked for one of the major international law firms I realised that drafting in the latter organisation was far superior to that of the LCD.:(

If top counsel are not drafting legislation that goes a long way to explaining a lot.

sherifffatman
04-02-2009, 23:05 PM
The objective of the Tenancy Deposit section of the Act, according to the Ministerial Impact Assessment report, was to minimise the risk of -
-deposits being unfairly retained by LL,
- LAs misappropriating LL monies,
-and, importantly, Ts defaulting on last month's rent and LL having to cover costs/damages
The Act and the 3x penalty was not intended to be used as a compensation scheme for tenants needing next month's rent, nor for LLs to avoid their responsibilities.
Section 214 should only come into play if the LL is retaining a disputed deposit and has no insurance for the T to rely on for a fair apportioning, not to punish an admin error.
Sometimes both sides have unrealistic expectations of what is due to them and how the property should be on departure.
This can often be solved by simple dialogue during the notice period rather than lengthy arguments and pricey (on both sides) legal proceedings.

Preston
04-02-2009, 23:30 PM
But do you think the balance is thus because the LL/agent is far more likely to rely on legal representation because they are in a 'hole'?

Hi, its difficult to tell. I have to say that my reading of the legislation is that late compliance is no compliance at all; but I do seem to be in the minority amongst contributors on this site and, as we have said, the majority of decisions seem to be going the other way.

There seems to be little doubt, though, that the government intended the outcome to be as in the Leeds case (I have posted extracts from ministerial statements in other threads on this site). So maybe the draftsperson is more clever than we think. Or maybe people are being influenced by the stated intentions of the legislation, rather than solely on the words themselves?

Either way, until it reaches the higher courts, no one will be sure. My guess, by the way, is that it will do; I think its the kind of issue that one of the representative or advisory bodies for tenants will pick up one day. (I could be wrong, but I doubt a landlord body will, because they have too much to loose if it goes the wrong way and whilst the majority of decisions are favouring landlords, they may consider that the risk is too great). I hope they do.

sherifffatman
04-02-2009, 23:44 PM
I believe the figures from DPS show that 80% of LLs claims on deposit are upheld.
The figures Shelter gave as part reason for the scheme's introduction were that 20% of tenants felt some or all of their deposit had been retained unfairly.
The current figures show pretty much the same scenario - ie those not getting their deposit back now are doing through the schemes and LLs have been vindicated as mostly being reasonable and fair.
Politicians would kill for the LLs' 80% approval rating!
I would like to see the ratio of small claims/county court hearings for and against both parties over deposits.
I suspect it is nowhere near the figures above.
The idea that most LLs can afford or need to employ solicitors in the small claims court is a little old-fashioned as hording all tenancy related paperwork is the main skill required by both sides.

agent46
05-02-2009, 11:04 AM
I returned to LLZ in order to refer to this case report http://www.landlordzone.co.uk/forums/showthread.php?t=16679, but another had beaten me to it.

Although it is not a Court of Appeal decision, and is therefore not definitive, binding authority, I'm not braggin or nuffink, but it goes some way to confirming 3 points I have been making for ages:

(1) In what amounts to a departure from the common law, if an agent receives a deposit, then it is he and not necessarily the landlord who is fixed with liability under the 2004 Act.

(2) Late/remedial compliance with TDP is possible and a landlord or agent can avoid liabilty so long as the deposit is protected before the hearing.

(3) The TDP provisions of HA 2004 are appallingly drafted and in some instances conflict with the guidance given by the Govt on the application of the Act.


However, I had to laugh at the solicitor's claim, “I spent about 100 hours poring over the Housing Act and found it had been drafted incorrectly". I'm very puzzled indeed by this comment because it only took me around 25 minutes to disentangle and digest the implications of the relevant sections, and that was done whilst undertaking other work, chatting to colleagues and bickering with people on this and other fora. :D

Paul Gibbs
05-02-2009, 12:47 PM
99 hours drinking tea? perpetual insomnia!

jeffrey
05-02-2009, 12:54 PM
99 hours drinking tea? perpetual insomnia!
99 hours pouring; 1 hour poring?

