UK Landlord Forum / Life

Hello,
I'm wondering if there's anyone who might have some advice for me with an issue I've got having recieved a letter last month from a solicitor.

I rented the house I'd owned & lived in to a tenant when I moved in with my girlfriend. The deposit was paid and returned in full after the end of the tenancy which had moved from the 12 month AST starting in August 2013 and ending when the tenant gave notice in June 2015. The tenancy had ticked over onto a periodic tenancy by this point. I have no good excuse for not putting the deposit in a rent deposit scheme but I'm now being pursued by solicitors for 2 breaches of the deposit requirements, breach 1 being the start of the 12 month AST and breach 2 being the move into the periodic tenancy and they're demanding the full deposit payment x 3 for each breach.

As the deposit was returned in full and I have signed paperwork confirming this, and it was 2 1/2 years ago can they make this demand?

Lastly, the figure on the solicitor's letter regarding the deposit amount is incorrect so can I assume they have no evidence of the deposit other than a tenant's word? if that's the case what can they do other than threaten court action?

Thanks for your time,
Sandstrom

Quote from: Sondstrom on December 15, 2017, 07:29:29 PM
As the deposit was returned in full and I have signed paperwork confirming this, and it was 2 1/2 years ago can they make this demand?

They have 6 years (and 30 days) to make a legitimate claim.  The claim isn't for a non returned deposit, it's for the lack of protecting said deposit.  Maximum amount awarded in court would be 3x the deposit, minimum would be 1x.  They are obviously trying it on with regards to the maximum pay out possible which I feel (As a lay person) wouldn't happen as it was returned.  The issue is, if it goes to court an award will be made and legal costs will need to be paid.  I'd head them off at the pass, offer less than 1x, when that's rejected go up to 1x?

Thanks Riptide. I was wondering much the same but it feels just like a smack in the face.

I realise that I should have done the deposit scheme but to be chased by personal injury lawyers so long after the event is wrong. The tenant was happy with the conclusion of the tenancy and this is not what the rent deposit scheme was for.

Also, I was told by a reliable source that its 3 years they have to claim like this, not the 6 you mentioned. I'll have to check up on it.

...I'm still curious what they have in writing though... if they can't prove a deposit payment was made then they'll not be able to go any further than threatening letters guessing what the deposit amount was.

Riptide is correct
Limitation Act 1980 - s5 simple contract - six years from the date on which the cause of action accrued (i.e. when the landlord failed to protect the deposit)

Perhaps your reliable source was referring to personal injury claim? Which is three years

Best of luck

Thank you both for your input. I'll be getting a reply in the post this week and I'll get back on the forum to detail the outcome.

Double-check anything else your reliable source has told you. The guys on here know enough about deposit claims to be correct in almost everything. From what you've described thus far - you're on the hook for something. That something being a loss if it went to Court, which (as advised) I would try to avoid with clever counter-offers.

In your reply, I would be stressing that you understand this situation very well indeed (obviously stretching things a little bit there) and there is very little chance of any Court awarding 3x the deposit amount for both violations. However, you might want to come clean and say you also understand the Court has no choice but to offer 1x (they can not let you off, or decided against you and penalise you to the tune of 0x). You obviously know you don't get sympathy through claiming ignorance or anything like that.

So, I feel like you'll end up paying something here... try to take advantage of the time of year... an offer of £s from you at this time of year could be a bird-in-the-hand (it all depends on what kind of Tenants they were... were they low-end, for who £X will mean a massive difference? Or, were they high-powered professionals who will be able to wait so they can hope to extract all they can from you. I'm assuming the former because of where the claim has come from... No Win No Fee?

As far the amount of deposit being provable... well, how was it paid (and repaid)? Bank transfer, cash into your cold sweaty palms... there's usually a trail even if the amount of deposit is not explicitly mentioned in the AST itself (like it would be in mine). If there truly is no record, is there a record of the rental amount? If so, and the rental amount is £500 and the deposit is something like £500 or £600 or something akin to that - no-one would believe you if you said you'd asked for a deposit of £50.

