London’s County Court has set a worrying precedent for landlords who operate properties that are rented ‘jointly and severally’ but where, over the years, tenants have been left to sort out their own deposits as tenants come and go.

The judgement by Judge Luba QC concerns landlord Richard Boddy who bought a property in Maida Vale, London (pictured) in 2003 as his home.

He later moved out and rented the three-bedroom flat as a ‘house share’ with the tenants jointly and severally responsible for paying the rent and bills.

This arrangement continued via three ‘churns’ of tenants until Covid struck, whereupon it fell apart after one tenant packed her bags and returned to Australia, requesting that her deposit cover any cleaning charges and unpaid rent.

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Damages

At this point the remaining tenants sought damages arising from the non-protection of their deposits, arguing that a new tenancy should have been issued by the landlord at each ‘churn’ and that, therefore, their deposits should have been protected.

At a hearing earlier this year the judge dismissed their claims agreeing with the landlord that they were licencees and not tenants and therefore, because they did not have ASTs, the deposit did not need to be protected.

But the tenants, who still live at the property, took the case to appeal and have now won.

judge luba rental deposits

Judge Luba (pictured) agreed with them that each ‘churn’ was in effect a new tenancy and that their deposits should have been updated and protected afresh.

Read the full judgement.

He was also somewhat poetic in his judgement, highlighting how the only evidence of the original tenants was their unclaimed and ‘dog eared’ post festering in the hallway.

Boddy must pay £3,615 which is £1,205 in respect of each of the three churns which produced a new tenancy to which they were in turn either or both parties to.

Luba gave the lightest penalty he could to the Boddy as he felt that the landlord had not purposefully tried to dodge his deposit protection obligations.

The judgement affects other areas of PRS law, in particular evictions; one of the many reasons tenants can avoid eviction is if a deposit has not been properly lodged with an approved scheme, although landlords can return deposits prior to an eviction to avoid this.

julie james

Julie Ford of HF Assist (pictured) comments: “This case highlights the importance of both landlords and agents keeping accurate paperwork and taking the time to know who is in their property.

“Compliance is the most important part of renting a property and even the most hands off landlords are not immune to the ever changing minefield of legislation.”



2 COMMENTS

  1. This article is complete twaddle.

    The main issue here is that while the LL was using the property as a home then no tenancy should be offered.
    Any occupant is a lodger.

    No deposit protection required.

    Lodgers can change every day in the extreme.

    No deposit protection required.

    But as soon as the LL vacated bearing in mind the LL could reside at the home once per month to retain occupant status as lodgers then the lodgers become tenants.

    Then the LL should have complied with all new tenancy regulations.

    It is simply NOT possible to remain a Live-in LL if all bills etc AREN’T in the Live-in LL name.

    The churn situation ONLY commences from the DAY the Live-in LL vacates.

    After that all new TENANTS have to be managed accordingly.
    .That means any Joint and Several AST has to be managed correctly.

    One method is to have a Deed of Assignment.
    Though potentially it is just as easy starting a new AST.

    Lodger LL need to be aware that vacating their home converts lodgers into tenants and also means the RFRA no longer applies.

    If there is no live-in LL at a home then the occupants can only be tenants.

    This particular ignorant former live-in LL didn’t appreciate that lodger status changes as soon as the LL doesn’t reside there.

    I day per month counts as residence.
    This mainly to satisfy residential insurance conditions.

    Lodger LL need to ensure they are aware of what needs to occur as soon as they stop being a live-in LL.

    This this homeowner could have discovered by asking the local council.

    This LL was compromised because of their ignorance.

    The information is out there for free.
    The Councils being a very useful source for such information.

    This ignorant LL got off lightly!!

  2. Of course the other detail this ignorant Live-in LL forgot was that as soon as he vacated he would have immediately breached his resi mortgage conditions UNLESS he had sought CTL from his resi mortgage provider.

    He would also be committing fraud by not advising his resi insurer that he now had Tenants.

    So many ramifications thst seemingly so many LL are ignorant of.

    Their lookout.
    Won’t be too long before Councils apply RRO against LL of any type that do not conform to mortgage and insurance conditions.

    It is rapidly becoming pointless being a dodgy LL.

    RRO will be tool more frequently used to crack down on LL gaming the system.

    That means millions of homeless tenants and vastly increased rents.

    Roll on that happy day when the PRS consists of fully legally compliant LL.

    That will mean about 1 million LL out of business.

    Good that will leave the compliant ones.

    If rents increase substantially which they will that won’t be the fault of good LL!!

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