Impartial Advice
05-02-2009, 13:06 PM
(1) In what amounts to a departure from the common law, if an agent receives a deposit, then it is he and not necessarily the landlord who is fixed with liability under the 2004 Act.

I supported a tenant at county court level and the DJudge ruled the exact opposite of this. The landlord had never seen or handled the deposit (this was done by LA) but the DJudge awarded the 3x sanction against LL and advised during the hearing he should take his own action against LA!!!

agent46
05-02-2009, 13:35 PM
I supported a tenant at county court level and the DJudge ruled the exact opposite of this. The landlord had never seen or handled the deposit (this was done by LA) but the DJudge awarded the 3x sanction against LL and advised during the hearing he should take his own action against LA!!!


Did you refer the judge to (from memory) s.212(9)? That subsection defines the term "landlord" for the purposes of ss.212 - 215 and although I can't remember exactly what s.212(9) says, it certainly includes letting agents within its ambit.

jeffrey
05-02-2009, 13:44 PM
Did you refer the judge to (from memory) s.212(9)? That subsection defines the term "landlord" for the purposes of ss.212 - 215 and although I can't remember exactly what s.212(9) says, it certainly includes letting agents within its ambit.
Here's s.212(9), with my underlining. The * is my insertion, for clarity.

In this Chapter:
(a) references to a landlord or landlords in relation to any [assured*] shorthold tenancy or tenancies include references to a person or persons acting on his or their behalf in relation to the tenancy or tenancies, and
(b) references to a tenancy deposit being held in accordance with a scheme include, in the case of a custodial scheme, references to an amount representing the deposit being held in accordance with the scheme.

agent46
05-02-2009, 13:44 PM
99 hours pouring; 1 hour poring?

Pour, por, poor old client I say!

I know it's a bit turgid and it cross-refers to other sections, but 100 hours to read and interpret s.214!!!!???? Was he having to translate it from Ancient Sumerian using the Rosetta Stone or something because that's over two full weeks of 9 - 5 where he did nothing but read one section of an Act?

I'm all for being sure of one's advice and arguments, but it's hardly the best advert for the firm is it?

agent46
05-02-2009, 14:04 PM
The figures Shelter gave as part reason for the scheme's introduction were that 20% of tenants felt some or all of their deposit had been retained unfairly.
.

Let's unpick Shelter's statement.

(1) They [tenants] 'felt'....: Why bother with evidence, reason and logic when you can just rely on "feelings" as a reason for Parliament to legislate?

(2) On virtually every occasion, both parties to any form of dispute or litigation "feel" they had been hard done by, but one of them will inevitably lose the case, thus proving that their feelings were misplaced.

(3) ...retained unfairly: Not "unlawfully", but "unfairly".

(4) Define "unfair".


That's just 4 points off the top of my head.

Impartial Advice
05-02-2009, 14:57 PM
Did you refer the judge to (from memory) s.212(9)? That subsection defines the term "landlord" for the purposes of ss.212 - 215 and although I can't remember exactly what s.212(9) says, it certainly includes letting agents within its ambit.

If i was that good I'd be rich :D

But seriously it wasn't really an issue for the tenants. They didn't really care who paid them the deposit back they just wanted it returned!

jeffrey
05-02-2009, 15:00 PM
If i was that good I'd be rich :D

But seriously it wasn't really an issue for the tenants. They didn't really care who paid them the deposit back they just wanted it returned!
Return of deposit is one thing; 'return' of triple deposit is quite another!

sherifffatman
05-02-2009, 21:10 PM
Calm down agent46
I am well aware of the bizarre nature of the Act as i am currently waiting for a judgment on a case i detailed last friday.
I have also read the HA04 objective/mission statement I referred to and it is enough to make you vomit as a LL and at least a bit patronising if you are a T.
As you say it is all about feelings of being hard done too rather than concrete figures of mass misappropriation on any side.

