Deposit Protection Service

[WhatToDo]

Hello,

My letting agency took a deposit from the tenant and insured it, with their own particulars, not ours, with MyDeposits.

The tenant did not keep to the terms of the tenancy agreement and generally made a nuisance of himself.

We looked into the deposit insurance certificate and found that it was not valid because, among other things, the particulars were not those of the landlord.

We paid another deposit in the same amount to the DPS in order to be able to take the tenant to court since he showed signs of intending to overstay the end of his AST.

He eventually left, with rent arrears, damage, and theft of furniture. The letting agency paid over his entire deposit to us in lieu of rent, etc.

We are now trying to recover the deposit we paid ourselves to the DPS. They, however, are showing signs of attempting to hang onto the money.

Their latest email states:

"I note from the correspondence attached with your Statutory Declaration that the Deposit was paid to The DPS whilst it was still being held by your Agent. However, you have provided confirmation that your Agent has returned the £XXX to you on (date) 2010, therefore the Deposit held by The DPS is now the original Deposit for this tenancy.The Single Claim Process is set down by the legislation, therefore we are required under the legislation to issue the Tenant with a Statutory Declaration Notice once a Statutory Declaration has been received."

To me this is absurd, because (1) the original deposit was paid in and has been refunded to us; (2) the money held by the DPS is an entirely separate matter; (3) there was no longer any tenancy on the date the tenant's deposit was refunded to us.

Am I correct or must I let the DPS ask "permission" from the tenant, which is what they intend to do, to refund OUR deposit, now held by the DPS?

Very many thanks indeed.

[kerbut]

Let DPS have the deposit ,refund it in full to the ex tenant and then apply to the County Court for the rent arrears and damages,the County Court has more sense than DPS and Mydeposits ( or their arbitrators) put together .

[Mortitia]

You can't pay in 2 deposits on one agreement.

It was up to the agent to register the deposit in your name as landlord and up to you to return or dispute the deposit on departure of the tenant. Why did you not contact the agent to make him account for himself or MYDEPOSITS to register a problem?

Have you been re-paid the deposit by MYDEPOSITS? This is not clear.

To answer your last question - you need to make it clear to the DPS what has happened.

Next time tell your agent only to use the DPS and make sure YOU know where it is as it is your responsibility at the end of the day.

Mortitia

[WhatToDo]

You can't pay in 2 deposits on one agreement.

It was up to the agent to register the deposit in your name as landlord and up to you to return or dispute the deposit on departure of the tenant. Why did you not contact the agent to make him account for himself or MYDEPOSITS to register a problem?

Have you been re-paid the deposit by MYDEPOSITS? This is not clear.

To answer your last question - you need to make it clear to the DPS what has happened.

Next time tell your agent only to use the DPS and make sure YOU know where it is as it is your responsibility at the end of the day.

Mortitia

[WhatToDo]

The letting agency insured the deposit with MyDeposits, but continued to hold it themselves. After the tenant left, the letting agency paid over the entire deposit to us to compensate us for damage, rent arrears, etc. (However, it did not begin to cover all the costs we incurred).

Is there any precedent with the DPS in cases where the landlord had to put up a second deposit in preparation for going to court? Has the DPS ever immediately refunded the deposit in such cases or have they always taken the position that once the first deposit was repaid to the landlord, the second deposit becomes the original deposit? Utter rubbish in my view, but wonder what legal standing I have.

The DPS is fully informed of the situation. In my view, they are taking this position in order to keep us from recovering it.

Many thanks for your help.

WhatToDo

[Mortitia]

As to your second paragraph - no I have not heard of anyone taking such action or paying a deposit in after the tenancy has ended in order to take legal action. Very strange indeed.

If you want to pursue the tenant for more damages then do it through the small claims court - hmcs.gov.uk - to find his address use findermonkey. You will have to pay the court fee to proceed.

Are the damages very great? If not I would not waste my time and move on to the next tenant. This damage thing is all a bit of a learning curve - sometimes it is just not worth the hassle of courts etc. I know that Melboy on this site disagrees with this view.

I doubt if DPS is deliberately keeping your funds - they are a government run scheme. Insist on speaking to a senior person to sort it out.

Mortitia

[Melboy]

No, I don't disagree with not moving on re-damages etc. Mortitia

What I say is yes, get the troublesome non paying tenant out and move onto the next tenant etc. BUT it is fairly straightforward now to commence proceedings against a non paying tenant without beating yourself up about it.

If that non paying tenant receives a CCJ then that is a good thing because it ruins their chances of credit or credit cards etc. AND it may go some way to another Landlord not having to put up with the same misery as perhaps you have just experienced.

Mel.

[WhatToDo]

Many thanks for all your replies.

I have now succeeded in getting the DPS to refund the deposit. However, they claim that no interest is due because the legislation was changed a couple of years ago "due to a change in base rate."

Is this true or does the DPS have to pay interest on the deposit it has held?

Many thanks,

WhatToDo