What are my chances here of claiming 1-3x compensation from my letting agent?

[Oliverb93]

Hello all, apologies for the long message that follows. I have highlighted the bits in bold I feel are vital to the answering of my question (contained in the title above):

So we think we may have a potential claim with regards to our tenancy deposit (total deposit value £4320). I entered onto the tenancy for a 4-bed London property through a change of occupancy process in September 2017 (for a 3 year tenancy ending in April 2018). This was a property that contained 4 tenants on a joint and several liability AST. Upon moving in I signed a letting agent's form to say I had bought out the share of the deposit (£1080) of the tenant I was replacing, which I had done. The letting agent told me via email that this share of the deposit (£1080) would be reassigned to my name on the TDS; however, it took them 5 months to update the TDS system and issue me a certificate. My question here is therefore whether not updating tenants details on the certificate the same as not protecting money (i.e. the full deposit was protected in the scheme at this point as it was mid-tenancy, but this money was recorded as belonging to someone else for those 5 months)? Furthermore, neither myself nor the other two tenants that entered through the same change of occupancy procedure were ever provided with the "what is the tenancy deposit scheme" leaflet following our arrivals in September 2017. We were however provided with the other part of the prescribed information this leaflet was meant to be attached to (i.e. the information was incomplete). This tenancy came to an end in April 2018.

This tenancy was then renewed for a term of 3 years and names were changed on the tenancy agreement. Myself and one other tenant stayed on whilst two tenants departed. Despite these two tenants departing, the letting agent 'rolled over' the deposit from the first tenancy onto the renewed 3-year tenancy by simply extending the end date on the TDS certificate by 3 years. The effect of this was that there were 4 names on the TDS certificate for a tenancy agreement which contained only 2 names. Consequently, the two tenants who did not sign the new tenancy agreement had had their deposits re-secured against a tenancy they were no longer a part of, and did not receive any of this deposit back (and still have not done). The letting agent’s response was that myself and the other tenant that renewed would have to find two further tenants to 'buy out' this deposit, or buy it out ourselves. This process was never agreed to by the outgoing tenants, was not explained prior to the renewal, and nothing was signed to consent to this. Again, following renewal, and despite the names on the tenancy agreement changing, the "what is the tenancy deposit scheme?" prescribed information leaflet was not sent to us. In this case the letting agent said it was attached to the email they sent, buut it was not - they had clearly just forgotten to attach it this time.

This renewed tenancy was terminated early just a month later as the two tenants that stayed on (myself and my friend) had also not been made aware that we were signing a 'jointly and severally liable' tenancy (this term was not explained to us verbally and all verbal discussion up until this point had suggested that we would be only liable for a quarter of the rental value each; the letting agent was clearly rushing us through the process just to secure their fees. Had the deposit situation been dealt with properly, we would have realised that this was the case as they would have had to ask us to buy out the deposits of the remaining tenants beforehand (and we would not have renewed if they had). This ultimately led to the tenancy being terminated as we were being forced to pay four people's rent between two of us which we were simply unable to pay.

The letting agents handling of the deposit really has been the tip of the iceberg with regard to our experiences with them. If there is a potential claim for compensation here, and in light of the horrific experiences we have had with the letting agent, we would be looking to take this further. Does anybody who has heard of similar scenario's, or been through anything similar, have any thoughts on our chances of successfully doing so or advice? Thanks!

[JK0]

Hmm. Frankly I'm not surprised the agent got in a muddle.

Why not approach one of the shyster lawyers who advertise 'no win, no fee' for deposit claims. If they can make sense of the above, good luck to them.

However, bear in mind that the more tenants take advantage of foul-ups like this, the more likely landlords will be to not take a deposit at all, and just charge extra rent. (That's what I do.)

[jpkeates]

The chances of claiming a penalty are remote.

The change of tenant process is almost impossible to get right - the agent is essentially taking a huge short cut, as assigning a joint tenancy is really very hard to get right.

