Is this an ethical way to pay this debt ? will this work?

katesheet

A tenant is renting from private landlord.

Tenant claims housing benefit (money from the council) to pay their rent.

They rent to a Private landlord.

Tenant receives the Housing benefit payment Direct to the tenants bank account, and then pays the Land lord via a standing order every month.

This has happened,

Looks like the tenant has had a serious problem regarding the property things. There was a boiler issue and it exploded, so no hot water. This damaged the walls causing damp etc.

Also due to this the electrics exploded so damaged more walls.

Due to this the place has to be fully dried and refurbished.

The whole place will have to be emptied, and will torn apart and then dried and then after it is dries re-plastered. It takes time to dry. Especially in this cold weather it will take ages to dry.  Then the electrics rewired (as water will most likely be in the wires)

Nobody was hurt

Rent

For simplicity, Let's say the rent is £400 a month, paid from council to tenant, and then tenant to landlord.

The builder/plumber Work to renovate costs £800. (this figure is for simplicity for my questions below)

Flat is empty (tenant has moved all their stuff out, so they cannot live in it, no bed etc)

Landlord has the keys from the tenant, who passed them on happily after the place was empty.

They keys passed on to the builder, who will be carrying on the work for 6-8 weeks.

Why 6-8 weeks? the place needs to dry thoroughly, and it is cold and frosty.

Plaster walls to be broken off,  plaster walls stripped, place dried, 

then after weeks of drying, new electrics installed, new plaster boards put new boiler installed

In those 2 months the tenant will be  living in with family for Free/ no extra cost

The council/housing benefit wont know about this. As far as the council are concerned

the tenant will still be living there for them 2 months and receiving council housing benefit.

It is to be determined of there was any negligence,  and if the insurance doesn't pay for the cost, then the landlord will probably want the refurbishment money from the tenant.

* Deposit held by the deposit scheme of £400

Here are questions, coming up

Would this following work, as a form of a payment plan? (Let’s assume the landlord agrees that is)

For the next 2 months, the tenant lives with family (for free). 

The tenant doesn’t tell the council about the incident, As they wont tell the council about it. As far as the council are concerned the tenant will still be living there for them 2 months and receiving council housing benefit.

Would this work as a payment plan

The 2 months which the tenant will be absent from the property (as the landlord has the keys, and the tenant has no bed there) – the tenant keeps this 2 months of  housing benefit  (2 x £400 makes £800) to himself.

The tenant can this offer this £800 to the landlord for the payment of the £800 builder/renovation cost.

So in away the tenant is paying the landlord for the repair work, with council money.

In those 2 months the Landlord shouldn’t really get rent money as the tenant is not living there (due to no bed, no keys) etc, and the tenant is living with family in them 2 months.

So the 2 months of £400, making £800, he can offer it to the landlord as a payment for the repairs? That is the main question.

let’s say the landlord agrees to this then  Is this a way to pay the £800 repair cost/debt by the tenant to the landlord

* Would It qualify for the £800 to be paid this way? 

or is it just like paying the Landlord rent every month as usual (like the tenant was still living there) every month as normal,?

But how can it be like paying the landlord as normal, if the tenant isn’t technically even living there for them 2 months, and the place is empty? And they are living with family?

Obviously as pointed out before, the council/housing benefit depart Wont know about this.

Tenant cannot afford to pay for these damages as an extra additional payment.

And would like to carry on living there after the work, as they were before.

and after the work is done, the tenant can move back in with belongings, bed, keys given back to them.

Is it an ethical way to pay the debt?

Would you do personally this, to pay the debt personally ?

Is this technically paying for the works of the debt? Or because it is the monthly amount of landlord rent, then the landlord is just getting his rent, so wouldn’t qualify?

or can he accept the payment, but still say that this £800 is not really paying the renovation cost is it? 

but why should he get 2 months of rent, when the tenant is not even living at this landlords property?

If you were a landlord would you agree to this as a payment?

Any other pointers you can give?

Has anyone been In this similar situation before? What was your situation and how did it get resolved ?

Thanx  xxxx

added info:
The property is in a block of flats which have a block management team. Would this block management team have their own insurance for the whole of the properties within the block, so their insurance could cover it?
if so, would the same be applied as the landlords insurance, which is that negligence would have to be proved?
or because the block managements insurance will have a more bigger range of insurance then they the blocks insurance would be willing to cover the cost?  

