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moonriver

Have To Wait Weeks For Return Of Deposit Because..

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I am so mad about this, and how unfair for all tenants this happens to, because it appears there is nothing we can do about it.

Am I right?

What happened was that I paid the deposit the end of March to the letting agent for a 6 month tenancy, starting 1st April.

At the end of August I gave both the agent and landlord written notice that I would not be renewing the 6 month tenancy, so would be leaving when my tenancy expired at the end of September.

Three weeks after I gave notice I would not be renewing, so only days before the end of my tenancy, I got a letter off DPS, giving details of my deposit and saying...

"Date deposit received : 1st April 2011." so I assumed that was when it had been paid into the DPS by the agent.

The landlord did a final inspection, and was very happy with the state of the property so readily signed to agree to immediate return of all of the deposit.

However, when I went on the DPS site to arrange refund of the deposit, it says...

"A Repayment Request can only be submitted once a deposit has been protected for a period of 28 days, please try again after this period."

So I phoned them and they said that even though I had paid the deposit back in March, because the agent had not paid it into the DPS until 6 months later, I could not start to re-claim until the DPS had held the deposit for at least 28 days. Meaning I cannot even start the procedure to re-claim for nearly another 3 weeks.

Talk about lose lose for the tenant.

Am I reading this right?

The agent can legally sit on the tenant's deposit until the tenant gives notice, then the tenant is penalised because he can't get his deposit back until the DPS has sat on it for another 28 days, after the agent has decided to pay it into the scheme?

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Report the agent/landlord. The deposit is to be paid into the scheme, not sit in their bank account for 6 months.

The whole point of the scheme is for an independant body to hold the money for the duration of the tennancy.

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Three weeks after I gave notice I would not be renewing, so only days before the end of my tenancy, I got a letter off DPS, giving details of my deposit and saying...

"Date deposit received : 1st April 2011." so I assumed that was when it had been paid into the DPS by the agent.

It looks like you have a straightforward claim for 3x the deposit because the landlord hasn't provided the "prescribed information".That the DPS has sent it is irrelevant.

It will take a while to get it back throught the courts though but you'll get 4x deposit back.

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It looks like you have a straightforward claim for 3x the deposit because the landlord hasn't provided the "prescribed information".That the DPS has sent it is irrelevant.

It will take a while to get it back throught the courts though but you'll get 4x deposit back.

Nope. You haven't been paying attention to the recent court judgements which have pretty much eviscerated the penalties for not complying with prescribed information or deposit protection requirements. Currently the legal situation is that the landlord can protect the deposit at any time (including after the tenancy has ended) without facing the 3x deposit penalty. Some landlords are now routinely not protecting deposits until and unless the tenant launches a claim for the 3x deposit, at which point they can lodge the deposit and the claim will be struck out.

Read up on Tiensa vs Vision Enterprises

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I'm aware of the case in question.

There is a difference between the LL supplying the information late but during the tenancy, and not supplying during the tenancy. It's not possible to supply the information to the tenant once the tenancy has ended. Additionally there is a requirement with regard to the "initial requirements" of the scheme which would seem difficult to comply with after the fact.

I'll see if I can dig up some more info later.

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Thanks for your comments all.

It all seems very complicated, so I am interested in any info you have.

I intend to complain about this, but not sure who to, and I it looks like it still means I have a long wait for my deposit to be returned whatever I do now. :rolleyes:

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I'm aware of the case in question.

There is a difference between the LL supplying the information late but during the tenancy, and not supplying during the tenancy.

Not according to case law. Try reading a bit more closely.

The Court of Appeal said the issue was the circumstances in which sanctions must be imposed. It looked at three possible time limits for providing the prescribed information:

– within14 days, before a tenant lodged a claim, or before the case was heard.

The court ruled that so long as a landlord has protected the deposit with one of the schemes, and given the required information to the tenant, before a court hears the claim, then the tenant is not entitled to the penalty payment.

They can give the information as late as they like, even after the tenancy ends. As long as the information is given before the court case ends, then no penalty will be awarded.

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They can give the information as late as they like, even after the tenancy ends. As long as the information is given before the court case ends, then no penalty will be awarded.

Thanks for clarifying that.

How very unfair.

So basically the letting agents can just sit on these deposits all through the tenancy, meaning the tenant then has to wait an additional 28 days to get it back from DPS. (like I have to now).