The whole point to adr in the case of a dispute (which, if you check the wording, can only be initiated by the T) is that both sides should have proper documentation & take proper care of the property.
The reason some LLs are winning is because they have a vested interest in the condition of the property as they own it and thus keep the paperwork.
Whereas, it is common for the T to not know where their copy of the AST is at the end of a tenancy.
The 3x deposit charge is unreasonable as it would be deemed an unfair term in most other contracts, surely.
What if the T was only able to apply for it when they were not in arrears?

The statement above was not my words but those of a charity which helps homeless people...who presumably are/were on social housing lists rather than private sector?

There needs to be more all round recognition of the co-operation required between the LL & T without the onus falling on one side or the other.
We should having a go at each other & recognise that our common enemy is the legislative body!

agent46
05-02-2009, 21:17 PM
Let's unpick Shelter's statement.

(1) They [tenants] 'felt'....: Why bother with evidence, reason and logic when you can just rely on "feelings" as a reason for Parliament to legislate?

(2) On virtually every occasion, both parties to any form of dispute or litigation "feel" they had been hard done by, but one of them will inevitably lose the case, thus proving that their feelings were misplaced.

(3) ...retained unfairly: Not "unlawfully", but "unfairly".

(4) Define "unfair".


That's just 4 points off the top of my head.

Sheriff. Please see above.

sherifffatman
05-02-2009, 21:29 PM
Fair enough there agent but you're hardly going to get an answer from Shelter on here are you?!
Or an answer from the DCLG who have gone through hundreds of ministers since the Act was first mooted.
Just proves that the 'general will' goes with the loudest regardless of numbers
Populist laws for the People - hurrah
Strikes me as odd that in this country where we have laws against stereotyping & prejudice of all shapes & coulours that such a subjective and prejudicial statute was passed.

what do you think about no 3x claim until rent acc settled?
or how the homeless can comment on the private rented sector?!!
:)

as for unfair - just means it in a playground stylee as far as i can see

Lawcruncher
05-02-2009, 21:41 PM
Calm down agent46
I am well aware etc

What you need to remember is that the failure of some landlords to return deposits had reached scandalous proportions. They were simply treating them as extra rent. Something had to be done. Think what tenants were being asked to do: to hand a sizable chunk of cash to a stranger to look after.

A good landlord can have no reason to object to the deposit scheme. The deposit is after all the tenant's money. It is entirely reasonable that it should be protected and that the tenant has the security of knowing that he has a chance to argue his case and is guaranteed to get the deposit back if he is not at fault. If there is to be protection there have to be sanctions for failing to provide it. The sanctions can easily be avoided - protect the deposit.

There ought to be a rule that a landlord cannot demand a deposit unless he provides one of equal value to secure the performance of his obligations.

mind the gap
05-02-2009, 21:55 PM
There ought to be a rule that a landlord cannot demand a deposit unless he provides one of equal value to secure the performance of his obligations.

Do you mean a fund on which the tenant may draw to : fix the boiler/shower/toilet when the LL fails to act, better insulate the property so as to reduce energy bills and employ a cleaner if the place isn't spotless when they move in?

I don't see why not - a basic deposit of £1000 should be enough to begin with - to be topped up from rent, if LL fails to top it up himself?

sherifffatman
05-02-2009, 22:12 PM
Lawcruncher - on what basis do you make the accusations that LLs regard the deposit as extra rent?
What proportion of LLs does this refer to?
It is your opinion that LLs do this yet you fail to recognise that the deposit is not there for the T to use as the last month's rent, unless through prior bilateral agreement.
The rent is contractual not arbitrary thus the full term must be paid before the deposit can be released with or without deductions or disputes.
The T is in possession of property worth many times more than their deposit.
It is the property itself that secures the LLs obligations - ie it is a deposit in another form.

mind the gap
05-02-2009, 22:25 PM
The T is in possession of property worth many times more than their deposit.It is the property itself that secures the LLs obligations - ie it is a deposit in another form.

