Small claims court

[bdh198]

I would be grateful for any comments anyone might have who has been in a similar position.

I have a tenant who has recently moved out leaving two months unpaid rent to the value of about £1700. He initially said he was refusing to pay the rent because he had problems with the plumbing. However, whenever we tried to sort the problem out he would fail to return our calls or emails and did not co-operate with the plumber to get the fault fixed. The fault was a fairly minor fault which was simple to fix and certainly did not justify retaining the rent (it was low water pressure in the taps in the sinks in the bathroom. The taps nevertheless did allow a flow of water, just with very low pressure).

When he refused to pay the rent he told my agent that he was putting the money into a third party bank account. He eventually moved out when his tenancy came to an end. He then demanded he get the last month for free as compensation for the loss of enjoyment! To be honest, I took a practical approach and realised it was probably not worth getting worked up about and made him the offer of the last two weeks free. He would still have to pay the unpaid rent for the proceeding six weeks, and I felt it was a small price to pay to see the back of a difficult tenant. My agent put this offer to him and he agreed.

However, three weeks later he still has not paid. He was supposed to pay last Friday, but no money has been received. Considering he told me and my agent that the money was in a 'third party' account I don't see why there should be any delay in paying the outstanding rent. The only conclusion I can come to is that he has no intention to pay (or at the very least is avoiding paying for as long as possible). I also suspect he was struggling to pay the rent three months ago and that's why he tried to make an issue out of the water pressure.

I have told my agent that if he doesn't pay within seven days I shall be pursuing the entire amount outstanding for the entire eight weeks, including my expenses that have been incurred from his late payment (so far £45 for late mortgage repayment), through the small claims court. My tenant regarded himself as a professional, and had a clean credit history, so the threat of an adverse finding (CCJ) would be a powerful incentive for him to take the proceedings seriously.

I would be grateful if anyone has any thoughts on my situation, or has any advice generally about pursuing a tenant for unpaid rent through the small claims court.

Thanks in advance

[Richlist]

Assuming you have no rent guarantee insurance and no guarantor for your tenant, the property is in England or Wales and let on an AST then the next question is deposit ?

I assume it was protected via/ through the lettings agent ? If so, what has been done regarding the return of the deposit ?

[Carryon Regardless]

If your confident he has or will have ability to pay, already questioned by yourself, court is worth considering.

Putting more dosh into chasing dosh is always a risk, win and will you get paid.

It doesn't sound like there is a reasonable defence.

Demonstrating your offer shows your effort to compromise, but then don't expect more from the court (aside from costs).

Can you demonstrate his acceptance of the offer, and agreement to pay ? This would be in your favour.

Your losses due to lack of payment are your problem don't expect consideration by a court.

[Melboy]

The only conclusion I can come to is that he has no intention to pay (or at the very least is avoiding paying for as long as possible).

Yes that is where you are Solent. He is taking you for a Mug Landlord.

Mel.

[bdh198]

Thanks for the replies

I don't have rent guarantee insurance, but this has opened my eyes to how valuable it is and I will be putting it in place. I assume the premiums are allowable expenses for income tax?

The deposit will help, but still falls quite a way short of the entire outstanding amount.

The offer was accepted by the tenant through the landlord. I don't believe this is recorded in writing, but my agent has told me they have a clear record of the conversation.

I'm alive to the risk of potentially flushing good money after bad through court proceedings, especially if the tenant is in financial difficulties, but in this case the tenant seems to have a lot to lose from an adverse finding and I'm hoping he will wake up and find a way of settling the outstanding debt before it gets that far.

[Richlist]

I don't have rent guarantee insurance, but this has opened my eyes to how valuable it is and I will be putting it in place. I assume the premiums are allowable expenses for income tax?

Yes it is.

Any expenses incurred in running the business are tax deductable. ......car mileage, telephone, ISP, books, photocopying, capital allowances, computer software, advertising, car parking, insurances, stationary, printer cartridges, etc etc etc.

[collections4]

Thanks for the replies

I don't have rent guarantee insurance, but this has opened my eyes to how valuable it is and I will be putting it in place. I assume the premiums are allowable expenses for income tax?

The deposit will help, but still falls quite a way short of the entire outstanding amount.

The offer was accepted by the tenant through the landlord. I don't believe this is recorded in writing, but my agent has told me they have a clear record of the conversation.

I'm alive to the risk of potentially flushing good money after bad through court proceedings, especially if the tenant is in financial difficulties, but in this case the tenant seems to have a lot to lose from an adverse finding and I'm hoping he will wake up and find a way of settling the outstanding debt before it gets that far.

Hi Solent

I understand your risk of flushing good money after bad with regards to court proceedings, a very cost effective alternative that may be worth checking out is available at www.collections4Landlords.co.uk.