Deposit scheme

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  • Deposit scheme

    Having returned in full within 4 days of departure my tenants deposit they are now saying they can take me to county court as I did not put it in a protected scheme and did not pay the 8% interest? Is this possible even although it has been returned?
    Thanks

  • #2
    Originally posted by Lavers69 View Post
    Having returned in full within 4 days of departure my tenants deposit they are now saying they can take me to county court as I did not put it in a protected scheme and did not pay the 8% interest? Is this possible even although it has been returned?
    Thanks
    It's greedy nonsense. It is true that you should have protected it (alhtough there is no legal requirement to pay any interest - the DPS is free to use, for example), but since you have already returned it to them in full, they cannot now sue you for not protecting it. The whole rationale of the protection legislation is to ensure LLs do not get to keep Ts' deposits for no good reason. You have not kept their deposit. End of.

    Tell them this. If they insist on suing you, they will end up losing and paying your court costs too.
    'Pause you who read this, and think for a moment of the long chain of iron or gold, of thorns or flowers, that would never have bound you, but for the formation fo the first link on one memorable day'. Charles Dickens, Great Expectations

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    • #3
      Originally posted by mind the gap View Post
      It's greedy nonsense. It is true that you should have protected it (alhtough there is no legal requirement to pay any interest - the DPS is free to use, for example), but since you have already returned it to them in full, they cannot now sue you for not protecting it. The whole rationale of the protection legislation is to ensure LLs do not get to keep Ts' deposits for no good reason. You have not kept their deposit. End of.

      Tell them this. If they insist on suing you, they will end up losing and paying your court costs too.
      This is true, except possibly re the 8% reference. From where does this figure arise? Does the Letting Agreement oblige L to pay it, for instance?
      JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
      1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
      2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
      3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
      4. *- Contact info: click on my name (blue-highlight link).

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      • #4
        They told me they were advised it was 8%. Thanks for all the advice I am going to ignore them.

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        • #5
          "Advised" is a mite vague, isn't it? I agree with you- ignore them unless they can substantiate their supposed claim.
          JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
          1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
          2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
          3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
          4. *- Contact info: click on my name (blue-highlight link).

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          • #6
            Originally posted by Lavers69 View Post
            They told me they were advised it was 8%.
            8% is the County Court per annum rate of interest you can claim when you make a claim for a sum of money. Tenant may be confused thinking he can charge this on the 3x deposit amount (which he can't, because it's not a debt as such).

            Whilst you should of course have protected the deposit, and there is at least a chance that a non-compliance claim would succeed, the tenant comes across as an unreasonable and greedy character, and if he does go ahead with the claim this will probably be apparent to the judge, and will not work in his favour.

            I agree with MTG & Jeffrey, just ignore the threat and, if the tenant does issue a claim, I would engage a specialist lawyer to defend it (if you're in London I can recommend someone). Non-compliance claims must be issued on form N208, which means they will be allocated to the multi-track (not the small claims track) where both parties are exposed to the other's legal costs - so, if T lost, he'd probably have to pay your legal costs.

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