Estate agent in liquidation - deposit is not re-protected

[Platomey]

Hi,

I think I am in a very tricky situation and therefore need some advice.

My letting contract started on 6th May 2009 and the deposit of £1300 was initially protected by MyDeposits scheme by the Estate Agent on behalf of my landlord. However, in October 2009 I received a letter from MyDeposits saying that the agent is no longer a member of the scheme and after 90 days (January 2010) my deposit will cease to be protected. In the letter, however, it was mentioned that my landlord is still responsible for re-protection of my deposit.

I contacted my landlady in February and she told me that the agent is in liquidation and that it didn’t give her my deposit back. But she said that she will sort it out. In the meantime we agreed to talk about the letting contract a bit later (the notice period is 2 months and I should have given the notice on the 5th March if I wanted to move out on the 5th May which is the end of the contract)

However, today she called me saying that she will need some time to recover my deposit from the agent and gave me two choices:

1) To extend the contract and wait until she recovers the deposit

2) To move out but lose half of my deposit because I didn’t give her 2 month notice before expiration of the contract:eek:

Is there a law that says that I am losing half of my deposit if I don’t give 2 months notice before the end day?

Also, what would you recommend me to do? Shall I go to court to recover my deposit? And is my lawsuit likely to be satisfied given that the agent is in liquidation?

 

I am just thinking that if I sing a new contract with her – I may never get my deposit back!

[Steve__M]

Do you actually want to move out on 5th May?

 

Can you tell us exactly what the contract says about giving notice?

 

She is still responsible for your deposit whether or not she can recover it from the agent.

 

You have the right to threaten her with a court action now for failing to protect your deposit. She would be at risk of a 3x fine. Certainly I would write to her and inform her of this well before you move out.

[MrShed]

Can you tell us exactly what the contract says about giving notice?

 

I doubt it matters Steve.

 

The Housing Act states that a stat periodic tenant needs only give 1 months notice regardless of what the contract specifies.

 

What was the fixed term of the contract?

 

With regards the deposit, it is quite simple. The landlord is responsible for it. They need to reimburse it to you (or more appropriately, re-protect a sum equivalent) and reclaim it from the agent.

 

Her reclaimation of the deposit from the agent is none of your concern.

[Platomey]

Thanks for your reply Steve!

I have actually sent her a letter saying that I will have to go to court if she doesn't re-protect my deposit and gave her 7 days. I did it last Monday (i.e. 7 days ago). Before that I texted her twice around 2-3 weeks ago.

I would like to stay but my worry is that if I sign another contract with her it will complicate the things for the court. However, on the other hand it would give me some protection against being evicted by her. Basically, I am worried that she can try to evict me if I don't sign a new contract with her and file a suitcase instead; and I also don’t want to move out before my deposit is sorted.

My contract simply says that I have to give a 2 month notice if I want to move out but it doesn't specify any penalties if I don't do it before the end of the contract.. I thought that there may be a law that requires me to give a notice or state my intentions two months before the expiration of the contract.

[Steve__M]

I doubt it matters Steve.

 

The Housing Act states that a stat periodic tenant needs only give 1 months notice regardless of what the contract specifies.

 

OP says he is still within the fixed term and that it ends on 5th May.

 

It would be helpful if the 2-month clause were purely a break clause, as the tenant could ignore it and move out at the end of the fixed term. Some contracts say notice is required even up to the end of the fixed term, and I've heard reasonably good arguments that such clauses are enforceable.

[Steve__M]

Platomey,

 

You do *not* have to sign another contract to stay another month.

 

Once your contract is up, you need to give one month's notice as you would be in a periodic tenancy.

 

Do you actually want to move out. If so, when do you want to or need to move out

 

If you sign another contract it doesn't change issues for any court case.

 

LL cannot get rid of you if the deposit is unprotected (and if you keep paying your rent) as a Section 21 notice is invalid while the deposit remains unprotected.

[MrShed]

OP says he is still within the fixed term and that it ends on 5th May.

 

 

My bad!

[Platomey]

The Housing Act states that a stat periodic tenant needs only give 1 months notice regardless of what the contract specifies.

 

But there is 2 month notice period in my contract - why would they put it if they definitely know it should be 1 month?

 

What was the fixed term of the contract?

 

It was 1 year + 2 month notice

 

With regards the deposit, it is quite simple. The landlord is responsible for it. They need to reimburse it to you (or more appropriately, re-protect a sum equivalent) and reclaim it from the agent.

 

That sounds logical to me - but does The Housing Act specify what to do with regards to re-protection of the deposit? It was protected 14 days after the start of my tenancy but simply wasn't re-portected afterwards...

[MrShed]

But there is 2 month notice period in my contract - why would they put it if they definitely know it should be 1 month?

 

Common practice - nothing more. Its totally unenforceable.

 

 

 

 

That sounds logical to me - but does The Housing Act specify what to do with regards to re-protection of the deposit? It was protected 14 days after the start of my tenancy but simply wasn't re-portected afterwards...

