Can a deposit be used by LL to pay unpaid utility bills?

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    Can a deposit be used by LL to pay unpaid utility bills?

    My tenancy agreement says:

    The Deposit shall be security for the Landlord for....
    ......
    any unpaid accounts for utility charges. The Landlord shall be entitled to discharge such accounts on behalf of the tenant.


    and

    The Deposit shall not be returned until the landlord has received satisfactory proof that all utility charges have been fully paid by the tenant.

    I didn't think that landlords were responsible for a tenant's unpaid bills? So is a LL really allowed to deduct from the deposit to pay them?

    #2
    Any relationship between you and utility suppliers is nothing to do with the landlord.

    In addition, you don't have to show proof of the state of this relationship to your landlord to get your deposit back, so don't.

    If your landlord makes a deduction in this respect, dispute it with the deposit scheme you're with to get it back.

    Comment


      #3
      And of course as we all know the utilities companies have never ever made any mistakes with their billing.
      I also post as Moderator2 when moderating

      Comment


        #4
        Originally posted by obiwan View Post
        I didn't think that landlords were responsible for a tenant's unpaid bills? So is a LL really allowed to deduct from the deposit to pay them?
        Presumably this would only be an issue if you were intending to default on your utility bills... if you aren't, then why are you concerned about the clause; if you are, then I have no sympathy with you!

        Comment


          #5
          So in a situation where a tenant (or ex-tenant) has a dispute with the utility company over a bill that the tenant believes is incorrect, it’s OK for the landlord to come along and pay the bill from the deposit?
          I also post as Moderator2 when moderating

          Comment


            #6
            Originally posted by Mars Mug View Post
            So in a situation where a tenant (or ex-tenant) has a dispute with the utility company over a bill that the tenant believes is incorrect, it’s OK for the landlord to come along and pay the bill from the deposit?
            No, fair enough...

            Comment


              #7
              Originally posted by Ericthelobster View Post
              Presumably this would only be an issue if you were intending to default on your utility bills... if you aren't, then why are you concerned about the clause; if you are, then I have no sympathy with you!
              Don't worry Eric, I was just curious...

              Comment


                #8
                The advice from the National Landlords Association and my solicitor is that a landlord is perfectly within his rights to pay outstanding utility bills from a deposit. This is frequently written into tenancy agreements anyway, and it's a disgrace how many tenants leave unpaid bills at rented properties and disappear, thinking they can get away with it. Why else would Thames Water propose, in the recent review of water metering charges, that landlords should be held responsible for any bills at a property? Thames Water clearly have a problem with unpaid bills, and the recent revelation that criminals, including people with CCJs against them, owe the courts £1.3 billion, just shows how many people are evading their responsibilities.

                As a landlord I would pay the bill, and if the tenant has a problem, they can sue me. If the tenant genuinely thinks the bill is wrong, they can continue to take it up with the utility company and get a credit back later. However it's all too easy for someone to say "the bill's wrong" with no justification, just to try and avoid paying the bill. I say shame on such people.

                Comment


                  #9
                  As agents this clause is added to the agreement re the utilities as you would be surprised how many tenants vacate the property without settling their final bill.

                  The agent or landlord will take meter readings prior to you entering the property and should mark these on the inventory. On exiting the property it is your responsibility to take the final reading and pay prior to vacating. Unless you have provided proof of your forwarding address to continue on your payment plan.

                  Yes utility companys do on a regular basis get things wrong, however if it were to get to a stage where the tenant hadnt paid any (which does happen) we reserve the right to deduct from the deposit as otherwise the ll will be liable for reconnection charges etc.

                  If you get to a stage where you are unhappy about the service provider you use ask permission from ll/agent to change.

                  The easiest way to ensure that you are covered when you vacate is to take all your paid bills to the ll/agent when you return your keys.

                  Comment


                    #10
                    Matchmade,

                    Did you correspond directly with the NLA or is the bit about taking unpaid utilities from a deposit on their website. Would be really grateful if you could let me know. I'm a landlord in a similar situation.

                    Thank you

                    Comment


                      #11
                      Originally posted by Greenwalls View Post
                      Matchmade,

                      Did you correspond directly with the NLA or is the bit about taking unpaid utilities from a deposit on their website. Would be really grateful if you could let me know. I'm a landlord in a similar situation.

                      Thank you
                      Greenwalls, Matchmade refers to advice given, which may not actually be written down.

                      I think the closest you will find to this in the NLA bumf is in their Landlord Development Manual, section 3.3.2 on legitimate witholding of part or all of deposit. It makes mention of "failure of the tenant to arry out obligations set out in the tenancy agreement such as cleaning" as well as "outstanding debts attached to the property". If tenant has left without paying the water bill attached to the property, then it is legit to use the deposit to cover that. By extension, if tenant has not carried out obligation to pay all utility bills, deposit can be used to cover that.

                      I find that tenants who have been trouble are the ones who leave unpaid bills. There's usually dilapidation, unpaid rent etc., which would have eaten into the deposit anyway. I've not attempted to pay such outstanding bills, and have usually just returned the letters to the relevant authority and informed them of the ex-tenant's departure, give a forwarding address (if I discover one), and let them get on with the chase. Usually when a new tenant moves in, the utility companies want to see the new AST etc.etc. before opening an account for the new T.

                      Strangely enough, when I report a departure, some will ask for the AST of the departed tenant-in their words-"to prove when the T left". I've stopped trying to educate them about the error of that thinking!!

                      Comment


                        #12
                        How realistic is it for tenants to pay their utilities, and get proof of it on their leaving day?

                        Until they physically leave (and they don't have to until midnight) the final reading can not be taken. Now a tenant may be willing to phone the utility company, give them the reading and ask if they can pay by debit/credit card - but is that a reasonable thing to request? We have all 'moved', we know the hassle factor, and imposing a pointless obligation on the tenant is unfair (imho).

                        The contract for utilities is between tenant and utility company - let them sort it out between themselves.

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