It's a nice try, though. 

Thanks for your response HippoGriff. I do think my source is either wrong or I've misheard what's been said. Its very surprsing that it'd be incorrect info as the source is well versed in landlord/tenant matters but I'm going no further in detailng who or why. I may well have just misheard... My heart was beating like the proverbial buggered clock when I was on the phone to them and imagining a very miserable Christmas.

Your absolutely right about it being "low end"... still a very nice 3 bed house which I'd spent a lot of money on to live in myself. The tenant was largely HB but worked part time so there was the monthly top up which was always paid but rarely on time.They're no doubt just after the free cash and probably has high expectations for Christmas... was always a bit of a dreamer.  I heard from someone at work that this very scenario was on Judge Rinder on TV a couple of weeks ago so the Jeremy Kyle Clique will be onto this in no time.

As you say, theres really no chance of a settlement of less than x1 for each breach but thats certainly where I'm planning on starting in my correspondence including reference to how happy the tenant was when they moved in and how the tenancy was conducted largely satisfactorily and ended without acrimony. The "largely" is a long winded story I'd be happy to get into after this is settled but certainly not before. Anyway, I certainly have no intention of going to court unless it gets to x2 for each breach then I'll put my thinking cap on.

As for time of year, the letter states that their office closes for Christmas on friday so I'm not planning on making a x1 offer before then. As you say though, January & February blues could mean a bird-in-the-hand scenario.

With the deposit figure being wrong, I just feel that they have nothing in writing to prove a deposit was even paid and it was received and returned in cash for which I have singed & dated paperwork. It was also detailed very clearly in the AST agreement along with the rent figure so its either a typo or they have nothing in writing. I know the tenant has moved at least twice since vacating my property. If they have nothing in writing confirming a deposit was paid surely no self respecting law firm would go to court knowing they can't prove anything in the first place. The rent was paid by bank transfer and a couple of months before the end of the tenancy I provided a letter of the state of the rent account to the tenant at their request so I knew they were off and was happy enough for that to happen.

While maybe they wouldn't believe a deposit of £50 for a tenancy, if they can't prove it wasn't £50.00 what can they reaslistically do? if the law requires a multiplication of a specific figure for proposed damages then surley they have to know and be able to prove the figure. I think whatever offer is made and accepted I certainly want to see what proof they have that a breach of the housing act even occured.

Um... I think that it'd be wisest to offer something low before Christmas. It's the "a bird in the hand" mentality I would want to take advantage of now. Hard times or a good Christmas... take your pick ex-Tenant.

I do not know the answer to this, as I'm actually unsure where the burden of proof lies (one would think with the claimant, but maybe not)... but I do wonder if a Court can compel a Landlord to provide the AST they must hold on record, clearly detailing the deposit? I do not know the answer to this as I'd never be thinking of going to Court in this kind of scenario. I would bring this to a close as quickly, and effortlessly, as I could.

As we always say... you'll not make the same mistake again. Unless you have, of course. 

I definitely would get some legal advice of my own OP. You simply do not want to go anywhere near the court because legally you hadn't done what you were supposed to do unfortunately. Making an offer of offers sooner rather than later is the better option, afterall worst case scenario if the tenant rejects every offer and you all end up in court, the Judge will want to see every effort was made to settle beforehand?

Also it seems like your ex tenant is using a no win no fee company that will not look into detail at every case they 'take on'. They just try for as many cases as possible and hope for the best outcome, ie some sort of settlement from which to take their fee.

Do some research but I think it would be a good idea to put 'As to save costs' at the top of any offer that you make.  I think (do some research) that if you add that and make an offer of 1x and they ignore it, go to court, get awarded 1x this can have an implication on the legal costs as they weren't necessary in to the first place.

https://www.lexology.com/library/detail.aspx?g=6d99f4ce-2801-4050-ba52-bfe7af9990a1 I got the wording slightly wrong.

