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View Full Version : landlord in receivership. deposit safety?



boomshake
08-03-2010, 20:05 PM
so this is the story our lanlord owns the lease on our block of flats. he has our flat under one company, and apart from 2 flats other all the others have been sold off.
the two other flats he owns through another company and both tennants have been told the company that owns them(his company has gone into receivership.they both are protected by the gov deposit scheme

our flat is owned by one of his other companies which, for the moment seems ok.. but as he doesnt seem to have any money and we paid our deposit before the april 07 gov deposit scheme started. what rights do we have to safeguard our deposit if this company goes bust...??

thanks

westminster
08-03-2010, 21:05 PM
our flat is owned by one of his other companies which, for the moment seems ok.. but as he doesnt seem to have any money and we paid our deposit before the april 07 gov deposit scheme started. what rights do we have to safeguard our deposit if this company goes bust...??

thanks
Have you signed a renewal contract since April 2007? If so, the landlord should have protected the deposit. It is a slightly grey area, as the legislation isn't crystal clear on the issue of renewals, but if there has been a renewal, you should consider writing to the LL to ask about deposit protection.

(And again, if there has been a renewal, note that, if the deposit is not protected, the LL cannot serve a s.21 notice seeking possession on you. So if you are keen to stay put, this could potentially work to your advantage).

If you have genuine concerns about the solvency of the landlord company, one option you have is to withhold the last month's rent (assuming the deposit is equivalent to one month) - while I cannot recommend this course of action, it does at least ensure you are not left out of pocket. The potential downside is that your landlord may give you a bad reference.

In addition, if you have caused damage to the property (or the LL claims you have), the dispute may end up with the LL issuing a county court claim against you.

However, it is worth knowing that if you lost such a claim and got a CCJ, it would not necessarily affect your credit rating (which is particularly important these days). If you paid the CCJ within 30 days and applied for a Certificate of Satisfaction, the CCJ would not be registered against your name for credit rating purposes.

boomshake
09-03-2010, 08:59 AM
thanks for that, we have signed yearly renewal agreements, jan2008 and 2009, unfortunately he has not given us one for 2010, after asking twice! does he have to provide a new tennancy agreeement?
anyway do you know any link/documentation that refers to putting the deposit into the gov deposit scheme on renewals after april 2007.?
it is our assumption that he is thinking of selling our flat to get himself out of trouble how easy is it for him to teminate our agreement, or lack of it since jan 2010...

the deposit is quite hefty £3200 , so you see my concern, i do have all the receipts /proof of payment etc

westminster
09-03-2010, 13:07 PM
the deposit is quite hefty £3200 , so you see my concern, i do have all the receipts /proof of payment etc
First, I need to know whether your rent is less than £2,083.33 per calendar month (as the size of the deposit suggests it might be higher).

I should have asked you before, but stupidly made an assumption because you mentioned that the LL had protected your neighbours' deposits. Also is the property in England/Wales?

If the rent is higher than £2,083.33 pcm, then you do not have an Assured Shorthold Tenancy and deposit protection is not required. It would also mean that the LL could evict you more easily than if you had an AST.

boomshake
09-03-2010, 15:14 PM
ok, our rent is £2015 pcm.. the deposit was 7 weeks rent at the time of occupation. the flat is in london.

it is guesssed that the LL has protected the other two flats in question but i think they have had no proof of this so it looks unlikely.

i have spoken to the management agents appointed by the receivers, who confirm there are problems with the two flats regarding debt to a bank.

they are looking into the whole mess of affairs the ll has approx 9 buisness at least 5 look to be in huge trouble.
it looks like he has lost the building lease.

the problem is our flat could be an asset to one of his businessses that is ok, we have no way of knowing.. so do we carry on paying rent? approach the LL? i am sure he wouldnt be impressed if we said we here you are broke! what chance have we got of getting our deposit back one day..

westminster
09-03-2010, 15:32 PM
thanks for that, we have signed yearly renewal agreements, jan2008 and 2009, unfortunately he has not given us one for 2010, after asking twice! does he have to provide a new tennancy agreeement?
No he doesn't. You now have what is called a periodic tenancy. This arises automatically when a fixed term AST expires and the tenant remains in occupation. The terms of the contract remain the same except for notice - you must give LL one month, LL must give you two months (in the form of a s.21 notice). The notice must expire at the end of a rental period.

The periods start the day after the fixed term expired, e.g. if it expired 15th January, then the periods would run 16th - 15th of the month, and the notice would have to end on the 15th of the month.


anyway do you know any link/documentation that refers to putting the deposit into the gov deposit scheme on renewals after april 2007.?
The statute (link here (http://www.opsi.gov.uk/ACTS/acts2004/ukpga_20040034_en_19#pt6-ch4), see s.212-215) is somewhat open to interpretation, but is generally taken to mean that a deposit is re-received when a tenancy is renewed, even though no money physically changes hands, because the money is being held as security for the new tenancy.

It is also the interpretation taken by the DPS. See
https://www.depositprotection.com/public/legislation.aspx

See also
http://nearlylegal.co.uk/blog/2010/02/tenancy-deposit-renewal-of-tenancy-again/


how easy is it for him to teminate our agreement, or lack of it since jan 2010...
As I said above, you do have a valid contract/tenancy. If the landlord tries to serve a s.21 notice on you (the standard two months notice seeking possession), you can defend it by pointing out that the deposit is not protected. LL would then have to protect the deposit, then re-serve the s.21 notice.

westminster
09-03-2010, 15:52 PM
so do we carry on paying rent?...what chance have we got of getting our deposit back one day..
Continue to pay the rent.

You will have plenty of warning if the landlord wants to regain possession (as per my comments above). And the LL cannot legally evict you using s.21 route unless he protects the deposit.

Please note that, if you do not pay or withhold two months' worth of rent, or are persistently late paying the rent, LL can still use the s.8 notice route to evict you.

boomshake
09-03-2010, 19:05 PM
thanks for all your help
i intend to write a registered letter to the LL reqeusting info on the deposit and expect that it be transferred into the dps..
at least if he replies stating he does not beleive tis is the case , at least i have proof he is aware he currently retains the deposit and believes it unnecessary to lodge with the dps,,

im pretty sure i have an e mail saying this from a year or so back!
thanks again