Property sold but deposit was not re-protected. Ground for compensation?

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    Property sold but deposit was not re-protected. Ground for compensation?

    I'm in trouble because the new landlord claims the old agent is responsible for the deposit, while the old agent says they aren't.

    A company bought a property with tenants in situ. Funds were paid on 20th Apr. On 25th Apr. a solicitor representing the new LL sends a letter stating that the company is the new LL, and included is a letter from the old LL concurring.

    On 5th May the new managing agent sends a letter again concurring, mentioning section 47. Tenant pays rent to this managing agent since.

    On July 1st, tenant leaves on good terms. Only problem is, the new LL tells tenant that the old agent is responsible for the deposit. Old agent says they aren't. The plot thickens because the land registry says the new LL became the owner on July 15th...

    I'm basically between a rock and a hard place. WHO is responsible for the deposit in this case?

    #2
    Do landlords have to issue "Deposit Certificate"?

    My deposit was protected with mydeposits, but they are not answering questions because apparently there was an administrative error and the amount on their record don't match what I have, and I must tell them the exact amount THEY have for security reasons. I told them I got a letter from the agent, signed by the agent describing the deposit amount and offered them to show it, but according to mydeposits, this letter isn't the "Certificate", and I need to get the "Certificate", which should show the exact amount given to mydeposits. This letter is printed on the agents' letter head.

    However I can't find any law that say landlords need to issue such "Certificate", though mydeposits website does seem to say that the landlord has to issue this "Certificate".

    Is the landlord required to issue such Certificate? I.e. can I demand that the agent issue this Certificate to me now?
    Last edited by TT8HS3E7D0P; 24-11-2016, 07:38 AM. Reason: clarifications

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      #3
      Is there a provision in the tenancy agreement saying that the landlord will repay the deposit (after deductions) when the tenancy ends?

      Comment


        #4
        The new landlord will be responsible, and should return it & is also liable to be sued for up to 3xdeposit for not protecting.

        Are you tenant, agent (which?), adviser?
        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...

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          #5
          Originally posted by Lawcruncher View Post
          Is there a provision in the tenancy agreement saying that the landlord will repay the deposit (after deductions) when the tenancy ends?
          Yes, the tenancy agreement specifically states it will be returned within 10 days of the tenants departing.

          Comment


            #6
            If you paid a deposit to the landlord who sold the property, the buyer "became" that landlord when the sale completed.
            The legal phrase is that the buyer "steps into the shoes" of the seller.

            So the new landlord is (as far as I can see) not correct (unless the new landlord agreed something specifically with the agent in parallel).

            You may have to suggest that the new landlord takes some legal advice (or speaks to their landlord association) as this is something that conveyancers often seem to miss.
            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 theartfullodger View Post
              The new landlord will be responsible, and should return it & is also liable to be sued for up to 3xdeposit for not protecting.

              Are you tenant, agent (which?), adviser?
              That's what I thought, but I became unsure because the land registry says at the time the tenant left the property, the property still belonged to the old landlord.

              I'm one of the joint tenants.

              Comment


                #8
                Originally posted by theartfullodger View Post
                The new landlord will be responsible, and should return it & is also liable to be sued for up to 3xdeposit for not protecting.
                I don't think OP has suggested that the deposit wasn't protected.

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                  #9
                  MyDeposits terms and conditions require a certificate is issued (from memory).
                  But the information that is required is satisfied by the landlord / agent issuing you a document called the "Prescribed Information) which contains details of your deposit and lots of terns and conditions.

                  It's several pages long, is signed by the landlord, will (almost certainly) have the words Prescribed Information at the top, and, your landlord is required to give it to you within 30 days of your receiving the deposit.

                  So you should definitely have a copy and you should be able to get a copy from your agent/landlord.
                  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


                    #10
                    The land registry can be behind the times.

                    If the buyer is saying that you left before they were the owner, they can obviously both assert that and may need to prove it.
                    If they served notice that they were your landlord (and/or you paid them rent) they can't assert that with any hope of success.
                    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


                      #11
                      Originally posted by TT8HS3E7D0P View Post
                      Yes, the tenancy agreement specifically states it will be returned within 10 days of the tenants departing.
                      In that case the new landlord has an obligation in respect of the deposit as the obligations of the landlord under the tenancy agreement pass to him as provided for by section 3 of the Landlord and Tenant (Covenants) Act 1996. However, the old landlord also remains liable unless and until he is released from his covenants.

                      Apart from the above, if the deposit is held by a third party he also has a duty to repay it.

                      Comment


                        #12
                        It is sufficient for a penalty to apply under s 214 of the Housing Act 2004 if you cannot obtain confirmation from the scheme administrator that the deposit is being held in accordance with the scheme given the information the landlord has provided you. However, that clause doesn't have a date limit associated with it so it can possibly be corrected by the landlord giving you more information so that you can obtain the confirmation.

                        In terms of MyDeposits' insurance scheme rules ("initial requirements of the Scheme"), the landlord is not required to give a copy of the "Deposit Protection Certificate" (as issued by MyDeposits) to the tenant if there is only one tenant, however they are required to at least give you the DPC number "at some point during or at the end of the Tenancy". For joint tenancy, the landlord is required to give a signed copy of the DPC and MyDeposits' "Information for Tenants" leaflet to the nominated Lead Tenant. The landlord (possibly via their agent) would be in violation of the initial requirements if the information they had provided to MyDeposits doesn't match what's in your AST agreement. In particularly, I'm thinking of the amount of the deposit.

                        The rules for MyDeposits' custodial scheme is much simpler, and almost impossible for a landlord to fall foul of.

                        There is a bunch of information the landlord is required to provide you within 30 days under the Housing Act 2004 itself, regardless of the scheme's rules, some of which would had been contained in the DPC. If that hasn't been provided to you, then the landlord would had been required to provide it to you in some other form. If all you have is effectively "We protected your deposit with MyDeposits", then the landlord/agent hasn't provided you the prescribed information required.
                        I am not a lawyer, nor am I licensed to provide any regulated advice. None of my posts should be treated as legal or financial advice.

                        I do not answer questions through private messages which should be posted publicly on the forum.

                        Comment


                          #13
                          Originally posted by KTC View Post
                          It is sufficient for a penalty to apply under s 214 of the Housing Act 2004 if you cannot obtain confirmation from the scheme administrator that the deposit is being held in accordance with the scheme given the information the landlord has provided you. However, that clause doesn't have a date limit associated with it so it can possibly be corrected by the landlord giving you more information so that you can obtain the confirmation.
                          I think that this has to exclude cases of scheme's ineptitude.

                          Comment


                            #14
                            The buyer's Conveyancing Solicitor should have sorted the Deposit allocation before Completion.
                            Tech, new LL is liable for deposit IMO.

                            Comment


                              #15
                              Property sold but deposit was not re-protected. Ground for compensation?

                              At the start of the tenancy, deposit was protected with mydeposits (insurance-scheme) by a managing agent. Property was sold, agent changed but the deposit was never re-protected by the new LL/agent. The current managing agent claims it's still protected properly "with the previous agent". However mydeposists' scheme rule says insurance based deposit protection aren't transferable.

                              Is this basically a slam dunk case for s214 penalty?

                              Also, it's slightly unclear to me who the T can pursue. The tenancy agreement states that in the event of a sale T "agrees to transfer the deposit to the purchaser", and "then, the landlord should be released from any liability". That sounds like the only person T can pursue is the new landlord (the purchaser). But the current managing agents' argument is, they have not received deposit from the previous managing agent yet, and thus T should go after the previous managing agent.

                              Comment

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