Landlord taking deposit in lieu of one persons rent

Ted3

Hi,

Apologies in advance if this is a frequent question, but I thought it would be best to share the specifics of my situation.

I'm looking for advice on how to best proceed in this situation.

I have lived in an HMO flat on a short assured tenancy agreement with 5 people, one of whom moved out in January and did not find anyone to replace him, and nor did the landlord. The lease ended in September.

We now find out, via Letting Protection Service, Scotland, that 5 months rent is owed, and they are 'offering' us £0 of our deposit back. Clearly the rent is entirely owed by this tenant.

We have had no discussion about this offer with the Letting Agency prior to this offer coming in. There is no indication they have contacted the person in arrears, or his guarantor.

Clearly, the other four of us- good tenants, are quite angry about this, but would like to proceed correctly towards getting our deposit back.

I understand with the HMO we are all 'jointly and severely liable' for all rent, but what then is the point of the guarantor, and what rights to we have as good tenants in this situation? The implication of this situation is that anyone can move into an HMO and have several months free rent.

Thank you for any advice,
All the best,
Ed

Pixie5740

As you've said, you are all jointly and severely liable for the rent. If one doesn't pay then the LL can get the money from the rest of you.

When this person moved out without finding a replacement it wasn't the LL's responsibility to do so. The rest of you could have found someone.

You could try taking the person who owes the money to small claims court.

mrginge

What agreement did you come to with the tenant who left?

Ted3

We came to no agreement with the tenant who left. We were under the impression he would continue to pay his rent.

G_M

If you all signed a single joint & several contract, you are all equally liable for the full contract rent. There is no 'his rent' or 'your rent'.

If you each signed seperate contracts in individual names, then you are each only responsible for your own rent.

As a tenant in a joint & several tenany, you should ensure the full rent is paid each month. Ignorance (ie of your joint tenant not paying his 'share') is no excuse.

The LL has no obligation to chase the tenant concerned. He can chase any one of you, or all of you. Since the deposit is there (amongst other things) to cover rent arrears, why should the LL go to the considerable trouble of chasing a tenant who has disappeared?

The guarantor presumably can be made to pay any amount you (jointly) fail to pay which is not covered by the deposit.

Note: my understanding is based on England, but I doubt the above is different in Scotland.

mrginge

Ted3 wrote: »

We came to no agreement with the tenant who left. We were under the impression he would continue to pay his rent.

Hmm...
Maybe he was under the impression that he would be replaced and didn't have to?

You really should be directing your efforts at him rather than the landlord.

stator

Usually HMO means separate tenancies, if so it would be Landlords problem.
If it's a shared tenancy then you're all liable for the rent as a whole
(Don't know anything about Scotland)

zhetrin

This comes from renting rooms in Singapore and that's why I avoid renting a whole unit with a group of people, unless I know each of them personally. Otherwise, I prefer to pay a bit higher but we have separate contract so when one left I don't have to get the headache to get new tenants while at the same time paying for the time the rooms are empty.

From the other side, if it was me who is moving out and none of the other tenants are talking about me having to get replacement or paying the rest of the rent, I would just leave. Why would I pay rent in 2 places (or a place I'm not even living in).

So sorry about your case. I met an ahole landlord before too with unclear contract that cost me $1500 for a common room that's why I'm pretty strict with what's written and not in the contract.

Pixie5740

stator wrote: »

Usually HMO means separate tenancies, if so it would be Landlords problem.
If it's a shared tenancy then you're all liable for the rent as a whole
(Don't know anything about Scotland)

In Scotland a HMO is 3 or more unrelated persons living together. It has nothing to do with what type of tenancy is in place. It's common for those living in a HMO to have a joint tenancy such as in the OP's case.

bowlhead99

I haven't really got anything to add beyond what's been said by others, but just a few thoughts. For example:

Ted3 wrote: »

...Clearly the rent is entirely owed by this tenant....

...I understand with the HMO we are all 'jointly and severely liable' for all rent...

As you can see, those statements don't work together at all, right? Morally, the person who stopped paying, should have continued to pay or agreed with you an alternate solution (e.g. a replacement tenant that you wouldn't have minded living with). However, legally, it is your joint responsibility to pay the rent on time and if that doesn't happen, the landlord can chase each of you to get it paid.