This is a flawed argument. The tenant is not 'in possession' of the property in any sense other than physically occupying it; he has no financial security against the LL's failure to comply with his stautory obligations other than to withold rent, which he is always advised must be a very last resort. He cannot sell off a bit of the proerty to pay for repairs or services when the LL does not, can he?

Read this post and ask yourself : what is this tenant to do? His situation is intolerable and he should be able to remedy the situation quickly, but cannot:

http://www.landlordzone.co.uk/forums/showthread.php?t=16718

sherifffatman
05-02-2009, 23:17 PM
Sorry mtg but i don't understand your reasoning
This is a consumer contract being entered into on 2 sides.
It shouldn't be signed by anyone unaware of potential consequences.
LL provides property and is bound to keep it in good order under the obligations of the HAs etc and T accepts to be bound by the agreement and provides a deposit to these ends.
Surely substandard housing is an environmental concern and Ts should inform relevant authorities (council, cab, shelter!) if there is that sort of problem.

LLs get bad press for a very small proportion of bad apples - check that objective statement - when most would just like their tenants to pay on time and inform them promptly of any problems so they can sort them out.
My tenants are top at this and in 20 odd years have only had to go to court twice, both as claimant due to non-payment of rent (for which i can not claim 3xthe value for breach of contract)

I'd just like to know how many of the Ts disputing deposits were in arrears.

As to the chap with no hot water, that is an awful situation.
He seems to have had no support from anyone.
And his LL does sound an ogre
My advice would be to get the hell out of there but it is impractical.
Letters detailing these problems needed to be sent as soon as the problem occurred - unfortunately as it seems to have been left on an informal reporting basis the LL has ignored it.
Next step would be the council/cab surely to get everything on record - which is what it may all come down to in the end.
He could of course ring a plumber himself and get him to invoice the LL under his HA responsibilities :)

Lawcruncher
05-02-2009, 23:24 PM
Lawcruncher - on what basis do you make the accusations that LLs regard the deposit as extra rent?
What proportion of LLs does this refer to?

I cannot quote you any figures. It was however plain that action was required. I would have been happy to see deposits banned. Landlords used to manage perfectly well without them. Too much money is tied up that ought to be sloshing around the economy. But they were not banned. It was just required that they should be protected. The procedure is hardly onerous. You complain about the government being populist. That is the cry of those who do not approve of the action taken. When they want action taken and the government does not take it they accuse it of not listening. Governments cannot win. Are you suggesting that landlords should be the sole arbiters of how the deposit is dealt with?


It is your opinion that LLs do this yet you fail to recognise that the deposit is not there for the T to use as the last month's rent, unless through prior bilateral agreement.
The rent is contractual not arbitrary thus the full term must be paid before the deposit can be released with or without deductions or disputes.


Well, a tenant ought to pay the rent up to the end of the tenancy. But trusting tenants were doing that and leaving properties clean and tidy and fit for immediate reletting, only for the landlord to withhold the deposit on dubious grounds. They then had no deposit to put down for the next property. If a tenant pays regularly and says to the landlord "Take the last month's rent out of the deposit" the deposit has served its purpose as a rent deposit. There is no loss. Tenants who trash places are usually tenants who do not pay rent.

Too many landlords complain that the law is weighted in favour of tenants. What do they want? The right to put tenants on the street without notice and due process of law? The right to keep tenants in run-down accommodation wth no obligation to repair it? The right to barge in at any time of the day or night for any reason? Rent subsidised by the state?

Of course there are a lot of bad tenants out there. There are adequate laws to deal with them. The problem is that landlords, like anyone else, have the problem of enforcing their rights. There is no reason for them to be afforded special privileges.

No one is forced into letting. They should go into it with their eyes open.

Paul Gibbs
06-02-2009, 06:44 AM
what do you think about no 3x claim until rent acc settled?



Are you saying T should not be able to commence claim until arrears cleared? If so you can see the argument now that jsut because they do not have funds should not prevent T's right to a fair trial - most DDJ's I think would allow T's claim to continue.

dont forget that LL can claim set off within the defence for damages and/or rent arrears. The problem again here is that a weak DDJ will jsut suggest each party walks away!