Quote from: Riptide on December 17, 2017, 05:48:33 PM
Do some research but I think it would be a good idea to put 'As to save costs' at the top of any offer that you make.  I think (do some research) that if you add that and make an offer of 1x and they ignore it, go to court, get awarded 1x this can have an implication on the legal costs as they weren't necessary in to the first place.

Thanks Riptide, definitley sounds like good advice.

I'll start low on any offer butif it gets to a certain point I'll definitely seek professional advice but at the moment want to try to keep costs down. A no win no fee solicitor might also feel a little less bullish if dealing with another solicitor who is being paid by the hour.

Quote from: Sondstrom on December 17, 2017, 08:18:21 PMA no win no fee solicitor might also feel a little less bullish if dealing with another solicitor who is being paid by the hour.

Can you explain why you think that?

I feel exactly the opposite, so I'm genuinely curious. And, surely, the small problem here would be that the other Solicitor is being paid by the hour, by you. And in a Court case you are likely to lose (except for the small hope you have that a Court would believe and hold up the fact that you're claiming there wasn't even a deposit in existence at all). Which does seem somewhat far-fetched? I mean... you, and all of us here, know you'd effectively perjure yourself on that front, right?

I'm with Hippo, they couldn't care less how many hours you're billed for and you really do have to consider their costs if it goes to court.

Ambulance chasers won't give a toss how much you are spending,why would they? Between that hope and trying to claim there never was a deposit,you are clutching at straws.The advice above is right,but you are wasting bargaining time.The credit card bills arrive in January,which might be your last chance to use some leverage.
I hate to tell you this,but there is no Father Christmas.

Well maybe you're all right about it making no difference to them about getting a solicitor involved.

I'd have thought that if they've rejected a couple of low offers and its got to a rejected sum of deposit x 3, then a letter from a solicitor stating no intent to go further in correspondence and to proceed to court was sent you've got a young ambulance chasing solicitor going to court (possibly for the first time) and being up against a solicitor who's got years of experience in landlord/tenant issues who has been recomended to me... I'm really surprised you don't think that'd make a difference to how much they think they can be demanding.

I've researched the solicitor who's dealing with it and have seen which Uni was attended and the dates of graduation. The CV is also posted on a job website.

Anyway, I replied but am yet to get any response to my first offer so I'll keep you informed of the prgress.

Thank you all for your advice.

No matter how experienced your legal team, they cannot alter true facts and the law as it clearly stands. There is also the Judge who would have the final say if you end up in court?
All the best for a good outcome for you.

Yes,certainly hope this goes well.I know you failed to protect deposit,but this still seems unfair.It is usually far better to avoid court though,if you are starting from a weak position.

Hi, I just wanted to follow up. I have replied to them and I'm waiting for a response. I'll be back on the forum with developments as and when they happen.

By the way, I'm not sure what the outcome will be but I've heard that there may be a legal issue with charging x2 or x3 for subsequent breaches. I'm not going to go into detail yet but it is being looked into at the moment. I think there has been a significant rise in these claims and the letter of the law is being scrutinised more carefully than before.

The letter of the law is clear - you are liable for up to 3x for each tenancy or "subsequent breach"... what you will be depending on / hoping on (I think) is the spirit of the law.

Good luck anyway and thanks for the follow-up.

Hi, I just wanted to follow up on this and maybe give some idea of the potential outcome. I don't yet know the final outcome and may not for another 3 years or so when the 6 1/2 year term is up.

Anyway. I requested the solicitor provide proof of payment of the alleged deposit and they sent a copy of the tenancy agreement detailing the deposit amount. I replied stating that was not proof of payment and further that not only do they need to provide proof of payment but also the date it was paid, if at all, as they can't legally claim that you haven't paid into a deposit protection scheme within 30 days of receipt of deposit if they can't prove if and when it was paid.

I suspect the tenant kept records of the TA for housing benefit purposes but has binned the deposit received & returned paperwork as it was returned in full and didnt feel the need to keep hold of it.
That was the last letter I sent and it was posted in early February and I haven't heard anything further from them. Maybe thats the end of it, maybe not. Time will tell.

Thanks for the update.  Good luck.