deposit deadlock

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    deposit deadlock

    I had a tenancy starting Jan 2007. It was a company let but the AST agreement was with direct with the couple (although rent and deposit paid by the Company). The company insisted on 3 things. They provide the tenancy agreement, that the Deposit was held in Escrow by stakeholders (in this case a firm of solicitors) and when the original AST ended that we sign a further deed of Amendment of Tenancy. Despite requests by ourselves to use our own AST (which we use with other tenants which contained DPS T&c, PI etc)in June 2007. I am pretty sure the couple seperated last year ( but she continued to live in the property and company continued to pay the rent). She gave notice in February 2012 and asked for a new Deed of Amendment to be signed with the tenancy ending July 2012. Realising that I had incorrectly assumed that as the tenancy was pre April 2007 it didn't need depositing in an approved scheme. I sent a new agreement in March this year which includes a copy of the DPS terms and conditions and PI. She wouldn’t return it or the PI information. When we spoke to the stakeholders (a firm of solicitors) they would not release the deposit monies to the DPS stating they needed signatures from both Tenants and third party (in this case the company, who supplied the deposit). We got left with thousands of pounds worth of damage when the tenants left (which even the tenants inventory clerk conceded was damages covered under the term of the agreement) and they didn't pay in full the last month’s rent- . The tenants have conceded a portion of our claim. But they won't write to the stakeholders enabling this part of the deposit money to be released. They are now starting to threaten us with the deposit not being lodged with DPS, which is ironic as they wouldn't provide any authorisation for it be released from escrow for it to be put there. Where do we stand? Starting to have sleepless nights over it all!

    #2
    I wonder if the solicitors who held the deposit would have been a reasonable alternative & within the deposit laws? Anyone else know?

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      #3
      The only information on the internet I can find suggests that deposits are only legally protected in if they are in one of the 3 approved schemes. I can't find any cases relating to a tenant not providing the information that allows the monies to be transferred to a legal scheme. Its seems a unique situation!!!

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        #4
        But arguably you haven't actually received the deposit, have you? It has never, apparently, been paid over to you, but paid to and held by the stakeholder solicitors. It's whoever is in receipt of the deposit that is responsible.

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          #5
          Originally posted by lisade View Post
          ...when the original AST ended that we sign a further deed of Amendment of Tenancy. Despite requests by ourselves to use our own AST (which we use with other tenants which contained DPS T&c, PI etc)in June 2007.
          You seem to be saying that a six month fixed term was granted in Jan 2007, and when it expired you agreed a deed of amendment? What was the nature of this 'amendment'? Why didn't you just grant a renewal fixed term?

          She gave notice in February 2012 and asked for a new Deed of Amendment to be signed with the tenancy ending July 2012.
          Ditto, I'm confused as to how things proceeded. Why would you need an amendment to end a tenancy?

          Where do we stand? Starting to have sleepless nights over it all!
          If you have been left seriously out of pocket, and have evidence to support a claim (it seems you do), then I would claim in the county court against the tenant for your losses, quite simply. You don't have any access to this deposit, and the stakeholder won't release it; if you win a court claim the stakeholder will presumably be obliged to pay out.

          If the claim is for £5,000 or less it will be allocated to the small claims track, where court fees are low and you don't need a solicitor. But you'll find it helpful to buy or borrow a book on small claims procedure, many on Amazon.

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            #6
            Maybe have a look here: http://www.legislation.gov.uk/ukpga/...rt/6/chapter/4and here: http://www.legislation.gov.uk/ukpga/2004/34/schedule/10 and see if that solicitor fits the bill.

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              #7
              What do you mean by 'fits the bill'?

              (BTW here is a link to Snorkerz' HA2004 incorporating Localism Act amendments - http://www.snorkerz.com/deposits_new.htm )

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                #8
                True, never reveived the deposit. we raised an invoice and the company paid the deposit into the stakeholders escrow account. Looking at the links I've been sent below. It looks like The court can request return from person holding the deposit ie the solicitor , but the landlors still looks likely to be at risk from a fine (4) The court must [ix] order the landlord to pay to the applicant a sum of money not less than the amount of the deposit and not more than [x] three times the amount of the deposit within the period of 30 days beginning with the date of the making of the order.

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                  #9
                  s.212 (9) In this Chapter—
                  (a) references to a landlord or landlords in relation to any shorthold tenancy or tenancies include references to a person or persons acting on his or their behalf in relation to the tenancy or tenancies,

                  Comment


                    #10
                    Originally posted by westminster View Post
                    You seem to be saying that a six month fixed term was granted in Jan 2007, and when it expired you agreed a deed of amendment? What was the nature of this 'amendment'? Why didn't you just grant a renewal fixed term?

                    Many thanks for your feeback
                    ?? at the end of the 1st 6 months we proposed another 6 months fixed renwal with our own AST agreement. The company insisted that we had to sign an amendment to lease instead which was basically a one pager signed by tenants and ourselves with new 6 month fixed period the terms of the orginal lease staying in play.


                    Ditto, I'm confused as to how things proceeded. Why would you need an amendment to end a tenancy?

                    In Jan 2012 the tenant wanted a fixed term until 9th July 5 1/2 months. she advised us she wanted to ensure that she could stay in the property while her daughter finished her exams and then would be returning to Germany to live.

                    If you have been left seriously out of pocket, and have evidence to support a claim (it seems you do), then I would claim in the county court against the tenant for your losses, quite simply. You don't have any access to this deposit, and the stakeholder won't release it; if you win a court claim the stakeholder will presumably be obliged to pay out.

                    We are aware that Small claims is a potential route. What I have been un able to ascertain is if have we failed to correctly protect the deposit as per Housing Act requirements. Would a court find us liable and fine us if the tenant failed to provide the information to the stakeholders which would allow it to me moved to a custodial scheme. So its a risk calculation go to court to get 4.5k back and risk tenant going to court and we being fined 1-3 times the deposit which is 3k-9k.
                    ............

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