Deposit protection arbitration scenario/L and T are one and the same

[AndrewDod]

A young student relative of mine has encountered some oddities in a DPS arbitration process - I am helping her prepare a response to the "Landlord's" evidence and would appreciate advice/pointers.

The issue here is a matter of principle, rather than a significant amount of money involved. It involves 7 students sharing a property with a JOINT tenancy. All 7 are named on the joint agreement. Each of my comments below raises several issues for me.

a) The apparent L (see later) protected 7 individual deposits with the DPS, and repaid the first 6 prior to the end of the tenancy without any inspection.

Question: Why does the DPS allow individual protection of deposits in a joint tenancy, and is this a point of leverage? What is the implication of payment of the earlier selection of such deposits?

b) Apparent L then carried out an inspection 8 days after the tenancy ended, but importantly AFTER another tenancy agreement had already started (I have no way of knowing whether an actual tenancy had started by virtue of the next batch of students taking occupancy). On the basis of this inspection he refused to repay the final 7th deposit (which happens to be in the name of my relative).

Question: Can L carry out an inspection after the end of a tenancy agreement, but in the face of an agreement with other tenants that is beyond the start date. Clearly the previous tenants have no way of knowing whether there was another tenancy (as opposed to an agreement)

c) While reading a draft response to the arbitrator, I decided to do a land registry check on the property in question. Much to our surprise, it turns out that one of the 7 students declared on the tenancy agreement as joint tenant is in fact joint owner of the property with the declared landlord, and is hence both L and joint T. Clearly this tenant would have (and did) have a run of the property as landlord after termination of the tenancy.

Any comments on this scenario?

d) The actual claims submitted to the DPS arbitrator are very odd and probably unsupportable, but that is not the relevant issue here apart from one which I will mention. There was a term in the tenancy agreement that any lost keys would incur a £200 fee. I find this term odd in the case of a joint tenancy, where the sole responsibility of T should be to restore the property to it's previous state of security by the end of the tenancy. As it happens, half way through the tenancy one of the students was mugged and had her keys stolen. Instead of simply arranging for copies to be made and keeping it quiet, the student declared the loss and arranged for a locksmith to visit, replaced the lock with one of similar security, and bought key copies for L and all Ts. L disputed her right to do this, insisted on visiting the property, and charged T again for another similar lock of his choosing (which he insisted on fitting himself despite the perfect technical competence of the student) mid way through the tenancy. The gullible T paid L again for this lock, from her point of view ending the matter. No further claims were made by L at that stage.

However on "L's" claim to DPS, the claim includes a £50 for petrol for travel to the property 6 months earlier to replace a lock because there was "no other reason to visit". As far as T is concerned the lock was returned in the same functional state as at tenancy onset, was already paid for twice, and such landlord costs are not mentioned in tenancy agreement as having any bearing on the deposit. Further even if such a claim were allowed, T is not responsible for where L lives (e.g would a journey from the USA be allowed).

e) As an aside, Ts were never supplied with prescribed information, and the shambolic tenancy agreement is also completely silent on the matter of the purpose of the deposit other than stating it is "for damages". The tenancy agreement does not mention the inventory (which is worthless in any case). Does the agreement have to mention the inventory?

As landlord I would be interested in closing some of these loopholes myself, but for the moment I am wearing a different hat. Many thanks for any comments.

[westminster]

a) - I doubt this is particularly relevant in terms of adjudication outcome, however, if the 7th T lost, then this loss should be shared equally by all the joint tenants.
b) - To argue this point you would have to obtain evidence that the check-out was done after the new tenancy started.
c) - Arguably, then, the tenancy was not an AST , with the legal landlord being resident, (in which case deposit protection wouldn't be obligatory), but it's obviously complicated by the fact that someone else is named as LL on the contract (still binding between T and purported LL, but not binding on legal LL). At the end of the day, you'll never know the true situation/real implications unless the case ends up in court.
d) - The LL can only claim his actual losses and any reasonable associated expenses (so a trip from USA would not be 'reasonable').
e) - I don't think the contract necessarily has to mention an inventory for the inventory to be valid evidence of condition on a certain date. T has no claim against LL for failing to provide the prescribed information after the tenancy has ended (and it's not, in any case, relevant to the adjudication).

A large percentage of the deposit has already been returned to the tenants, and you say yourself that 'The issue here is a matter of principle, rather than a significant amount of money involved.' TBH, I don't think there's any point in arguing/worrying about principles when the amount at stake is so small. Deposit scheme adjudication tends to favour the tenant, so most likely the DPS will award most, if not all, of the money to T7.

[AndrewDod]

Thank you greatly Westminster.

I guess matters of principle are important sometimes, even when the stakes are low. In this case I think that the landlord claim is an exercise in bullying. As a good landlord myself (I think) I don't like landlord bullies, and in particular bullying of vulnerable and timid student tenants. Second, I am pretty sure that there was no actual damage or valid claim. This claim falls apart on multiple other grounds, including a hopeless inventory. Perhaps this L would benefit from a lesson in tightening his procedures before he is faced with a truly devastating and genuine cause for claim.

On one point I am not sure I agree. The inventory and deposit must somehow enter the tenancy agreement whether implicitly or otherwise, quite simply because the agreement has to make it clear the purpose for which the deposit is held. For example if the deposit is taken but there is no agreement that the deposit can be used against unpaid rent, then it cannot be so used.

It seems to me that if a deposit is collected, but there is absolutely no indication whatever in the agreement as to the purpose of the deposit, then the deposit cannot be applied to offset anything at all. Clearly the inventory and the TA are dissociated in time (by definition) but if the TA makes no mention of the deposit (apart from its collection), then I am not sure a disembodied inventory serves any value apart from allowing L to prove damages (which would then have to be claimed via the courts in the same way rent deficits would have to be claimed in the absence of rent-deposit linkage in the agreement).

[westminster]

On one point I am not sure I agree. The inventory and deposit must somehow enter the tenancy agreement whether implicitly or otherwise, quite simply because the agreement has to make it clear the purpose for which the deposit is held. For example if the deposit is taken but there is no agreement that the deposit can be used against unpaid rent, then it cannot be so used.

It seems to me that if a deposit is collected, but there is absolutely no indication whatever in the agreement as to the purpose of the deposit, then the deposit cannot be applied to offset anything at all. Clearly the inventory and the TA are dissociated in time (by definition) but if the TA makes no mention of the deposit (apart from its collection), then I am not sure a disembodied inventory serves any value apart from allowing L to prove damages (which would then have to be claimed via the courts in the same way rent deficits would have to be claimed in the absence of rent-deposit linkage in the agreement).

You asked "The tenancy agreement does not mention the inventory (which is worthless in any case). Does the agreement have to mention the inventory?"

I replied - "I don't think the contract necessarily has to mention an inventory for the inventory to be valid evidence of condition on a certain date."

I did not say that the contract need not specify what the deposit may be set against.

[AndrewDod]

Yes indeed Westminster - I accept that my response was at cross purposes.