So I guess all agents now will be doing this, as there is no penalty whatsoever for not lodging it within a set time period, other than before a court case ends. :rolleyes:

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The Court of Appeal said the issue was the circumstances in which sanctions must be imposed. It looked at three possible time limits for providing the prescribed information:

– within14 days, before a tenant lodged a claim, or before the case was heard.

But it didn't look at events after a tenancy had ended. It's likely Tiensia wouldn't apply for a variety of reasons though without seeing the tenancy agreement it's hard to say definitively.

The court ruled that so long as a landlord has protected the deposit with one of the schemes, and given the required information to the tenant, before a court hears the claim, then the tenant is not entitled to the penalty payment.[/color][/b]

They can give the information as late as they like, even after the tenancy ends. As long as the information is given before the court case ends, then no penalty will be awarded.

However Hashemi does (this one I wasn't aware of).

http://www.bailii.org/ew/cases/EWCA/Civ/2011/604.html

You can't bring a s214 claim after the tenancy has ended which is precisely the time that you are likely to need s214.

"Anomalies of this kind are avoided by reading s.214(1)(a) as meaning that the initial requirements of an authorised scheme have not been but are still capable of being complied with. This is consistent with the decision in Tiensia and is the only meaning which ties in with the two alternatives in s.214(3) continuing to be available. In practice, this means that the grounds for a s.214 application will cease to exist once the lease expires and no order under either s.214(3) or (4) can therefore be made after that date. From that moment on the application will cease to be "such an application" as is described in s.214(2)."

Note how they've amended the act by adding the bold part.

This effectively renders the whole scheme toothless.

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So basically the letting agents can just sit on these deposits all through the tenancy, meaning the tenant then has to wait an additional 28 days to get it back from DPS. (like I have to now).

So I guess all agents now will be doing this, as there is no penalty whatsoever for not lodging it within a set time period, other than before a court case ends. :rolleyes:

No, it's worse than that. Effectively the LL or agent is under no requirement to protect the deposit unless a tenant threatens court action during tenancy.

I wonder how much longer the tenancy would last if you threaten the LL with legal action.

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Erm ...

If there's no dispute about your deposit, why is the protection scheme involved at all?

Because the most popular deposit protection scheme is the DPS, which holds the deposit on behalf of the landlord - and only returns it once, all parties, landlord, tenant and the DPS have jumped through all the relevant hoops. In this case, the problem has been that the first hoop the DPS has to jump through is that the deposit must have been protected for a minimum of 28 days!

Once a repayment request has been submitted, it can take 14 days when everything goes smoothly. If anything is a bit unusual - e.g. the tenant was an overseas vistor and has gone back overseas - then there may be huge problems.

E.g. I let my old home, when I moved for a temporary work placement; some mature overseas students rented it for a year, and then left back to China. We tried to come to a sensible arrangement over the deposit - but no matter what we did, the DPS would need 10-14 days to return the deposit. I couldn't reasonably arrange for the deposit to be returned 2 weeks before the tenancy ended, so that it could go into their UK bank account; that would defeat the whole object of the deposit.

The DPS couldn't arrange for it to go to their China bank account. Being reasonable, I decided to deal with everything at check out, and when they handed me the keys, I handed over the cash.

Of course, the problem was that the tenants promptly disappeared off to the airport, and thence to China, where their UK SIM cards were promptly binned.

So, now with no way of contacting them, and no forwarding address that I can give to the DPS, I'm basically screwed, as they won't now return the money - as the money can only be returned to the landlord with explicit permission from the tenants. There is a "claim form" for missing tenants, but it requires a statement of arrears that are to be claimed, and a signature from a magistrate. In other words, it's a massive ballache, and takes months - and, as there is no actual damage, and the deposit was returned in cash, there is no "evidence" of any "arrears" to back my claim.

Next time, I'll use mydeposits.co.uk. They are very expensive, however. £30 for each tenancy agreement, or alteration thereof. In effect, as both my tenants and I had liked the flexibility of 6 month tenancies - this effectively works out at a tax of £60 per year.

Basically, the deposit protection services don't genuinely help anyone. They are inconsistent and often unfair in their arbitration, with no way to appeal an incorrect decision. There is substantial admin involved with dealing with the protection services, and the more professional ones charge substantial fees (a tax by another name). Both as tenant, and landlord, I've found them unhelpful and obstructive, the typical features of some nuLabour make-work scheme.

Edited by ChumpusRex

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