Tenant vs Permitted Occupier deposit dispute

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    Tenant vs Permitted Occupier deposit dispute

    Hi,

    Last year I wanted to rent a 2 bedroom flat in London with another person but eventually they could not be added to the AST as Tenant. To avoid delays we agreed to have them added as a Permitted Occupier and sent me half the deposit and half the rent monthly.

    Halfway through the year-long contract they decided to leave, to which I agreed as long as they told me when they were moving out and found someone to replace them, to which they agreed. There was no written agreement whatsoever other than a bunch of messages. They eventually left without finding a replacement although they said they would.

    Could not force them to stay or pay rent (and the agency did not care as they were just a permitted occupier) so I had to pay by myself for a few weeks until I found someone to move in. The previous occupier is now also asking for the deposit back although it's not with me but with the agency and they will only return it to me in a few months' time.

    Do they have any legal claim to the deposit now or at the end of the contract when the agency gives it back to me? When they left they knew they were dumping many times the amount of that deposit on my head as rent so can I not use it to limit my losses?

    To put it another way, they took advantage of not being on the contract and simply left although they signed and we agreed on a 1 year AST, so can I not take advantage of being on the contract and the sole receiver of the deposit and protect myself from the damage they caused? As far as I know a landlord can use deposit money to cover unpaid rent so can I not do the same?

    Can they sue me for not returning it or claim the amount was sent by mistake and want it back (although the monthly payments that followed prove that is not the case)?

    Quite a long message and loads of questions here, but hope it makes sense. Please let me know if anything is unclear!
    Thanks for reading!

    #2
    A deposit remains the property of the person who "gave" it to you, until the situations it is a deposit against occur, or they can no longer occur and then it's returned by the person it was "given" to.
    In this case, the person was paying you rent and they were your tenant or lodger (it doesn't matter what their status was on your tenancy agreement with your landlord).

    They may or may not have had an AST all of their own, depending on the arrangements.
    Either way, you were their landlord and should return their deposit to them now there is no possibility of deductions being made.

    Their deposit and your deposit are completely separate things.
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      Thanks for your answer.

      It sounds as if I had one agreement with the agent and another with the occupier. Is that how this is legally perceived? That would also mean he was a permitted occupier on one AST and at the same time a lodger on another agreement, can that happen?

      If that's the case then what are the terms of my agreement with the occupier since there is nothing in writing? Are there any default terms used when there is nothing written?

      For example he gave me only 3 weeks' notice before moving out, I can claim It should have been a full month and keep one month's rent.
      Also the agency might charge for damage he did and I can't know that yet. If I was their landlord then I am entitled to make charges, should I just try and estimate the charges the agency might make?

      It's all very much left to guessing, that's why I was asking about the obligations from a legal perspective - you mention "should" return their deposit, is that meant as a "you're legally obligated to"?

      Comment


        #4
        I certainly enjoy the search for clarity on what we must do as part of our legal obligations as much as the next man.

        However, I always prefer to contemplate what I should be doing from a moral standpoint. And, yes, what others should be doing from a moral standpoint.

        And I now always ask myself... "is anyone going to give a hoot about this 5 years from now?" ...finding that the answer is nearly always "no".

        Comment


          #5
          Originally posted by HiThere View Post
          It sounds as if I had one agreement with the agent and another with the occupier. Is that how this is legally perceived? That would also mean he was a permitted occupier on one AST and at the same time a lodger on another agreement, can that happen?
          Yes and I think its what did happen.

          If that's the case then what are the terms of my agreement with the occupier since there is nothing in writing? Are there any default terms used when there is nothing written?
          There are, it's simply a verbal contract.
          As I think it's more practical to think of them as a lodger (because the alternative is much less simple) the implied terms are fairly simple, and, are now mostly irrelevant, as the arrangement has ended.

          For example he gave me only 3 weeks' notice before moving out, I can claim It should have been a full month and keep one month's rent.
          Unless you agreed that, it isn't an implied term of a lodger agreement (as far as I know), notice has to be reasonable.

          Also the agency might charge for damage he did and I can't know that yet. If I was their landlord then I am entitled to make charges, should I just try and estimate the charges the agency might make?
          The landlord may try and charge you for damage as you're liable for the property.
          Unless your lodger did some obvious damage, your claim is probably a bit of a non-starter as you would have to be able to prove it was them, and without a check in and out report (like the one the agents will have done) you can't really do much.

          It's all very much left to guessing, that's why I was asking about the obligations from a legal perspective - you mention "should" return their deposit, is that meant as a "you're legally obligated to"?
          You're holding someone else's money and have no entitlement to it, so you should (i.e. must) return it.
          If he sued you in a court they'd make you return it.

          And now you know it's not your money, I'd say keeping it was theft (by conversion).
          When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
          Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

          Comment


            #6
            Hi Hippo,

            Yes that is a good point, hopefully I won't care about this 5 years from now.

            Just for the record, I'm not trying to 'steal' their deposit or anything, and I'm not trying to make a profit out of this (it would be impossible even if I kept the whole deposit amount as there are also bills they haven't paid, etc.).

            The fact that they did not honour their promise and the AST they signed has affected me and I am merely trying to recover that loss. I would have been perfectly ok with them leaving if it did not have any adverse affect on my financials.

            The issue they had prevented them from being a 'Tenant' as part of any UK contract and they knew no one else in London at the time. I feel they took advantage of me trusting them and agreeing on not having them as Tenant and got out of the agreement they signed, lying about finding a replacement and knowing they would cause me significant financial damage.

            As a consequence I do feel I have the moral high ground here. What concerns me is whether the law is on my side as well. Any other opinions in that regard?

            Comment

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