Deposit dispute

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    Deposit dispute

    Hi all - any thoughts on this story?

    It involves a house (in Cardiff) that was shared by four tenants on a joint-and-several assured shorthold tenancy. One of them was the lead-tenant for deposit-protection purposes. The deposit (six weeks rent) was paid in to the deposit protection scheme. At the end of the tenancy the other three tenants failed to pay their share of the last month's rent. They warned the agent that this was going to happen, and asked that it be taken from their share of the deposit.

    After the dust had settled and everyone had moved out, no deposit whatsoever was forthcoming for the three tenants in default. They expected to receive six weeks rent, minus one month (minus some interest and a small admin fee). On further investigation it turns out that the lead tenant and the agent had authorised the DPS to return the lead tenant's one-quarter share of the deposit in full, and for all the rest to go to the agents, who have kept it in full. The agents claim that they are justified in keeping the full deposit for the three defaulting tenants because of disrepair. However, they have produced no inventory to this effect, or other credible evidence, and it seems that no inventory was taken at the time moving out.

    There seems to have been some collusion between the lead tenant and the agent. The lead tenant (it would seem) was guaranteed his share of the deposit in full, if he used his status as lead tenant to enable the agents to take the rest of the deposit without having to go through the usual dispute process provided by the DPS.

    It seems to me that in a small claims action (in the last resort) the out-of-pocket tenants need to name the agents and the lead tenant as joint defendants, because there seems to have been some breach of trust on the part of the lead tenant. In fact, as far as the agents are concerned the lead tenant might be said to be acting on behalf of all four tenants, and the agents may actually have a defence to any claim against them, because the used the DPS procedure as it was intended to be used, and any argument is now between the four tenants.

    Any thoughts?

    #2
    It all sounds unsavoury and you should never use this agent again.

    However the reality is that there is only one tenant (singular), and if the tenant agrees that there was damage and the deposit should be used then there is no case for the arbitrator. They are not concerned about disagreement within the tenant.

    The only legal action could be by the three tenants against the "tenant", so let them get on with that if they wish.

    I presume the agent gave the money to you and did not pocket it themselves?

    Comment


      #3
      Originally posted by AndrewDod View Post
      However the reality is that there is only one tenant (singular), and if the tenant agrees that there was damage and the deposit should be used then there is no case for the arbitrator. They are not concerned about disagreement within the tenant.
      Disagreement "within the tenant" means that the tenant does not agree, IMO.

      Comment


        #4
        If it came to a court process, the landlord could decide to pursue an obligation against any one party. It would then become the responsibility of the other potential defendants to sort out their respective proportions of liability and payment. If L were to sue just one, and that one were to admit liability, it would not be open to the others to get involved in the case.

        There is no obligation on the landlord to seek consensus amongst components of the tenant. How would this work if this were the case - by majority vote, by unanimity.....

        If you don't want someone else to speak as if they are you (or write a cheque as if they were you), then you don't enter into a joint and several contract (or bank account).

        Clearly within the fixed term there are special things that apply to the giving of notice, but after that any tenant can speak for the tenant, on matters of notice, and I would suggest on matters of admitting damage.

        Comment


          #5
          There is an agreement on what to do with the deposit only if all the joint-tenants agree.

          If a single joint tenant disagrees he can raise a dispute with the deposit scheme (at least one scheme works that way, I haven't checked all T&Cs).

          Comment


            #6
            The issue starts before the deposit return.

            Some of the tenants can't decide to withhold rent, all of the tenants owe the rent and that isn't a decision that one person can take on behalf of all of them.

            "Warning" the landlord or agent isn't the same thing as "the landlord agreed to take the last month's rent from the deposit".
            So the tenant's expectations are interesting but appear to have no foundation.

            The lead tenant had a sum returned to them which they are expected to distribute to their co-tenants (there is one deposit, not four) and should be where any claim is made.
            How the agent and lead tenant agreed the sum is probably going to be hard to prove, but that's a red herring.

            If some of the tenants disagree with the actions of the lead tenant they can appeal to the protection scheme (although they're probably protected by their terms and conditions) or take action against the lead tenant.
            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


              #7
              Originally posted by jpkeates View Post
              If some of the tenants disagree with the actions of the lead tenant they can appeal to the protection scheme (although they're probably protected by their terms and conditions).
              You must have missed my post.

              Comment


                #8
                Many thanks!

                I should have made it clear that I'm posting on behalf of one of the tenants who feels out-of-pocket, although the advice is equally useful.

                It would seem that the safest course in the event of a small-claims action would be to name both the agents and the lead tenant as defendants. The agents have pocketed a chunk of the deposit for dilapidations which do not seem to have happened. But they may well have justification for doing so in that the lead tenant acting on behalf of all of them accepted this as correct. In which case it is the lead tenant who ought to make good.

                Comment


                  #9
                  The agent would have been acting for a landlord, so the claim for a false compensation amount should be made against the landlord who will have ended up with the deposit deductions.
                  However, use the appeals process for the deposit protection company first, as the courts are a last resort and would query why the claim wasn't made using the proper process first.

                  If the claim is that the lead tenant has received some deposit and not shared it out, that's a personal claim against the lead tenant.
                  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

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