UK Landlord Forum / Life

I allowed a friend of a friend to stay in my flat whilst I was overseas - this was initially intended to be only for a period of a few months but ended up being nearly a year. In the spirit of the relationship, i.e that he had been recomemmended by a freind,  the 'agreement' that was entered into was merely documented in emails and no ASTA was ever drawn up or requested by either party. At the commencement of the 'agreement' the tenant paid me a month's rent in advance and also a 'deposit' amounting to one month's rent.  The tenant moved out last month but before doing so requested that I utilise the 'deposit' monies held as payment for the last few weeks rent that was due - i agreed to do this and as the tenant had moved out before the end of the month it left a balance of some £200.  Upon moving back in to the property I noted damages that amounted to in excess of £200 - the tenant stated in a text that I should deduct this from the 'deposit' but I in turn stated that the monies that I held were insufficient to cover everything.  The tenant has now said that he will sue me for not having lodged the deposit in a TDS; my understanding was that, because an ASTA was not in place, I was not under any obligation to protect the deposit. Please could you clarify the situation. Thank you
PS this isn't a 'one post wonder' - I have two properties that I let out on ASTA's and am always willing to offer others support based on my experience where possible. Sadly, the above scenario is not one of my better experiences!

Tenancy doesn't have to be in writing or as an AST.  Deposits have to be protected.  Sorry to be the bearer of bad news. 

I read this... https://www.depositprotection.com/legislation ...and wonder what grey area, if any, might exist. In my mind, also, a deposit is a deposit and must be protected. A tenancy exists even if not in writing, that's for sure, but is that tenancy "under an AST" if there is no accompanying documentation? If the answer is "yes" then what AST is it under exactly? My common sense is telling me it can't be under any AST... does, then, deposit protection legislation not apply?

I conducted some research into the matter prior to posting and did wonder whether the absence of an ASTA did in fact mean that it would preclude the need to register the deposit.  There was an article on Issued Assured Tenancies but it was a little confusing and seemed to suggest that they were no longer relevant.  I note that other 'tenancy agreements' are exempt from having to ustilise a TDS, such as holiday let and wonder why this is or whether this could be used.  Surely there has to be some definition as to the type of agreement?

If it's not an AST (no fixed term) then surely it starts life as just a periodic tenancy?  The deposit protection doesn't cover an AST, it covers both AST's and periodic tenancies, so why wouldn't it apply to this circumstance I wonder?  Not saying I'm 100% dead certain.

All the information that is requested by the deposit scheme doesn't seem to need it to be an AST.  Just the standard prescribed information items.  When it started, monthly rent amount, tenant details etc etc.

Quote from: Hippogriff on April 23, 2015, 04:59:18 PM
I read this... https://www.depositprotection.com/legislation ...and wonder what grey area, if any, might exist. In my mind, also, a deposit is a deposit and must be protected. A tenancy exists even if not in writing, that's for sure, but is that tenancy "under an AST" if there is no accompanying documentation? If the answer is "yes" then what AST is it under exactly? My common sense is telling me it can't be under any AST... does, then, deposit protection legislation not apply?

That link got me thinking and yes this part in particular "Who is affected?  The legislation covers virtually all new AST contracts" which mentions an AST contract.

I then thought I'd see what the definition of an AST actually is and wonderful wiki gave this

"The assured shorthold tenancy is the default legal category of residential tenancy in England and Wales. It is a form of assured tenancy with limited security of tenure, which was introduced by the Housing Act 1988[n 1] and saw an important default provision and a widening of its definition made by the Housing Act 1996.[n 2] By the widespread agreement of tenancies since 28 February 1997 in respect of accommodation to new tenants who are new to their landlords, the assured shorthold tenancy has become the most common form of arrangement that involves a private residential landlord"

So an AST it seems is the default category of someone renting a residential property from someone, with no mention or apparent need for a formal written contract.

Thoughts?

