Advice re. new tenants

[Karen Cinders]

The tenants in one of our properties moved out last Tuesday.

We have advertised it and had a dozen prospective tenants come to view.

All liked the property but one lady had a daughter moving back to the area and said she could have the deposit £450 with us and two weeks rent £230(from 17th to end of Dec with us the next day.

Obviously we checked on the reference we were given and she duly fetched the said money. I said I needed to clean and the house keys would be available from the 17th. We also got her to sign a 3 month lease dated from the 17th.

Last Tuesday when previous tenants were moving out I had a text from the mother saying she was buying fridge from previous tenant for £55 but she was at work all day......could I pay previous tenant when I gave him deposit back and she would reimburse me.

I did this and text her to let her know.

A couple of days later I text and asked about handing keys over on 17th and her bringing me money for fridge. No responce.

Two days later i had another text saying sorry she didnt make it as she had been in hospital as she had been bitten by a dog.

I thought I would leave it and she could contact me on the monday 17th about her daughter moving in.

Monday came with no communication.

I text again on the following day and she got back to me saying she had diarrhoea and sickness which still told me nothing of the plans to get keys.

We are now on 19th Dec and despite both me and OH ringing both her and her daughters phone we have still had no communication from them.

I rang Mother and spoke to new tenants sister who only answered because I rang from a number not known to her and when I asked why her sister is not taking our calls she muttered something about her phone not getting a good signal. Even for texts I asked? And she just laughed.

As you can imagine I am beginning to have bad feelings about these prospective tenants and wondering if this is a prelude to chasing them for rent if they ever do actually move in.

Thinking of telling them that our situation has changed and we may have to sell the house, but where do we stand legally as she has already signed contract?

I understand she may not want to move in on top of Christmas but the lack of communication is ringing alarm bells in my head.

In hind sight we shouldnt have got her to sign till we actually handed over the keys but you learn by your mistakes. My last words to daughter were. "Can you get one of them to ring me please!"

Still have heard nothing.

Any advice would be appreciated.

[Richlist]

In my opinion you've made a number of mistakes.....

All liked the property but one lady had a daughter moving back to the area and said she could have the deposit £450 with us and two weeks rent £230(from 17th to end of Dec with us the next day.

Wether she likes the property is of no importance. Getting the money to you the following day is no criteria on which to decide on her suitablity.

Obviously we checked on the reference we were given and she duly fetched the said money.

One reference ? Are you kidding ?.......bank, employer and previous landlord should be provided. Better still take rent guarantee insurance and they will set the reference criteria for you.

I said I needed to clean and the house keys would be available from the 17th. We also got her to sign a 3 month lease dated from the 17th.

A 3 month lease ? AST's can be for any length of time but the tenant always has security of tenure for a minimum of 6 months.

Last tuesday when previous tenants were moving out I had a text from the mother saying she was buying fridge from previous tenant for £55 but she was at work all day......could I pay previous tenant when I gave him deposit back and she would reimburse me.

Never do these kinds of 'favours'.....your not a monylender. Its a business relationship so keep it businesslike.

[Melboy]

I think you have had a lucky escape.

Drop this prospective tenant and start again and this time take heed of what Richlist has replied to you by way of advice. Do NOT do 3 month tenancy.

If you have any other questions do not hesitate to come back to the forum for impartial advice.

[Karen Cinders]

Thank you both for your input and yes I think we were too hasty and have learnt a lot of valuable lessons from this but where do I stand legally as she is not in possesion of property keys and still has not got back to me regarding anything!

Can I change my mind even after she has signed contract because i really dont want these people as tenants and think it would be easier to get out now rather than when they are in the house and I am chasing them for rent.

[kerbut]

I don't know the legality of it, but as they don't have keys they cant get in can they, maybe you could spend a few pounds and use Rentchecks.com or Experian to do a check on them and hope and pray they come out negative and that's your get out clause as the checks were negative.

Edit :Spelling mistake

[Richlist]

I don't understand why you only take 2 weeks rent......

As I see it rent has been paid, deposit has been paid, contracts have been signed ( the tenant has presumably been given a copy) therefore there is a binding contract in place that can be evidenced. If you took legal action there is every chance that you would win.......What you would win depends on wether the tenant has any money or assets. You would of course need to protect the deposit and issue the correct notices.

However, if you don't want to proceed you will now need the reluctant tenant to sign a document saying that they are surrendering the tenancy.

[Melboy]

With a signed contract and paid-up deposit and rent payment this tenant has the upper hand on the situation so you would need to be very careful how you go about any change of plans. This tenant need do nothing at all, they do not have to occupy the property, keys or no keys.

What I would do is to send an informal polite text saying that if they have had a change of mind or circumstance then you would be prepared to refund all monies received. If they still want to take the tenancy on then they must make contact with you re-keys and payment (cash) for fridge before Christmas as you will not be around for Christmas week. See what the outcome of that is.

