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Lana83
09-11-2009, 12:10 PM
Hello,

I am quite new to the DPS and therefore would like to ask for the advice before chosing the scheme. I am letting on room by room basis and have various length of the contracts starting from 3 to 12 months. Some of the houses I am now managing on behalf of the landlord and he/she are not involved in the whole process at all.

I am trying to to establish the scheme wich will be more efficient, cost effectiveand fair in judgements. Currently I am reading through the rules of mydeposits.co... and the gist I am getting is that landlord is on the wrong side even before the dispute arises. Is this the stance with all the schemes?

One of the rules state that I must be the owner of the property and I am not sure how to act in respect of the properties I manage as the LL is never involved in any of the paperwork and the contract is between my company and the T. Can I still register these properties under my name?

Also how necessary is it to hold the money in the client account? Some of the deposits could be in the current account, so is it likely that I will be checked?

Please help me as I am getting more and more confused now.

westminster
09-11-2009, 18:39 PM
I can't be of much help as my letting agent deals with deposit protection, but here's as much as I know...


I am trying to to establish the scheme wich will be more efficient, cost effectiveand fair in judgements. Currently I am reading through the rules of mydeposits.co... and the gist I am getting is that landlord is on the wrong side even before the dispute arises. Is this the stance with all the schemes?
Generally, the consensus on this forum is not to use schemes' adjudication service to settle disputes as they all appear to favour the tenant. The schemes claim that LLs often fail to provide sufficient evidence to support their deductions, however.


One of the rules state that I must be the owner of the property and I am not sure how to act in respect of the properties I manage as the LL is never involved in any of the paperwork and the contract is between my company and the T. Can I still register these properties under my name?
No idea. My letting agent registers deposits on my behalf with the TDS but they use my name as landlord. Are you signing the contracts on behalf of the landlord as agent (as my agent occasionally does if I'm away), or in another capacity? (if the latter, are you sure you are legally entitled to do so?)


Also how necessary is it to hold the money in the client account? Some of the deposits could be in the current account, so is it likely that I will be checked?

I think the TDS (Tenancy Deposit Scheme/thedisputeservice.co.uk) now requires that members hold the deposits in a bonded/protected account or possibly belong to an approved agents' association (not sure). You also have to insert certain clauses and the prescribed information in the actual tenancy agreement (which is probably a good thing, as it means Ts can't claim they didn't receive it - though of course you'd have to issue the TA within 14 days of receiving the deposit).

You might be better off with an insurance-based scheme as I've read at least a couple of reports regarding the DPS where they have refused to pay out on the basis of a CCJ which didn't mention the DPS in the order. There's also the potential risk of them accidentally paying out the deposit...
http://landlordlaw.blogspot.com/2009/10/tenant-in-despair-after-dps-pays.html

(Though of course in the insurance-based schemes the LL is required to lodge the disputed sum with the scheme pending resolution, the above report seems to relate to a non-disputed deposit.)

One very important thing to consider is that, as agent, you will be equally exposed to claims for failure to comply with deposit protection so you need to protect yourself as well as the deposit.

The issue of the prescribed information should not be given any less weight than the actual financial protection - failure to comply with either is equally important. With multiple deposits involved, ensure you create a failsafe system whereby you have written acknowledgment from the T that the prescribed info has been received or at least proof of postage. Also remember you must re-protect if a new TA is signed.