Ex-tenant Tries to Sue for Non-Protection of Deposit - a Valid Claim?

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    Ex-tenant Tries to Sue for Non-Protection of Deposit - a Valid Claim?

    Hello, I have a problem with an ex-tenant who rented a room in a shared house from me between June 2012 and February 2013. I was wondering if the forum members could help me as I was not able to find specific cases where the landlord has been successfully sued for non-protection of the deposit.

    The Situation:
    - One of my tenants is suing me for non-protection of a deposit
    - I have received a claim for 3x the deposit amount filed through www.moneyclaim.gov.uk
    - I can show that I have been very reasonable. Not only has the tenant been difficult (I have plenty of emails to prove this) but when the tenant decided to move out I agreed to a move out date 5 days from her notice and did not insist on the 1 month notice period. The tenant only paid rent up the the very day she was in the flat.
    - The deposit has been refunded in full and the tenant confirmed receipt in writing. The tenant has suffered no monetary loss.
    - I see the tenant's attempt to sue as an attempt to extort money. She is clearly frustrated by some aspects in her life (recent break up with partner) and is looking for someone to blame. I even have a printout of an advert she posted on a website using my full name, calling me various names and stating that I don't return tenants deposits and have cheated her out for hundreds of pounds. None of this is true and I even have in writing that she received her deposit back! I am just mentioning this to indicate the character to the tenant I have to deal with.


    My Questions
    - Is there any case law where the tenant has successfully sued the landlord for non-protection after the deposit has been returned and after the tenancy has ended? I know the law says the tenant 'can' sue up to 6 years but I would like to find an actual case rather than using theory and speculation.
    - Is the claim valid given the tenant has not suffered any loss, the deposit has been returned and I have been very reasonable throughout?
    - Can the claim be thrown out on the basis that it should be submitted as a 'Part 8 claim' with full County Court hearing? This thread mentions this: http://www.landlordzone.co.uk/forums...-compensation&

    Thanks in advance for your help!

    #2
    They can not use moneyclaimonline.
    Allow tenants to protect their own deposits. I want free money when they do it wrong

    Comment


      #3
      Were you resident in the house as well?
      I offer no guarantee that anything I say is correct. wysiwyg

      Comment


        #4
        @thesaint - thanks! What would be the correct procedure to get the claim dismissed? I assume the next step for me would be to return the defence form?

        @jta - no, I never lived in the house.

        Comment


          #5
          Yes you can ask for the claim to be thrown out because it has not been filed as a part 8 and you my be successful.

          This may, of course, result in the claim being resubmitted in the correct manner.

          However it seems clear that you have not complied with your statutory obligations and therefor a judge would have no choice but to grant at least the deposit value as a penalty. The fact you have returned the deposit does not affect this.

          So, your choice . . .

          Accept current claim, be penalised between 1 & 3 times value of deposit together with tenants court fees & expenses (prob no more than £100 expenses). We can not predict a judges decision, but I would expect your penalty to be at the lower end of the scale.

          or

          Dispute claim in the hope you have to pay nothing. In this case there is a risk that the tenant will resubmit and presuming the claim goes against you you not only run the risk of the penalty but court fees and legal costs - the court fees alone will be over £1k for a part 8 and claimants solicitor (£150/hr?) which are not claimable in 'small claims'.

          Comment


            #6
            I'm no expert here but perhaps you have a libel claim?

            Do you have proof that T published lies to defame your character and damage your business reputation? I thought that was not allowed and you may be entitled to compensation? I think this is becoming more of a problem these days with the internet.

            Maybe T will drop their 3X claim or have to pay it back to you plus more. They may not get legal aid for a libel case and have to pay your costs if they lose.

            Landlords need to steer clear of deposits if they can't be sure of compliance. Or make sure they comply properly.

            Comment


              #7
              @Snorkerz - thanks for the excellent advice! I will consider asking for the claim to be thrown out as I doubt the tenant will risk/have such an amount of money to re-submit, but you never know! The deposit value is less than £500, so it would be a big risk to take.