[Karen Cinders]

With a signed contract and paid-up deposit and rent payment this tenant has the upper hand on the situation so you would need to be very careful how you go about any change of plans. This tenant need do nothing at all, they do not have to occupy the property, keys or no keys.

What I would do is to send an informal polite text saying that if they have had a change of mind or circumstance then you would be prepared to refund all monies received. If they still want to take the tenancy on then they must make contact with you re-keys and payment (cash) for fridge before Christmas as you will not be around for Christmas week. See what the outcome of that is.

Thankyou Melboy think I will try that.

If as I suspect I again don't get a response where do I go from there?

[Karen Cinders]

Thankyou Melboy think I will try that.

If as I suspect I again don't get a response where do I go from there?

Ok so the ball is in their court. I have sent this message to both mother and daughter.

"hi XXXXXX, If you have had a change of heart about rental property, just let me know and deposits can be returned. Otherwise can you contact me about keys and payment of fridge by the end of today as we will be away for a while and obviously need to get this sorted. Thanks."

[Karen Cinders]

Ok so the ball is in their court. I have sent this message to both mother and daughter.

"hi XXXXXX, If you have had a change of heart about rental property, just let me know and deposits can be returned. Otherwise can you contact me about keys and payment of fridge by the end of today as we will be away for a while and obviously need to get this sorted. Thanks."

Have just had a reply and it seems her daughter is not even replying to her mother and wants to stay with the partner she was meant to be leaving. The mother has agreed for us to re let the house which is great news for me and a wake up call for future dealings with tenants.

Think I may keep the two weeks rent as otherwise we will be out of pocket and return deposit.

Thanks for all help. It could have ended a lot worse.

[Richlist]

Make sure you get something in writing that confirms the tenant is surrendering the tenancy......signed by the tenant.

I wouldn't rely on text messages alone.

The £55 fridge becomes yours.....you paid for it......unless you deduct the cost from the deposit and then it becomes the tenants property. If she doesn't collect it you have a responsibility to store it safely until such time as she does.

Good fun landlording......especially if you don't know what you're doing. It might be a good idea to find a letting agent.l

[Melboy]

Think I may keep the two weeks rent as otherwise we will be out of pocket and return deposit.

I don't think you can do this..........I read somewhere in the past that you are not entitled to do this so be careful and only take what is reasonable out of pocket expenses like the fridge etc.

[snorkerz]

As far as I can see, KC had a contract to create a tenancy with mother/daughter. MD breached that contract, therefore KC is entitled to any financial loss that that breach led to. KC would have an obligation to mitigate the loss but with a week already gone and extremely limited oportunities to re-let this week, I am sure 2 weeks rent would be okay in the eyes of the court if MD were to make an issue of it.

[Richlist]

....... KC would have an obligation to mitigate the loss but with a week already gone and extremely limited oportunities to re-let this week, I am sure 2 weeks rent would be okay in the eyes of the court if MD were to make an issue of it.

Its my understanding that there is no legal requirement or obligation that requires a landlord to mitigate losses.

I'm happy to be proven wrong if you can quote statute or legal precedent that shows that not to be the case.

[snorkerz]

Its my understanding that there is no legal requirement or obligation that requires a landlord to mitigate losses.I'm happy to be proven wrong if you can quote statute or legal precedent that shows that not to be the case.

In the case of a tenancy you are quite right - Reichman & Anor v Beveridge & Anor [2006] EWCA Civ 1659 (13 December 2006) applies. However, the tenancy never occured, therefore standard contract law applies.

[Richlist]

However, the tenancy never occured, therefore standard contract law applies

Thats the bit of this story that most of us are struggling with ie was there a tenancy or wasn't there a tenancy ?

[caravanj]

However, the tenancy never occured, therefore standard contract law applies

Thats the bit of this story that most of us are struggling with ie was there a tenancy or wasn't there a tenancy ?

I would have thought that as with any contract, it's made when both parties make the agreement either verbally, or in writing or by any electronic communication & therefore there was a tenancy.

[Richlist]

Well initially I thought that to but, Fyldeboy thinks not (and would seem to be knowledgable in these matters) and I'm now inclined to agree.

The contract wasn't completed so it didn't become a rental agreement.

I seem to remember that there are X4 elements to contracts...... offer, acceptance, intention to create legal relations and consideration. Clearly offer, intention & consideration (payment) has taken place but not I suspect, has acceptance, by virtue of not taking keys and not moving in.

Perhaps Fyldeboy can provide an explanation/ expand on how/ why ?

[snorkerz]

Well, that's an evening I won't get back.

The best explanation of the need to take occupation before a 'tenancy' can be created is here http://www.landlordlawblog.co.uk/2011/07/05/the-basic-rules-of-tenancies-before-the-codes/ but I must admit that I didn't realise that a 'deed' can over-rule that requirement, so my argument was only partially right.