The idea that you can "buy" a share of a deposit is hard to square with how deposits work otherwise. In a joint and several tenancy, there is legally only one tenant and, therefore, one deposit. The notion of a deposit "share" works counter to that - in the same way that you had an issue with the joint and several liability for all of the rent, not your part of it.

It would be great to try, if only because the mess you have experienced is common (it was London wasn't it!).

But, on a practical level, the agent could defend any claim on the procedural basis that any claim based on a joint tenancy should be made by all of the joint tenants, which is going to be impossible in this case.

[KTC]

Let's start with the second tenancy first.

This tenancy was then renewed for a term of 3 years and names were changed on the tenancy agreement. Myself and one other tenant stayed on whilst two tenants departed. Despite these two tenants departing, the letting agent 'rolled over' the deposit from the first tenancy onto the renewed 3-year tenancy by simply extending the end date on the TDS certificate by 3 years.

...

This renewed tenancy was terminated early just a month later as ...

Did the tenancy end less than or more than 30 days from it beginning? If more than 30 days, then I say the two of you who are tenant in this tenancy clearly has a case.

The tenant on the new tenancy is not the same as the tenant on the old tenancy when it was ended however one look into that assignment earlier on, so the new tenancy is not a replacement tenancy. So all the requirements for deposit protection and prescribed information were required afresh.

Now the first tenancy which is a bit (lot) more complicated.

Was that in legal reality an assignment or a surrender and re-grant? If the agent/landlord got it right and it was an assignment, then I say you've missed your chance at taking the agent/landlord to court as they've since put it right and the tenancy has ended since you would be suing them on the basis that the deposit is not currently being hled in accordance with the scheme they told you about, rather than them not complying within 30 days of deposit being received.

If in reality it was a surrender and re-grant, then that's a new tenancy and you four would have a case.

You need a specialist with access to all the information about what happened to advise you on your chances and how to proceed from here.

[Lawcruncher]

In a joint and several tenancy, there is legally only one tenant

This idea seems to have come to the fore recently. Does anyone have any authority for the proposition? If it is true, I do not see how it is that one of joint tenants can give a notice to quit. Saying that a joint tenancy is a single tenancy does not imply there is only one tenant, nor does the fact that some actions e.g. assignment, require all the tenants to join in.

...and, therefore, one deposit. The notion of a deposit "share" works counter to that - in the same way that you had an issue with the joint and several liability for all of the rent, not your part of it

Whatever the position on the first point, the deposit is separate from the tenancy. Bear in mind for a start that a deposit can be paid by a third party. There is nothing preventing each tenant from paying his own deposit or only one tenant paying the deposit. Of course, how it is in fact treated may come down to what the documentation says.

[jpkeates]

This idea seems to have come to the fore recently. Does anyone have any authority for the proposition? If it is true, I do not see how it is that one of joint tenants can give a notice to quit. Saying that a joint tenancy is a single tenancy does not imply there is only one tenant, nor does the fact that some actions e.g. assignment, require all the tenants to join in.

Hammersmith & Fulham v Monk 1990 is the source that one of the joint tenants in a periodic tenancy can give notice that ends the tenancy for all of the joint tenants. Otherwise the contract could be endless, which can't have been the tenant's intention when signing. That decision hasn't been extended into a fixed term as far as I can tell.

As for the "legally only one tenant", I was taught that as a given (and don't have any authority for it - which is interesting now I come to see it questioned).
It might be a shorthand that I should avoid, but essentially the joint and several tenancy creates a distinct legal entity, which is "the tenant" as distinct from the individuals making up that entity.
It seems to me that it must follow, though, otherwise how can several people have exclusive control of a property?

Whatever the position on the first point, the deposit is separate from the tenancy. Bear in mind for a start that a deposit can be paid by a third party. There is nothing preventing each tenant from paying his own deposit or only one tenant paying the deposit. Of course, how it is in fact treated may come down to what the documentation says.

The legislsation refers variously to "a deposit" and "the deposit". The section relating to a third party refers to "the deposit". It would take a lot of wriggling to infer a "singular also means the plural" reading.

