‘UNFAIR’: Landlord faces £5,000 fine for deposit protected six months late by her lettings agency

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A landlord with a property in West Essex has urged LandlordZONE readers to be more careful when trusting agents to protect their tenants’ deposits via one of the government’s approved schemes after a vindictive renter took her to a property tribunal.

The female landlord, who wishes to remain anonymous until the legal process is exhausted, faces paying up to £5,000 to her former tenant after her letting agency protected his deposit with an approved scheme six months after the statutory 30-day deadline.

The tenant had caused water damage to the property during his 18-month stay between 2000 and 2021 and she sought to deduct money from his deposit via the deposit scheme’s redress process.

This deduction went ahead following the mediation process, but the tenant was then tipped off about late protection of the tenancy deposit and has now taken her to a First Tier Property Tribunal to claim up to three times his monthly rent in compensation via a ‘no-win, no-fee’ firm of solicitors

Tribunal

The landlord tells LandlordZONE that she spoke to the agency who had managed the property and asked that they help foot the bill for any potential award given by the tribunal.

But the agent inaccurately said it’s the landlord who is responsible, not the agent, and refused to get involved.

The landlord also says her deposit scheme has refused to give her any information that might help, which she needs as her letting agent went bust soon after the tenant left the property, so she needs confirmation that it was her agent who submitted the deposit late.

The lettings agency has subsequently started trading once again under new ownership and says the dispute is between the landlord and the firm’s previous owners.

“Since I got the letter from the solicitors I’ve been on anti-depressants because I can’t cope,” she says. “I feel everyone involved be it the deposit protection scheme or the letting agents have all left me high and dry to face this vindictive tenant alone. Where am I going to find £5,000?

“I keep wondering why the tenant would do this – but I suppose, like PPI claims, it’s because they can.”

Warning

The landlord says she wants other landlords to understand their responsibilities under the Housing Act 2004 and that they should not assume they are protected when a letting agency lodges a tenant’s deposit on their behalf via one of the three schemes – DPS, TDS and mydeposits.

“I did a ‘secret shopper’ ring-around of several agents in the area to ask them who is responsible for deposits, and many of them said it wasn’t the landlord – so even they don’t even know the law,” she adds.

“It has made me super aware of all of the regulations and rules governing the industry because it turns out I’m the one who foots the bill if it’s done incorrectly.”

Expert opinion

Sean Hooker, Head of Redress at the PRS, which was not involved in this case, says: “This is a tragic but rare set of circumstances.

“Both the landlord and the agent are jointly responsible for protecting the deposit once the tenant pays it over to the agent.

“If the deposit is not protected and the correct information provided to the tenant in time, then both parties are jointly responsible, but it is usually the landlord who is taken to court.

“A landlord cannot say it is ‘nothing to do with them’. They will have to deal with the situation and take their own action against the agent, either through a redress scheme or the courts. In this case, as the agent no longer exists, the landlord faces the rap on their own.”

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