 If so before this, would they send in their own specialists to see the damage? or sending them photos would suffice ?

Karonher

Firstly, was the tenant negligent? You say it looks like they have been and yet that they are denying it. From the link below it does not seem illegal for the housing benefit to be received but it should go to the landlord as normal if they request it. In that case it could not be used to pay for the repairs.

https://england.shelter.org.uk/housing_advice/benefits/universal_credit_housing_element_when_away_from_home

katesheet

Karonher said:

Firstly, was the tenant negligent? You say it looks like they have been and yet that they are denying it. From the link below it does not seem illegal for the housing benefit to be received but it should go to the landlord as normal if they request it. In that case it could not be used to pay for the repairs.

https://england.shelter.org.uk/housing_advice/benefits/universal_credit_housing_element_when_away_from_home

 modified the post, until I have further info to tell.

Thanx for the reply Karonher xxxxxx. 

madaboutspots

I can't see why the landlord would agree to the "rent" being used in place of covering the repair. From the landlord's perspective they have potentially lost 2 months rent AND have a big repair bill. I would expect the landlord to want the place up and running as it was before and with no break in rent or additional bills. Also - does the 2 month's rent actually cover the full repair bill or could it leave the tenant in debt to anyone?

However...

The landlord should have cover on their insurance that pays out for this. It won't likely make them happy to have to claim but it's a risk, just like anyone insuring their car to drive and hoping not to actually have anything happen to  claim on the insurance.

The landlord would have to surely prove the negligence? In order that is done fairly and not just a mate/favourable contact of the landlord I would suggest several (3 is normal) separate quotes and a fair middling price agreed IF the tenant was found liable though even then it surely would have had to have been wilful. The quotes need to be provided in advance of the work as once the work is completed it's landlord's word against tenant's. 

Of course the entire incident could sour the relationship and cause further issues that make it uncomfortable for the tenant to stay.

Each party needs to get everything in their own "defence" in order and in writing. If I were the tenant for example I wouldn't engage in phonecalls with the landlord but converse by email/written only. This way should protect both parties from untruths being pushed as truths. If needs be there is a free and impartial ombudsman service to resolve disagreements between both parties. It took a while before Covid so no doubt now will take a while longer.

If the tenant gets the landlord to agree to the proposal I would get it in writing very clearly stating that the payment is offered AND accepted as full and final settlement for the issue - importantly I think, without acknowledgement by the tenant that they were at fault (unless this is proven). Just in case this crops up again later for any reason. If you're looking at it from the landlord's position you could argue doing the exact opposite of above could be preferable if the landlord wants a reason to evict/increase rent or just be difficult. 

A fair tenant and a fair landlord should really want to protect themselves, each other and the circumstances/resolution for the sake of all. It doesn't sound particularly amicable so far though. Either the tenant has made a mess of the place through neglect/abuse or the landlord feels they did - or.... They don't have insurance and don't want to lose money. There could be other possibilities but I can't think of them just now.

If you could indicate if you're wanting the best approach for which party (tenant or landlord) it could help. 

Is there an agent involved? Even if the landlord only used an agent for advertising and credit checks it could be worth the tenant going back to said agents and making them aware of the situation and ask advice/mediation. 

As long as the rent from the council being paid to the landlord via the tenant is above board/legal and the tenant keeps on the right side of the rules/law they should have a strong stand. 

Also... How old was said boiler? When was it last serviced? Has the landlord got their gas safety certificate valid - pretty sure it's needed every 12 months. Were there any advisories on the last service/inspection etc.

The tenant certainly doesn't want to be just offering up cash willy nilly without checking various facts, asking for proof of certain things and getting full and final agreement before paying. Mediation via the ombudsman might help bring a fair and reasonable although not speedy resolution to matters with no chance of either later dragging the issues back up. Again though - landlord should have insurance. Get proof they have it, proof the insurance won't pay (and why), proof it was caused by wilful negligence, proof of a valid gas safety certificate, proof of damage/costs, proof of boiler service/make/model/service history. Has the boiler a known manufacturers general recall or issues that could/should have been fixed but weren't? All that before even offering to hand over money. 

If landlord takes 1 week to provide something it would be fair for the tenant to have the same grace period to check/respond once info is received. It's not fair for example for the landlord to drag their heels over getting their side sorted and then pressure tenant into a quick response. Harassment on either side is not reasonable. 

