Building Factor withholding Deposits

RPO

Hello Everyone,
I'm hoping to get some advice. I'll make this short.
My Building Factor is withholding Deposits paid at the beginning of my tenancy.
This deposit is paid as a sort of float held for emergencies. After moving to a different Factor it has been made clear that no deposits will be paid to any tenants - 7 in total - until such time as they have recovered any debt owed by any of the other tenants.
Am I liable for a neighbours debt if I am myself clear and have fully paid all invoices.

davidmcn

I presume we're talking about Scotland, and flat owners rather than tenants? Any tenants don't normally get involved with the factors.

At some point the owners will have engaged the factors to manage the property on their behalf. That probably included an expectation by the factors that they wouldn't be left out of pocket at the end of the day, so I suspect they're within their rights to retain the floats until your fellow owners have stumped up their debts (and that you have a right of recovery against the debtors).

Pixie5740

RPO wrote: »

Hello Everyone,
I'm hoping to get some advice. I'll make this short.
My Building Factor is withholding Deposits paid at the beginning of my tenancy.
This deposit is paid as a sort of float held for emergencies. After moving to a different Factor it has been made clear that no deposits will be paid to any tenants - 7 in total - until such time as they have recovered any debt owed by any of the other tenants.
Am I liable for a neighbours debt if I am myself clear and have fully paid all invoices.

I think you are, yes. The non-payers become a bad debt that the rest of you will have to cover. It happened to a friend of mine (in Scotland which is where I assume you are since there's a factor although you mention tenants) a few years ago in a large new build development where there were a number of non-paying ratbags.

Rosemary7391

So you've moved to a different factor? Have they told you how much is outstanding and from whom?

RPO

Thank you everyone,
I am in Scotland and a home owner.
The consensus seems to be unanimous, that I'll be paying anothers debt. It's really concerning that one can become liable for a neighbours debt just because you happen to live in the same building. I wonder what other debts, other than my own I'm liable for.

davidmcn

RPO wrote: »

I wonder what other debts, other than my own I'm liable for.

You're not really liable for other people's debts, the point is that the blocks' owners collectively owe money to the factor.

Take the factor out of the equation - if your block was self-factored, and not everybody stumps up the required cash upfront, then if you want to get anything done the rest of you would have to pay more than your fair shares and hope you can recover the balance from your recalcitrant neighbours. Same principle here. The alternative would have been the factors simply downing tools rather than go into the red.

I presume we're not talking about vast amounts anyway? For significant expenditure they'll normally want money upfront.

Rosemary7391

When our block came up one share short I ended up paying the extra because I just wanted the work done. The missing owner paid up eventually, and the factor passed the money back to me. The point (from the factor's POV) was that I was taking on that risk, not them. Think of them as being a co ordinator rather than a lender



It does seem odd that the missing amount is exactly equal to your deposits, unless I've missed something and you've had a partial refund already?

RPO

Thank you for the reply. It would appear that even withholding the money does not cover the debt owed to the Factor.

RPO

Thank you for the reply. No it's not vast amount of money but saying that it's the principle. As a Company they took the contract to Factor the building and are surely liable for risk like any other Company. I like millions of other people for instance chose to take a Credit Card from a Company, said Company knew the risks from non payers but they do not as far as I am aware hold me responsible for paying if others do not.

anselld

RPO wrote: »

Thank you for the reply. No it's not vast amount of money but saying that it's the principle. As a Company they took the contract to Factor the building and are surely liable for risk like any other Company. I like millions of other people for instance chose to take a Credit Card from a Company, said Company knew the risks from non payers but they do not as far as I am aware hold me responsible for paying if others do not.

You are making up principles to suit your circumstances.
There are plenty of situations where joint and several liability exists.
The fault here is with your freeloading neighbours not the Company.

davidmcn

RPO wrote: »

Thank you for the reply. No it's not vast amount of money but saying that it's the principle. As a Company they took the contract to Factor the building and are surely liable for risk like any other Company.

Have you read the contract? Like I said, it would have been entered into by the whole block, not a series of individual contracts with each owner.

What does your contract with the new factor say on this point?