Tenant's Deposit

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    Tenant's Deposit

    We were managing a letting agency for the owners as we were taking over the business. We have a flat that we let and were managing ourselves after the agents had left the business. As we were taking over the existing landlords we put our own tenant's deposit into the agency's deposit account. Now everything has fallen through and we are no longer taking over the business, the agents have passed the landlords over to another estate agent to manage but they are keeping hold of the deposits themselves (around £8,000) and say they wont hand them over unless a tenant leaves the property or requests it themselves. They are holding onto our deposit even though they were never even managing the property. I think they are doing this out of petty spite because we ended up not buying the business from them. We also organisied a gas certificate for our flat during our time there and this has been sent to the agency. When I emailed the agent requesting the deposit, he said that the bill for the gas certificate would be deducted out of the deposit before it was handed over. I told him to send the bill and the gas certificate to us and the deposit and we would pay our own bill as they were not and never had been managing the property. We have had no response from them and no gas certificate or deposit. This all fell through around 3 weeks ago and now the agents are going to America for a month tomorrow. Any advice on who should recieve the deposit. Us as landlords or the tenants? Also how can we force the agent to even hand it back?

    #2
    boo

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      #3
      You did what?

      For a letting agent your question is extremely jumbled, so I hope your command of letter writing is a bit better if and when you do acquire an agency.

      I have some questions of my own:
      1. Did you contact your local Business Link office through your Local Authority?
      2. Did you take any legal advice about what you were doing?
      3. Did you sort out the structure of what you were going to do and have all the terms and conditions of the takeover in a written agreement first?
      4. If you took a deposit and paid it into an account over which you were not going to have any subseuqent control then why?
      5. Did you draw up a new terms of business with the new landlord, charging structure etc., and did you do so with all landlords you were proposing to "take over".
      6. Did you get any of the exisiting landlords to give you written authority to manage their properties after you were to take over the business?
      7. Did you go through this transfer with a fine tooth comb to iron-out any anomalies that might arise after the transfer?


      I could go on but you can see from where I'm coming. If you didn't do much of the above first then I would probably advise you to stay away from running a business until you have gained enough experience as to how to.
      The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

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        #4
        The reason my post seemed jumbled was because I was trying to put in all the facts in a shorter version so as not to bore anyone with the full details. Sometimes its easy to make grammatical errors when you are rushing and 'telling it like it is' My command of letter writing is quite adequate as I have a diploma in English for Business in which I gained a distinction, a Diploma in Business Administration, NVQ4 in Business Startup and an ILEX Diploma and many other qualifications which I wont bore you with.

        The take over was all legal and above board and yes we had solicitors drawing up the contracts.

        The reason I foolishly put my own tenants deposit into the agency's deposit account was because we were taking over the bank accounts as well. So I though it would be safe to do so.

        All landlords were already contracted to the company that we were taking over so we had no need to get their written permission to manage their properties. We did speak to them on the phone and they were quite happy for us to take over the management of their properties and in some cases they we actually pleased the company was being taken over.

        As I said, the owners left the company for us to run prior to the take over, that is when we saw for ourselves that things were not as we had been led to believe and without going into detail we offered a revised price for the business. The wife of the partnership agreed to this price but her husband came back over night and stripped the office leaving us unable to work. They passed all tenants files over to another agent who is managing the properties for them, free of charge for some strange reason, but as I said they have not passed over any deposits to the new agent including my tenant's deposit.

        In answer to your last comment. Myself and my partners have plenty of experience in running a business, and we are already up and running our new business and have gained back most of the landlords from the previous agent of the business that we were taking over.

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