HA 2004 Section 215 specifies:

 

that he has been notified by the landlord that a particular authorised scheme applies to the deposit but has been unable to obtain confirmation from the scheme administrator that the deposit is being held in accordance with the scheme.

As it is not protected, you cannot obtain confirmation that the deposit is being held. This covers this eventuality.

[Steve__M]

Some contracts include a break clause, so that it can be ended before the end of the fixed term. A two month break clause is perfectly legitimate if it only applies to the fixed term.

[Platomey]

Once your contract is up, you need to give one month's notice as you would be in a periodic tenancy

 

I think I have to check what my contract says - whether I need to give 2 months before my contract expires or on the day it expires. However, as I understand now that even if it is before I still have some time because it should be 1 month according to The Housing Act.

 

On the other hand, if I don't want to move out and decide to stay, would you:

 

1) Recommend me still file a suitcase against my LL after signing a new contract

2) Or wait until she gets me deposit back from the Agent? (which can take ages if at all happens...)

[Platomey]

Some contracts include a break clause, so that it can be ended before the end of the fixed term. A two month break clause is perfectly legitimate if it only applies to the fixed term.

 

My contract is for 1 year with six months break clause. Which meant that I could have given my 2 month notice after 6 moths. Since I didn't do it I have to give it after 12 months, which is 5th May 2010. Or at least I hope so (I will have to check what my contract says).

[Platomey]

I checked my Tenancy Agreement and did not find any mention about the notice period whatsoever. It only states the term of the tenancy of 12 months ending on the 5th May 2010. However, in the offer pack it says that "..... It is advisable to contact us (The agent) 2-3 months before the expiration of the property to discuss your intentions. A delay in notifying us may force the LL to serve notice and start remarketing the property"

 

Given that, I assume I can just move out on the 5th May without any further notice and not risking anything? What do you think?

 

Also, if I file a lawsuit against my LL now (and move out on the 5th May) and the court hearing is held after I move out, will I still be able to get my deposit back along with any additional fine and, expenses? I heard that this may not work because by the time the case is heard I may not be occupying the property any more...

[MrShed]

You can leave at the end of the fixed term without notice or penalty.

 

The fact that you are not resident any longer at the time of court hearing SHOULDNT be an issue at court.

[Platomey]

Thanks very much for your help and advice MrShed and Steve! I will be sending everything off to the court tomorrow.

 

Just to confirm, would you recommend to cap the claim at £5000. Otherwise it works out more than that (1290*4+court fee of 150=£5310)

[MrShed]

Why would you cap at £5k?

 

This wouldnt go to small claims track anyway...I dont think?

[Platomey]

I think I have read on this forum that if I cap my claim at £5000 it will go to small claims track and then I shouldn't worry about any costs incurred by my LL if I lose the case (which is not likely anyway I hope)

[MrShed]

I could be wrong (the court bit is where I sadly begin to lose any knowledge), but I was under the impression that the form required to submit a claim under this act prevented small claims track?

[Platomey]

Yes, you are probably right - I will file for the whole amount. I am just confused how much I should pay for this claim? I have seen £108.00 somewhere on this forum but http://www.hmcourts-service.gov.uk/courtfinder/forms/ex50_web_0210.pdf suggests that I need to pay £225 for the amount between £5000-15000:confused:

[Platomey]

OK, my bad - £150 for Part 8 and £225 would be for N1 (where the court fee depends on the amount claimed). But my understanding is that I need to file Part 8, is it correct?

[Steve__M]

The recommendation from most people is to use Part 8.

 

If you have not already done so, just before you submit your claim, might be an idea to check all three schemes to see if the deposit is protected. Assuming it is not protected, include the fact that you have checked in your claim. As Mr Shed says, being unable to confirm the deposit is protected after being told it was, is grounds in itself for a claim.

 

If the LL manages to successfully protect the deposit after the claim is issued, then you may not be successful. However, you can still try and claim your costs for issuing the claim.

[Platomey]

If you have not already done so, just before you submit your claim, might be an idea to check all three schemes to see if the deposit is protected. Assuming it is not protected, include the fact that you have checked in your claim.

 

Done, thank you Steve and Mr Shed for your help. Issuing the claim today. LL is too self-confident and is 100% sure that I will not go to court and therefore was threatening me that I will not get half of my deposit because I didn't let her know about my intentions 2 months before the end of the agreement (stupidly assuming that I cannot read my contract!!!)

[MrShed]

Best of luck, keep us posted

[Platomey]

Thanks:)

Edited April 15, 2010 by Platomey

[Platomey]

Best of luck, keep us posted

 

Shortly after the LL received the notification from the court she secured the deposit and sent me the Deposit Protection Certificate. Good news?

 

What do you think I should do now? As far as I understand after the recent Draycott v Hannells Lettings Ltd case in the High Court there is no point in continuing my claim for 3*Deposit so I have to simply inform the court that I am withdrawing my claim?

 

What would be you advice? Also, regarding the court fee of £150 - no way of getting this back now?

 

Thanks in advance,

Anton