Agent using Deposit for fees

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    Agent using Deposit for fees

    Hi All,

    Can anyone offer any advice here?

    As a landlord I signed up with an agent for a tenant finding service 3 years ago and duly paid them a fee said thank-you very much and we went our separate ways. The only remaining contact was using the deposit holding scheme.

    My tenant has just moved out and I went to them to get the deposit back. As this stage they said there were outstanding fees. I queried what these were and was told that I had agree to pay 10% of the annual rent every year and these had never been received.

    I informed them that I never knew this and asked why I hadn't been billed and had no contact with them in the last 3 years etc and was told they thought the tenant had moved out years ago!!

    Now they wont release the deposit back to me (which I have already repaid to the tenant as they needed it to get a new place!)

    They are stating that as the deposit has been released to us it is no loner a deposit and as such they have snatched the amount to leiu of fees.

    What are my options here?

    #2
    The deposit does not belong to you or the agent.

    The deposit belongs to the tenant, no ifs, ands or buts,
    less any damages / unpaid rent etc.

    The agent has stolen the tenants money, and that is a crime.

    Comment


      #3
      Originally posted by ram View Post
      The deposit does not belong to you or the agent.
      OP said that he already repaid the deposit to the tenant.
      So it's really an issue of debt between OP and agent.

      Bluebaron: What does your contract with agent state?

      Comment


        #4
        Hi JJlandord,

        I don't have a copy sadly as I thought my business with them concluded 3 years ago.

        However they showed me a printed sheet of A4 where it had been handwritten on stating 10% of annual rent paid 6 monthly. I had a recent tenant finding service with another agent where I paid £750. This was only £600 so a nice saving for me. Didn't realise they were going to charge me £600 every six months forever for doing nothing!

        Comment


          #5
          I am inclined to agree that the sum held by the agent is no longer a deposit. The tenant has got his money back and not entitled to anything further.

          The agent is going to have to prove that the continuing commission clause was drawn to the OP's attention. The fact that it was added in handwriting is not going to help the agent. I can imagine a judge raising his eyebrows very high.

          I suggest the OP sends a "pay or be sued" letter.

          The OP is to be commended for the swift return of the deposit. It is a pity that that action has led to his current problem.

          Comment


            #6
            I am sorry to hear you've had such a bad experience.

            Originally posted by bluebaron View Post
            I informed them that I never knew this and asked why I hadn't been billed and had no contact with them in the last 3 years etc and was told they thought the tenant had moved out years ago!!
            What the agent says here makes no sense at all. If he really did think that the tenant had moved out years ago, (i) surely he would have thought it odd that no one had ever asked for the deposit back and (ii) surely if he was legitimately taking 10% of the rent then he would always expect to produce a final bill on a tenant's departure? I imagine that if it came to court you could use this to suggest that the agent is trying to pull a fast one on you....

            Also, the other question which immediately comes to mind is what type of tenancy deposit protection scheme was the deposit in? Presumably it would have been insurance-based rather than custodial, based on the above.

            Comment


              #7
              Thanks for the advice folks.

              I have spoken to the tenant and told them I can no longer honour my agreement to pay them directly and that they have to get the deposit back form the agent directly. They may of course argue that the deposit has already been signed over to me but the tenant will counter-argue that he did that in good faith of getting the money form me!

              Then if the agent still thinks I owe them money for doing nothing for 3 years then they can sue me. I am quite happy that I have a strong case in my defence.

              Comment


                #8
                Originally posted by bluebaron View Post
                Then if the agent still thinks I owe them money for doing nothing for 3 years then they can sue me. I am quite happy that I have a strong case in my defence.
                I lay decent odds that they won't trouble you further!
                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.

                Comment

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