Abortive letting: can L keep any of preliminary deposit?

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    Abortive letting: can L keep any of preliminary deposit?

    Hi - I would be grateful for some advice.

    Last week I agreed a letting of a room in a shared house under an AST Agreement (AST for room only). The tenant paid me the deposit which is equivalent to one month's rent. I explained this would be protected once he had moved in. He was due to to move in yesterday but did not attend the check-in appointment and now states he has changed his mind.

    Would I be entitled to keep some of the money paid on the basis that we had an agreement (AST not signed although he had been sent a copy) and I have lost a week's marketing as well as rent?

    Or, as nothing was signed, should I refund the entire deposit paid?

    Thanks.

    #2
    Originally posted by nuada View Post
    Hi - I would be grateful for some advice.

    Last week I agreed a letting of a room in a shared house under an AST Agreement (AST for room only). The tenant paid me the deposit which is equivalent to one month's rent. I explained this would be protected once he had moved in. He was due to to move in yesterday but did not attend the check-in appointment and now states he has changed his mind.

    Would I be entitled to keep some of the money paid on the basis that we had an agreement (AST not signed although he had been sent a copy) and I have lost a week's marketing as well as rent?

    Or, as nothing was signed, should I refund the entire deposit paid?

    Thanks.
    Jesus, the poor guy changed his mind and people are allowed to keep half the money. I guess "half the money" amounts to at least a couple of hundred quid as well.

    This is what makes the law so disgraceful, people are trying to find a roof over their heads and might not have much money as it is so it must be really tough times for them when they get their deposit withheld.

    If it was me I would just give all of it back bearing in mind SOMEONE is going to give you the deposit and you'll then at least have a clear conscience.

    I think you are entitled to keep the deposit but it's up to you, personally I wouldn't be able to live with myself but then I am a nice person

    Comment


      #3
      Originally posted by nuada View Post
      and I have lost a week's marketing as well as rent?
      SMR, don't you think that bit might be relevant?
      I also post as Moderator2 when moderating

      Comment


        #4
        Originally posted by nuada View Post
        Hi - I would be grateful for some advice.

        Last week I agreed a letting of a room in a shared house under an AST Agreement (AST for room only). The tenant paid me the deposit which is equivalent to one month's rent. I explained this would be protected once he had moved in. He was due to to move in yesterday but did not attend the check-in appointment and now states he has changed his mind.

        Would I be entitled to keep some of the money paid on the basis that we had an agreement (AST not signed although he had been sent a copy) and I have lost a week's marketing as well as rent?

        Or, as nothing was signed, should I refund the entire deposit paid?

        Thanks.
        Mr X paid no rent, did not sign a tenancy agreement, and did not move in. Therefore, no tenancy.

        Was there a signed agreement in respect of the deposit paid, stating what would happen to it in the event that the tenancy did not proceed? If not, then I don't think you're entitled to keep Mr X's money. Others may disagree.

        Comment


          #5
          There might have been no tenancy, but that does not automatically mean there was no contract or agreement and it is that at least that has been breached and accordingly the breacher is liable to pay compensation for any loss sustained.

          This always seems to me to be a stumbling block for tenants or prospective tenants. Before now I have travelled 120 miles return to see prospective tenants that either do not turn up or have changed their minds without seeing the property concerned. I bill them for lost time and fuel and sue if they dont pay (I always warn that I am travelling some distance to see them and wasted time will be charged for if they dont come to the appointment or are not there). A tenancy agreement can be parol - and the handing over of a deposit or rent advance is clear evidence of the intention to create a contract or agreement whether or not it is in writing at that time. Backing out leaving the other party high and dry - why should not compensation be paid?

          Comment


            #6
            I agree with DJB.

            Too often, prospective tenants take other peoples time/effort/resources for granted with no shows or change of minds at last minute, in the mistaken belief that it doesn't matter, and no courtesy to call well in time and tell you or apologise. If it cost them something, then they'd think twice before doing it again.

            smr,
            The LL has lost other potential Ts and has to start again. Its nothing to do with being nice. Its just business. nice ends up in lost time/rent/income and grief for the person on the receiving end.