I had looked at the same link as part of my research and felt it to be a grey area in terms of the definition because, contractually, an assured tenancy is different from an assured shorthold tenancy. I asked a solicitor friend of mine - not a property specialist though - and these were his thoughts:

"In my opinion there is an implied contract there. He (Steve) has sent an email confirming the let and receipt of monies including a deposit. He (Steve) was also accepting regular monthly payments as rent. If it went down the legal route and an AST was implied by his actions then legally yes he would be in breach if the deposit had not been registered. "

I'm still  not connvinced that an ASTA could be implied, any further thoughts please?

if it looks like a duck, walks like a duck and quacks like a duck.

No contract implies an AST is in place, as indeed it would if you tried to get a contract signed which was unfair.

Wouldn't you just be happier letting sleeping ducks lie, and just move on, keeping your loss where it is?

It's as grey an area to us as it is to you. Obviously a tenancy exists. I'd say a contract also exists. Saying the tenancy "is under an AST" is the bit I have trouble with. To me an AST is the document that both Landlord and Tenant sign which outlines the responsibilities and obligations of each party. You say you don't have this... which blows my mind also. I wouldn't want it to go to Court, I know that much.

Clever man covers it all here

http://www.propertyinvestmentproject.co.uk/blog/tenants-without-a-written-contract/

Just taken your advice BOBOFF and followed the link you provided, thank you.

Without wanting to hijack this thread, would the same rules apply to a verbal contract regarding a semi detached garage? I can start my own topic if preferred.

I would still question whether the agreement falls under the law governing deposits - I agree that the 'agreement', verbal or email, can be construed as a tenancy agreement but on the basis that some tenancy agreements, such as holiday lets, company lets etc do not require the landlord to protect the deposit then who is to say they the 'agreemet' is actually an ASTA or one that requires the deposit to be protected?

Quote from: Steve on April 26, 2015, 09:05:46 AM...who is to say they the 'agreemet' is actually an ASTA or one that requires the deposit to be protected?

A Court.

Let us know how it works out - even if you capitulate and settle before Court - because I am positive that some of us here are very interested.

Oh Steve you are so old fashioned mate.

Yes there was a time when you could argue, like Rumpole of the Bailey some technical point of law, and win!

But now you cant, live with it, give him his money, and forget all this "yeah but, yeah but" it wont work, take that advice if you will, if you choose to ignore it, please as Hippo says, come back and tell us how much it cost you, and so we can all say told you so....

Thanks

Quote from: Steve on April 26, 2015, 09:05:46 AM

I would still question whether the agreement falls under the law governing deposits -

I think you're bring silly now.  Here is a list of those exempted from deposit protection.  Unless you can categorically say that someone living in a property of yours in exchange for money is one of these, you haven't got a leg to stand on.

So,

resident landlords (those living in the property) - did you live at the property?
landlords of tenancies with rent of over £100,000 a year - was the rent more than 100K?
company lets - Were you letting to a company?
student accommodation let directly by universities or colleges - Was it?

I let a property to a company, but I still protected the deposit. Served the PI and everything... sucka! I knew what I was doing too.

Quote from: Hippogriff on April 26, 2015, 08:57:20 PM
I let a property to a company, but I still protected the deposit. Served the PI and everything... sucka! I knew what I was doing too.

Haha you did ALL that work for nothing.  What a waste of time.  How long did it take?

It must've been, like, 15 to 20 minutes of my time... I could kick myself, for sure, but I figured I'd just have all the deposits in the same place... that being DPS Custodial. Hitting "print" a couple of times is no biggie and I sign my name a lot anyway, so doing it twice more wasn't that bad.

If in doubt... protect the deposit!

Quote from: Hippogriff on April 27, 2015, 03:50:37 PM
It must've been, like, 15 to 20 minutes of my time... I could kick myself, for sure, but I figured I'd just have all the deposits in the same place... that being DPS Custodial. Hitting "print" a couple of times is no biggie and I sign my name a lot anyway, so doing it twice more wasn't that bad.

If in doubt... protect the deposit!

I was kidding.  Thats definitely best practice.

As we know, deposit protection is nothing to kid about.