Who's idea/suggestion was it for the tenant to hand the keys back and effectively move out? It could be argued they left without formally terminating the rental agreement and are in breach of their contract. Likewise if the landlord suggested this action. It's not a great start to resolving things. What if the tenant pays 2 months' rent for an empty pad and then finds they aren't allowed back in? What do they do then!? What happens if the landlord argues the tenant just buggered off and won't pay rent or repairs? The landlord should never need the tenants keys whilst there is a tenancy agreement in place. I had my own set for my flat, 2 X tenant sets for couples and 1 X agent set for agreed checks/work etc. 

Hope that makes some sense. 

madaboutspots

Oh and the landlord would want the rent because they can't let out the place. If the tenant has handed their notice in there would be no rent break if the landlord has the chance to find a new tenant. Not really possible to move someone in straight away given the boiler issue.

Also.... Sorry for super long post! Hope you can get your head round it. ... Proof, proof and more proof. Written reports, photos - everything. Protect yourself whichever party you are - or friend etc. 

madaboutspots

I used the ombudsman service some years ago. Cost nothing. Landlord wasn't allowed to touch the deposit until after the resolution was proposed by the ombudsman and accepted by both parties. I had evidence the landlord was trying to screw us over on everything and the ombudsman's verdict was as such and we both got a full copy of the report. He got told off, we got our deposit back. I would guess if this landlord keeps getting into tricky situations with the ombudsman it'll start showing up as a pattern - same can of course be said for the tenant though harder to see the pattern as one is for a fixed address/person and the other maybe moves around? Worth thinking about though if you want to protect a future reasonable party from coming a cropper from the unreasonable one here - if there is one. 

katesheet

Thank you very much madaboutspots xxxxx

we are the tenant party  


Another thing, I will add above.
The property is in a block of flats which have a block management team. Would this block management team have their own insurance for the whole of the properties within the block, so their insurance could cover it?
if so, would the same be applied as the landlords insurance, which is that negligence would have to be proved?
or because the block managements insurance will have a more bigger range of insurance then they the blocks insurance would be willing to cover the cost? 

 If so before this, would they send in their own specialists to see the damage? or sending them photos would suffice ?

madaboutspots

It's most likely the management team manage the communal areas only. Painting/lighting stairs/lift, upkeep of any road/track. They are very unlikely to deal with the intricacies inside any privately owned property. 

When I had a flat I rented out the management company just sent me bills - lots of them - for various stuff. Other than that they were no use at all. No harm in asking some of your neighbours if they have a similar aged boiler - perhaps from when the flats were built. Depends on the age of the place really. Boilers can/do last 5 years or 20+ 

madaboutspots

Also... Just photos isn't enough to offer proof. You'll need the regular report for the state of the boiler. One from when you moved in to prove what order it was in the then and the most recent. If for example you've had a massive lockdown rave and a friend (!?) had taken a baseball bat to a perfectly new and working boiler and smashed it then it might be obvious. But if it's developed a fault which you are not trained or knowledgeable enough to realise and the latest service is overdue, the landlord's knees will be knocking. 

katesheet

Do management teams have full buildings and contents insurance for the whole of the properties in the block?
so this insurance might be able to get involved?

Also
if the landlord insurance wants to get involved to speak about the issue, would they most likely want to speak with the tenant on the phone/ email? or not really

if the block management insurance wants to get involved to speak about the issue, would they most likely want to speak with the tenant on the phone/ email?  or not really

thanx xxxxx

madaboutspots

The management team and insurance company both have their contract with your landlord, not you. I can't see why they would want to engage with yourselves.

The management company are likely to insist on arranging the buildings insurance but the landlord should most likely be free to choose their own insurer for their privately owned property within said building.

If you try and see the block of flats as having communal/common areas that all can access and private areas behind each individual "front door" - that would be a general rule for demarcation of responsibilities.

The management company probably manage a large number of properties/blocks of flats and other buildings and deal in the general/common areas. A person turns up, buys a flat from whomever is selling and then chooses for themselves if they want to live in it or rent it out. It's no-one's business but that buyer what they do - unless there are rules like pets/noise etc. An exception might be if the landlord owned the entire building and rented it all out but that doesn't seem the case here from what you've said so far.