If someone moves out, the rest of you get more time in the bathroom, more space in the kitchen, a guest room for visitors or a storage room or more entertaining space for parties. The total rent bill doesn't change if you all signed a joint tenancy; if you don't want to be left with more space for several months at an extra cost, you need to make suitable arrangements (like confirming the person leaving will definitely remember to keep paying rent, or working together to find a replacement, or agreeing between you that the rent shortfall will be first deducted from the leaver's share of the deposit - if it looks like it will fit, but clearly in this case it wouldn't)

, but what then is the point of the guarantor,

Imagine if you didn't pay your share of the rent, or you all moved out and nobody paid. From the perspective of the landlord, the guarantor is simply another person he can chase to collect the rent, as someone who has signed up to stand in the shoes of one of the actual tenants to be chased for the collective obligations of the tenants even though the guarantor didn't get to use the property themselves. More people to sue for non payment of the debt is a good thing in the landlord and perhaps he would have charged you all a bigger rent or taken a bigger deposit or not rented you the place at all, if a guarantor wasn't available when you were all signing up.

It doesn't mean the landlord will single out that guarantor or that departed tenant to go chase them for the rent. By taking the unpaid rent that you all jointly and severally owed him, out of the deposit that he owed all of you, he has got his money, so he doesn't need to do any chasing of anybody.

and what rights to we have as good tenants in this situation? The implication of this situation is that anyone can move into an HMO and have several months free rent.

Imagine if I open a joint bank account with you. We agree between ourselves that we will each fund it equally and spend it on bills that we jointly owe for stuff. We tell the bank that it's our joint account and sign up to be jointly and severally responsible for any overdrafts or charges.

If we both put £1 in, and then I go and withdraw the whole £2 myself... I have screwed you over, but the bank isn't complaining. If I withdraw £3, the account goes £1 negative, and the bank can then chase either one of us to make the account good, probably whoever is easiest to trace or most likely to pay up because they don't want a black mark against their name - which may not be the person who took out the cash. That's just how joint responsibilities work.

"The implication of this situation is..." that anyone can get a joint bank account with anyone and then empty it, leaving the other to pick up the bill. Which is why you shouldn't take the decision to enter into joint contracts, lightly. Same thing applies to renting houses. Plan ahead what you will do if it goes wrong or someone feels they have been done over.

As the landlord or his agent have offered to settle and don't need to do anything else, they are pretty much out of the picture. The advice in the first reply to take the person who has left to small claims court, is the only way you will get anything out of this.

If you have a copy of the joint tenancy agreement (and your landlord or his agent will hopefully have a signed copy if you lost yours) you can show that you were all jointly liable including the person who chose not to carry on using 'their' room; and with bank records from the rest of you (together with, ideally, a receipts log from the landlord if you can keep them onside) you can easily 'prove' that you paid proportionally much more than the other person.

Any claim will still to an extent be 'your word against theirs' but if you have all your paperwork showing what you paid and showing that they were jointly liable for it, and they don't have anything in writing to show they had been released from being liable for it, you would hope that sense would prevail. Their payments up to the time of exit would show what they were initially paying per month and their share of the rent until the tenancy ended would hopefully stack up with what the landlord says was owed at the end.

Info about Scottish small claims court process (via sheriff's court) here: http://www.adviceguide.org.uk/scotland/law_s/law_legal_system_s/law_taking_legal_action_s/what_is_a_small_claim_scotland.htm ; http://scotland.shelter.org.uk/get_advice/advice_topics/complaints_and_court_action/raising_and_defending_actions_in_court/small_claims_actions

Process can be done without a solicitor but if you all work, someone will need to take time off work to show up at court and present the case. If it's a significant amount of cash it would be more worth it, than if the shortfall is just a couple of hundred pounds a month times five months split between the five of you that suffered the effect of the shortfall. You would have to decide if it was worth the hassle to chase.

Of course, being right and getting it found in your favour doesn't mean you will actually get your cash from the departed tenant because they might not have any money or any income or just not pay it, but assuming they do have some money and income they will not want to be in trouble with the court - and therefore have not 'got away for free.'

Ted3

Thanks for all of your responses. I am contacting the landlord to seek assurances they have properly contacted the individual and his guarantor.

I understand the letting agency's position if they reject our claim, but it would certainly be preferable to know that they made some attempt to extract the owed amount rather than having to do so ourselves.

It is also very useful- if it comes to it- to know that we can go through a small claims court, and use receipts to show our case.