The problems with the deposit issue are well knon, however, because of the poor drafting judgment can go either way. It appears to be the case that mostly the LL is ok if its protected before the hearing, however because there is no binding authority on the county courts each DDJ can make their own interpretation - hence decisions going either way and leading to a real lack of clarity.

agent46
06-02-2009, 09:54 AM
Are you saying T should not be able to commence claim until arrears cleared? If so you can see the argument now that jsut because they do not have funds should not prevent T's right to a fair trial - most DDJ's I think would allow T's claim to continue.



I'd disagree with that. I've not done one for a couple of years, but I had quite a bit of success running arguments on behalf of landlords in rent arrears cases when the tenant has counterclaimed for damages for eg: disrepair, that the counterclaim should only be allowed to proceed upon the payment into court of the rent arrears in order to to abide the event.

It is only just, fair and efficient that a (probably) impecunious tenant cannot take a risk-free punt on getting a favourable and more importantly, enforceable judgement against the landlord, when the reality of the situation is that if the landlord wins, he will (by the very fact of gaining possession) have no means of finding the tenant to enforce the judgement and/or be saddled with a worthless judgement against a potless litigant. I also utilised arguments to the effect that it more or less amounts to an abuse of the process of the Court for a tenant to run a counterclaim when they have no means of settling the judgement if the landlord wins.

I have authority somewhere buried deep in my memory or one of my housing law case summary books that such an order does not deny the tenant a right to a fair trial. If I have time, I'll try to dig it out.

nask70
06-02-2009, 10:02 AM
for students take 3 months advance payment--use the first asdvance paymetn as a depsoit bu reword it as advance payment--let the student know that if they damage any thing they will not get the advance payment back. simple it works for me, then agian i have foreign students!!!:)

agent46
06-02-2009, 10:04 AM
for students take 3 months advance payment--use the first asdvance paymetn as a depsoit bu reword it as advance payment--let the student know that if they damage any thing they will not get the advance payment back. simple it works for me, then agian i have foreign students!!!:)

You're not half as clever as you think you are - that scheme of payment would almost certainly amount to a deposit.

SALL
06-02-2009, 10:08 AM
for students take 3 months advance payment--use the first asdvance paymetn as a depsoit bu reword it as advance payment--let the student know that if they damage any thing they will not get the advance payment back. simple it works for me, then agian i have foreign students!!!:)

Good luck to you, if you have to go to court with this defence.

If the "advance payment" can be used against damage to property, then it is a deposit and should be protected like a deposit.

jeffrey
06-02-2009, 10:10 AM
You're not half as clever as you think you are - that scheme of payment would almost certainly amount to a deposit.
Yes. nask70: see my post #27.

Paul Gibbs
06-02-2009, 11:46 AM
I'd disagree with that. I've not done one for a couple of years, but I had quite a bit of success running arguments on behalf of landlords in rent arrears cases when the tenant has counterclaimed for damages for eg: disrepair, that the counterclaim should only be allowed to proceed upon the payment into court of the rent arrears in order to to abide the event.

It is only just, fair and efficient that a (probably) impecunious tenant cannot take a risk-free punt on getting a favourable and more importantly, enforceable judgement against the landlord, when the reality of the situation is that if the landlord wins, he will (by the very fact of gaining possession) have no means of finding the tenant to enforce the judgement and/or be saddled with a worthless judgement against a potless litigant. I also utilised arguments to the effect that it more or less amounts to an abuse of the process of the Court for a tenant to run a counterclaim when they have no means of settling the judgement if the landlord wins.

I have authority somewhere buried deep in my memory or one of my housing law case summary books that such an order does not deny the tenant a right to a fair trial. If I have time, I'll try to dig it out.

I agree that where the LL has commenced the claim the argument is weakened, however when T issues for 3x deposit the argument is stronger

thomas12
09-02-2009, 18:37 PM
Does anyone please know the county court case law reference for this ie Diamond properties v... , and how to get a transcript - I have no idea where to start!