              @bureaucrazy - yes, there could be a libel case, the website owners said they will confirm who posted the advert to a solicitor.

              Comment


                #8
                Originally posted by TLondon View Post
                @Snorkerz - thanks for the excellent advice! I will consider asking for the claim to be thrown out as I doubt the tenant will risk/have such an amount of money to re-submit, but you never know! The deposit value is less than £500, so it would be a big risk to take.
                Beware of no-win-no-fee claim firms.

                Comment


                  #9
                  Have there been any actual cases where a tenant has claimed simply on the basis of non-protection via Part 8? All cases I have come across so far relate to claims for the deposit to be returned plus compensation, but not compensation only AFTER the deposit has been returned.

                  Comment


                    #10
                    Just defend the claim, small claims is dead easy. You wont be in a courtroom just the recorder (a judge wannabe aka solicitor) office. As the ex-tenant cannot show a loss (they have their deposit back after all) you'll be fine. On the form file a counter claim for expenses (be reasonable). Whatver happens MAKE USRE YOU TURN UP. if you dont they win by default without a hearing.

                    Comment


                      #11
                      Originally posted by chloe_1775 View Post
                      As the ex-tenant cannot show a loss (they have their deposit back after all) you'll be fine.
                      Unfortunately this is not how non-compliance claims work, and losses are irrelevant:
                      For the penalty to be imposed on the landlord the only thing that matters is whether the deposit was correctly protected as per statute.

                      Comment


                        #12
                        Originally posted by Snorkerz View Post
                        However it seems clear that you have not complied with your statutory obligations and therefore a judge would have no choice but to grant at least the deposit value as a penalty.
                        Originally posted by chloe_1775 View Post
                        Just defend the claim, small claims is dead easy. You wont be in a courtroom just the recorder (a judge wannabe aka solicitor) office. As the ex-tenant cannot show a loss (they have their deposit back after all) you'll be fine. On the form file a counter claim for expenses (be reasonable). Whatver happens MAKE USRE YOU TURN UP. if you dont they win by default without a hearing.
                        This is not a matter of loss, note the word 'penalty', that's what this is. The penalty is prescribed in statute.

                        Section 214(4) as amended reads:

                        The court must order the landlord to pay to the applicant a sum of money not less than the amount of the deposit and not more than three times the amount of the deposit within the period of 14 days beginning with the date of the making of the order.

                        If applicable, section 214(3)(a) applies to ensure the deposit is also returned where the landlord has retained it. Prior to April 2012 case law had established that returning the deposit was adequate to avoid the penalty - the 2011 Localism Act closed that loophole. If the deposit is not protected within 30 days of receipt then the landlord has no way of defending such a claim.

                        Comment


                          #13
                          And help for tenants who claim here...
                          http://www.landlordlawblog.co.uk/201...p-for-tenants/

                          Cheers!!
                          I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

                          Comment


                            #14
                            Originally posted by Snorkerz View Post
                            If applicable, section 214(3)(a) applies to ensure the deposit is also returned where the landlord has retained it. Prior to April 2012 case law had established that returning the deposit was adequate to avoid the penalty - the 2011 Localism Act closed that loophole. If the deposit is not protected within 30 days of receipt then the landlord has no way of defending such a claim.
                            How would this apply to deposits which were taken (and protected late) before the Localism Act came into force, but returned after the Localism Act came into force? So the tenancy would have been in effect as at April 2012.

                            (sorry for the slightly convoluted question, apologies if it's not clear)

                            Comment


                              #15
                              Originally posted by onbothteams View Post
                              How would this apply to deposits which were taken (and protected late) before the Localism Act came into force, but returned after the Localism Act came into force? So the tenancy would have been in effect as at April 2012.

                              (sorry for the slightly convoluted question, apologies if it's not clear)
                              So long as the deposit was protected by 5th May 2012 the landlord is in the clear.

                              Comment

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