            That has a lot to do with it.

            Comment


              #7
              Thank you

              Thanks for all replies.

              westminster - no, there was nothing in writing to apply to this situation. In my email correspondence I made clear that the money paid was as a deposit to be held for the duration of the tenancy in the TDS scheme.

              That was my reasoning in wondering if I should return the entire amount.

              davidjohnbutton & havensRus - yes this was my point. I am not wanting to rip anyone off (honestly smr!) but I have been messed about and have definitely lost out because of it. I stopped advertising and arranging viewings of the room as soon as I had agreed terms for a letting.

              I feel it would be reasonable to keep some of the money paid to cover lost rent/lost marketing time but am still not 100% confident I could legally do so if the other party disagrees.

              Comment


                #8
                discuss/agree with him how much you wish to deduct and pay the rest back. Get him to sign something b4 handing it back-to the effect that you'd agreed that amount and there's no comeback later.

                Comment


                  #9
                  My view is that you need to return the deposit. In order to keep it, the onus is on you to prove that there was some kind of agreement (not necessarily in writing) about the terms upon which the deposit was being paid (i.e. that you could keep some or all of it in the event that the tenant changed his mind and didn't take up the tenancy). From what you have said, there was no such agreement. The agreement was that the deposit paid was essentially an advance payment of the deposit that would have been payable under the tenancy agreement once signed. I agree its annoying when someone changes their mind at the last minute consider it a lesson learned for the future and move on.

                  Comment


                    #10
                    Originally posted by smr View Post
                    Jesus, the poor guy changed his mind and people are allowed to keep half the money. I guess "half the money" amounts to at least a couple of hundred quid as well.
                    I had a situation where a tenant told me that he would take up the tenancy when the existing tenants moved out in 4 weeks time. Three days before he was due to move in, he changed his mind. It then took me another 2 weeks to get in new tenants. His decision cost me 6 weeks and about £500 If he had been compelled to provide a non refundable deposit, he may have thought twice about wasting my time and money.

                    Comment


                      #11
                      Check if you have Complied with the Law

                      Hello
                      I thought that you must register the deposit within fourteen days of getting it, nothing to do with whether the tenant has moved in.

                      If you have had it for more than fourteen days and not registered it, you may not have complied.

                      Alan

                      Comment


                        #12
                        Originally posted by Jaybee542 View Post
                        I had a situation where a tenant told me that he would take up the tenancy when the existing tenants moved out in 4 weeks time. Three days before he was due to move in, he changed his mind. It then took me another 2 weeks to get in new tenants. His decision cost me 6 weeks and about £500 If he had been compelled to provide a non refundable deposit, he may have thought twice about wasting my time and money.
                        You had no gaurantee that your tenants would move out in 4 weeks time how much non refundable deposit would you be offering your tenant to be?
                        Dial 999 For a Landlord

                        Comment


                          #13
                          Originally posted by ohdearme View Post
                          Hello
                          I thought that you must register the deposit within fourteen days of getting it, nothing to do with whether the tenant has moved in.

                          If you have had it for more than fourteen days and not registered it, you may not have complied.

                          Alan
                          Is there any argument that I have to register the deposit, since the tenancy never commenced?

                          Comment


                            #14
                            Originally posted by Krispy View Post
                            You had no gaurantee that your tenants would move out in 4 weeks time how much non refundable deposit would you be offering your tenant to be?
                            None. Theres a difference between not being able to complete for no fault of your own and simply changing your mind once you have sat on an agreement for 4 weeks. The agreement I made with the tenants was always subject to the existing tenants moving out first - they knew that. I, on the other hand, had no way of knowing that they would simply be flakely and change their minds.

                            Comment


                              #15
                              Originally posted by nuada View Post
                              Is there any argument that I have to register the deposit, since the tenancy never commenced?
                              No. Deposit protection only applies to Assured Shorthold tenancies. No AST, no deposit protection required.

                              Comment

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