Many thanks

sherifffatman
09-02-2009, 20:16 PM
I agree that where the LL has commenced the claim the argument is weakened, however when T issues for 3x deposit the argument is stronger

Fully agree with what both you and agent46 are saying.
It is this type of compo claim that should be struck out until all accounts are paid.
Piggybacking a rent arrears claim with a defence/counterclaim that is purely a 3xreclaim should not be allowed.
:mad:

lostprince
09-02-2009, 21:51 PM
I have posted this elsewhere, but am I the only one who's read the above and believes that point 81 (Enforcement) firmly counts the tenant as responsible for ensuring that the DPS is in place? I'd agree that the LL is responsible if he ignores or avoids it, but the amount of stick LL's receive over this slip up is unfair.

Palmerforpresident
11-08-2009, 16:09 PM
Sorry to bump this but basically I'm having a dispute with the exact company in question. We've been waiting quite a while since we initially applied for our deposit back after moving out so I rung up today and I've basically found out that the deposit isn't protected. Eventually the manager rung me back with regards to it and he was being all very friendly and nice and saying how they would only take fair deductions of the rent. I did mention what I know about the case in question and such like and his response was "well, you know the history so we've won once and you'd just lose(although this did change towards the end of the conversation when I mentioned a bit more of the research I'd done)."

I don't really know what to do with this considering they've already won a case and to be honest I'm just wanting our deposit back in full (although I'm not sure about the other housemates when they hear about the 3x stage). He basically told me in no uncertain terms that if we took him to court he'd just put the money in a deposit scheme before the court date. He's wanting us to go into the agency and spend a day going through the dispute over what money should be taken off the deposit (I don't live in Leeds any more so that is a pain in the arse in itself). The thing we've got to argue against with this is that they weren't our agents when we moved into the house (he initially tried to get me on this by saying that our first contract was signed before April 2007, but I know it wasn't and explained to him that we were sat in his office when we rung up the initial deposit scheme). As they weren't the agents, they really don't know the condition of the house before we moved in to it, and believe me it was in a far worse condition than when we left it. He said that there is a term in the contract that states that the house has to be left "clean and tidy," which we felt it was left (we spent a LONG time cleaning it to make sure we got our deposit back). But he is now saying that I can ring up the girl moving and her parents who looked around the house on the day we moved out to prove it wasn't left clean and tidy. The thing is I said that clean and tidy is surely a difference of opinion between everybody and the girls parents are always going to be unimpressed with a student house (and this was a very 80's style, not nice house quite simply). I really don't know what to do about it. I'm going to the Citizens Advice tomorrow, but does anyone think it's worth going after them? Or am I going to be fighting a losing battle. I think the whole putting it in a deposit scheme before the date in court is a ridiculous loophole (it's ironic that they won their court case by exploiting a loophole that they argued was stopping students from exploiting another loophole!). Any suggestions?

awt19
11-08-2009, 16:28 PM
If it were me, I would wait until the LA repays you the amount he is going to repay you, dont sign anything or agree anything as full and final settlement.

And once you have that money, then sue for the amount of deposit not returned, and the 3x penalty.

This way he wont be able to protect the money before going to court, and you have a pretty strong case.

westminster
11-08-2009, 16:29 PM
I don't really know what to do with this considering they've already won a case and to be honest I'm just wanting our deposit back in full (although I'm not sure about the other housemates when they hear about the 3x stage).

Is the agent also your landlord or is the LL a separate individual?

If the latter, you could always issue a claim against the actual LL. Bear in mind that the rules have changed recently and S.214 claims (for 3x deposit) are now allocated to the multi-track, which means the defendant can recover their legal costs if you lose. You have to use form N208 to issue the claim (you can't use money claim online).

Alternatively, you could issue an 'ordinary' claim against the LL for return of the deposit full stop (i.e. don't claim for the penalty). This'll go via the small claims track where no legal costs are recoverable, so it'll be safer for you. If LL has no record of the condition of the property at the commencement of the tenancy (such as an inventory report), then it'll be almost impossible for LL to prove you caused any damage, i.e. you'll win and get all of the deposit back (plus the court fee and any travel expenses you incur).