[Oliverb93]

Thank you for all your responses so far, it certainly isn't a straightforward situation at all but i'm convinced some wrongdoing has taken place; there are currently 4 of us negotiating a deposit return for a tenancy that only contains two names which seems ridiculous enough in itself.

But, on a practical level, the agent could defend any claim on the procedural basis that any claim based on a joint tenancy should be made by all of the joint tenants, which is going to be impossible in this case.

Would this definitely be a barrier to a claim on a joint and several AST? Surely the same rules would apply to bringing a claim as would apply to terminating the tenancy as highlighted above, in that one named tenant can act on behalf of all others. I'm also wondering why you consider this to be impossible in this case? What if the other 3 tenants on the most recent TDS certificate agreed to this?

Did the tenancy end less than or more than 30 days from it beginning? If more than 30 days, then I say the two of you who are tenant in this tenancy clearly has a case.

The tenant on the new tenancy is not the same as the tenant on the old tenancy when it was ended however one look into that assignment earlier on, so the new tenancy is not a replacement tenancy. So all the requirements for deposit protection and prescribed information were required afresh.

It ended about a month and a half after it started so yes, in excess of the 30 days.

From my understanding it seems that the failure to issue the full prescribed information seems to me like their most clear-cut breach of the law. I also read somewhere that it should not make a difference that the tenancy has ended with regard to the PI requirement (i.e. a claim for failure to provide this in full can be brought up to 6 years after the offence). Therefore, regardless of whether or not the money was protected properly, does anyone have an opinion on whether it would be likely that the failure to supply this information in full at renewal is a breach of their duty? What about their failure to re-issue this information in full to all replacement tenants when we first entered onto the tenancy through the deed of assignment? Thanks!

[KTC]

A claim for a deposit protection penalty must be made with the agreement of all joint and several tenant, unless the court give permission otherwise. This is normally done by all of the tenants being joint as claimant.

The list of tenants for the 2nd tenancy is two not four of you.

It ended about a month and a half after it started so yes, in excess of the 30 days.

From my understanding it seems that the failure to issue the full prescribed information seems to me like their most clear-cut breach of the law. I also read somewhere that it should not make a difference that the tenancy has ended with regard to the PI requirement (i.e. a claim for failure to provide this in full can be brought up to 6 years after the offence). Therefore, regardless of whether or not the money was protected properly, does anyone have an opinion on whether it would be likely that the failure to supply this information in full at renewal is a breach of their duty? What about their failure to re-issue this information in full to all replacement tenants when we first entered onto the tenancy through the deed of assignment? Thanks!

Yes, it doesn't matter if the tenancy has ended or not. However, the ground to sue the former landlord is either basically (a) the landlord failed to protect the deposit or give the prescribed information within 30 days of receiving it, or (b) "that [the tenant] has been notified by the landlord that a particular authorised scheme applies to the deposit but has been unable to obtain confirmation from the scheme administrator that the deposit is being held in accordance with the scheme".

(a) is not fixable by the landlord once breached. (b) probably is so if they had put it right before proceedings, you can't win.

(a) applies to your second tenancy, (b) would applies to the first tenancy if the tenancy was correctly assigned and it wasn't a surrender and re-grant.

Did the landlord give you the information again for the second tenancy, or did they rely on the fact that you were given information before? If the latter, that's even better for you.

If you are confident that they have failed to give you all the required information for the 2nd tenancy, then yes you should win a penalty.

[jpkeates]

Thank you for all your responses so far, it certainly isn't a straightforward situation at all but i'm convinced some wrongdoing has taken place; there are currently 4 of us negotiating a deposit return for a tenancy that only contains two names which seems ridiculous enough in itself.

Some wrongdoing may be stretching things, but the agents have messed up big time.

As far as I can tell, the final tenancy contains only two people as joint tenants. If there is a deposit for that tenancy, the previous tenants have no claim against it, and should try and recover the money from the agent, who has misplaced it by applying the funds as a deposit to your new tenancy.