Palmerforpresident
11-08-2009, 17:58 PM
The LL is a separate individual (we've never met him) so it might be worth going down that route instead. The taking of whatever deposit they want to give us back before going to court seems quite interesting but that would definitely involve us negotiating with them and the manager of the LA seemed quite intent on keeping some of the deposit. I also forgot to mention that when he was talking about the money he'd taken for it being cleaned, he said that it was because he told the new tennants that if they weren't happy with the condition when they moved in then they would pay for the cleaners to get it to their satisfaction. Surely them charging us for this is unfair because anyone in their right mind moving in would ask for it to be further improved even if they are satisfied with it?

I've spoken to my housemates and they're all wanting to go for the claims route, but obviously the route that has the least risk of us incurring massive costs if we lose. I'm also a bit confused as to whether it would be better to claim against the LL or the LA. What do you think would be the best situation? If we do claim against the LL but the LA are trying to give us back part of the deposit, do we just not accept it?

theartfullodger
11-08-2009, 19:42 PM
I am aware of another case where the tenant took court action against the agent (in my view incorrectly). Court held in favour of tenant (deposit plus 3xfine, £3k+) and awarded said sum in favour of T from Agent. I think I recall agent didnae turn up... (silly boy...)

Would I be right that the judge got it wrong & the agent can appeal in some way??

Cheers!

Lodger

Paul Gibbs
12-08-2009, 08:35 AM
agent could appeal but would need to explain why they could not attend trial. The deadline for an appeal has probably passed.

I would not say that the judge got it wrong, simply that he has interpreted the Act differently. The whole problem here is that the Act is unclear.

awt19
12-08-2009, 09:11 AM
I've spoken to my housemates and they're all wanting to go for the claims route, but obviously the route that has the least risk of us incurring massive costs if we lose. I'm also a bit confused as to whether it would be better to claim against the LL or the LA. What do you think would be the best situation? If we do claim against the LL but the LA are trying to give us back part of the deposit, do we just not accept it?

Claim against both the LL and LA (thats what I, and most others I have read about have done).

As for the costs, there is always that chance, but I do recall a case where the LL protected the deposit after the claim was made, and the tenant lost the case, BUT didnt have to pay costs, as when the claim was made, it was unprotected.

McRav
04-02-2010, 16:17 PM
I'm a landlord who hadn't checked out the full details of the DPS and registered the monies in the account but didn't deal with the prescribed information. My fault entirely.

The ex-tenants - students - put in an application for 3x (over £3K!!). The hearing has begun but was adjourned.

Further to the Harvey v Bamforth ruling, am I clutching at straws to think I might have a chance should I be able to get prescribed info to the tenants in the interim period before the hearing resumes?


Any ideas there?

westminster
04-02-2010, 16:26 PM
I'm a landlord who hadn't checked out the full details of the DPS and registered the monies in the account but didn't deal with the prescribed information. My fault entirely.

The ex-tenants - students - put in an application for 3x (over £3K!!). The hearing has begun but was adjourned.

Further to the Harvey v Bamforth ruling, am I clutching at straws to think I might have a chance should I be able to get prescribed info to the tenants in the interim period before the hearing resumes?


Any ideas there?

Are Ts claiming just for failing to provide prescribed info? Has the deposit been returned to T, or is there a dispute over deductions and it's still with DPS?

Rubysnanna
06-11-2010, 01:01 AM
for students take 3 months advance payment--use the first asdvance paymetn as a depsoit bu reword it as advance payment--let the student know that if they damage any thing they will not get the advance payment back. simple it works for me, then agian i have foreign students!!!:)

An advanced payment which is then returned to the T can only be classed as a deposit. In Law your argument would not work, thankfully. You are taking advantage of foreign T's. I would like to see a T leave your property in good working order, with no issues, and take you to court for not protecting their deposit. It doesnt matter how you dress it...an advanced payment which is then retrned if there are no issues will be called a deposit!