Would this definitely be a barrier to a claim on a joint and several AST? Surely the same rules would apply to bringing a claim as would apply to terminating the tenancy as highlighted above, in that one named tenant can act on behalf of all others. I'm also wondering why you consider this to be impossible in this case? What if the other 3 tenants on the most recent TDS certificate agreed to this?

It would be the two people on the last two tenancies who would sue, the previous tenancies are part of the story, not part of the claim.

From my understanding it seems that the failure to issue the full prescribed information seems to me like their most clear-cut breach of the law. .... Therefore, regardless of whether or not the money was protected properly, does anyone have an opinion on whether it would be likely that the failure to supply this information in full at renewal is a breach of their duty? What about their failure to re-issue this information in full to all replacement tenants when we first entered onto the tenancy through the deed of assignment?

It's an issue, but it's not the most serious problem - the failure to protect within 30 days is the serious issue - and given that the agent can't now return the deposit, that's where I would focus. The agent could serve the PI now and that wouldn't be a problem any longer.

The agent have made such a mess of this, I would probably see a solicitor (with the other tenant if possible) and pay them to write a letter to the agent demanding the return of the deposit to you. The agent might just consider paying the issue to go away.

[Oliverb93]

Did the landlord give you the information again for the second tenancy, or did they rely on the fact that you were given information before? If the latter, that's even better for you.

If you are confident that they have failed to give you all the required information for the 2nd tenancy, then yes you should win a penalty.

Thanks again for the input. They emailed us a tenancy agreement within which was contained part of the prescribed information. Within this prescribed information it says that a leaflet entitled "what is the tenancy deposit scheme?" needs also be supplied to us otherwise the information is incomplete. However, the letting agent forgot to attach this leaflet to their email (despite saying in their message it was). They also sent us over a TDS certificate with the wrong names on. Neither of these mistakes were rectified within 30 days. The following is from the TDS:

If the tenancy rolls over into a new fixed term AST or a statutory periodic tenancy there is no need to re-issue the Prescribed Information as long as:

• The deposit was properly protected and Prescribed Information served at the start of the original tenancy;
• The property let remains the same;
• The tenant(s) remain the same;
• The landlord(s) remain the same;
• The deposit protection scheme used remains the same.

In the event that any of the above conditions do not apply the deposit needs to be protected and the Prescribed Information served within 30 days of the tenancy change. Failure to serve the Prescribed Information within the correct timescale will be a breach of the Housing Act 2004 that could expose the landlord and/or deposit holder to legal action for compensation by the tenant and/or the relevant person. The Prescribed Information may be attached to the tenancy agreement, or served as a stand-alone document. Where the member receives the deposit at the same time as the tenancy agreement is signed, the member is recommended to attach the Prescribed Information to the tenancy agreement. The Prescribed Information includes the scheme leaflet What is the Tenancy Deposit Scheme? This can be downloaded from our website www.tenancydepositscheme.com, and it must be given to the tenant and any relevant person as part of the Prescribed Information. The Prescribed Information is incomplete without this leaflet.

From the above it seems the fact that the tenants changed and the What is the Tenancy Deposit Scheme? leaflet was not sent over within 30 days is grounds enough to seek a penalty claim of 1-3x deposit value. I know this seems to be trying to catch them out on a technicality, but the requirement seems pretty black and white in this area. As they are a large London letting agent (who I believe can be sued rather than the landlord in cases such as these) I would have absolutely no moral issue with pursuing this and, considering the mess they've left us in, I would jump at the chance to do so. Please let me know if i'm mistaken in any part of my assessment here. In the meantime I think i'm going to seek input from a solicitor.

[KTC]

Your claim in relation to the second tenancy would be that the deposit was not dealt with in accordance with the initial requirements of an authorised scheme within the 30 days limit, i.e. it wasn't protected at all because what protection they have was for a tenancy of 4 tenants etc. Additionally, whether the deposit was protected or not, the landlord (definition including the agent) fail to give the full and correct prescribed information.

Yes, you can sue the agent, especially if they're the one who's you've been dealing with.