Guarantor Debt

user1977

eddddy said:

Flopfluppet said:

Maybe, admitting that the document was signed by his wife and accepting it was fraud may be the cheaper option - assuming that in doing so it would invalidate the agreement and mean he is not liable for any costs.

I suspect the LL would pursue her for his resulting losses, as a result of negligence, misrepresentation, etc. 

Though if it would have been unenforceable anyway even if "signed" by the husband, those losses are zero...

Flopfluppet

SS has informed the solicitor the circumstances of signing so he will advise on that. However the school gate solicitor said it would be very tricky to ascertain from an online signature who did it. The only way possibly would be handwriting experts but doubt it would go that far. He also said they are likely to view SS claim his wife signed it as dishonest and just a way for him to try and get out of the agreement. 
I know when I've signed things online it bears little relation to my signature,  don't know if that's just me?

Robbo66

propertyrental said:

Dear Mr LL

I am writing to inform you that the guarantee agreement purported to exist supporting XYZ's tenancy at (address) is invalid.

The agreement was not Executed as a Deed. None of the relevant signitures were witnessed, and I was not provided with a copy of the associated tenancy agreement prior to being asked to sign.

Having taken advice, please be advised therefore that should any claim be made against me based on the purported guarantee agreement, I shall defend the claim, in court if necessary.

yours etc

Just a suggestion

Sorry but it doesn't have to be by way of a deed, An AST can have a guarantor clause included in the tenancy agreement and as long as the Guarantor has sight of the agreement and signs it then they become jointly liable for the rent and other terms with in that agreement.

The only time a Guarantee has to served as a deed is if the tenancy pre dates the guarantee agreement.

Robbo66

user1977 said:

Flopfluppet said:

Property rental, I'm guessing from your user name that you are experienced in the rental area? Can I ask, do you think if there was no way out of the agreement for him and it goes to court, would the judge (even if he rules that SS needs to pay costs/arrears) be likely to rule that LL must now start the eviction process because the advise from school gate solicitor was that LL cannot be made to evict tenant. His advice was "you're going to have a massive expense: arrears, costs and then some and could be paying his rent indefinitely ". Surely not?

You've already had advice in this thread about how unenforceable the guarantee appears to be (signed online, not even by him!).

But yes, if it had been a valid guarantee, as discussed above the guarantor can't dictate what the landlord does with the tenant.

Online signatures acceptable as are any email exchanges and these may constitute an agreement in writing if they are signed by the guarantor or a person authorised by the guarantor.

Flopfluppet

Hello again, I did say I'd update so here is some further info. SS sent all the relevant documents to a solicitor who was one recommended by ours, who was specialised in this area. Obviously all the details of what liabilities the guarantor had were detailed correctly in the deed ( had SS have read it) and it is watertight. There is actually a lot more liability than he thought such as unpaid utilities,  council tax and refurbishing the flat if it's wrecked ( which it is) 
With regard to the deed not being correctly executed, witnesses, signature etc, the deed would be deemed invalid however it would be considered in court to be a 'simple contract' instead. 
The only bit of possible good news is that parts of the contract could be deemed unfair, but the solicitor didn't elaborate on which part/s. In summary,  she said it could still be argued the deed was invalid due to proper formalities not being completed but that the LL was likely to subject this to further dispute.  
She has therefore told SS it us worth giving thought as to whether parts could be considered unfair - presumably she wants to charge more to investigate which parts could be unfair! It already cost £2k in the end because she wanted extra information so goodness knows how much it will be. The LL has also written a letter to SS titled 'letter before action' in which he means about thinking the tenant and SS are somehow conspiring against him and this was their plan all along. The solicitor wants £1200 plus vat just to deal with that.
So in the end, it looks like more money has to be spent just to see if SS liability can be reduce even by a little. The biggest problem is LL is still content not to evict tenant and just collect his part of the rent and the shortfall from SS indefinitely. 
I don't really know if he should spend more to find out if any of it is unfair or if he is just adding to what looks like is going to be a huge bill. 
I also read somewhere else on the forum that if you are a guarantor having to pay defaulted payments,  that does go on your credit file even if there is no CCJ and adversely affect him when he has to remortgage in 3 years. Not looking good at all.

_Penny_Dreadful

Can you please share a copy of the guarantee online as posters here can probably work out which parts would be deemed unfair.  From the scant information provided I can almost certainly guarantee SS is not liable for the utilities. Surely the tenant has their own accounts with the utility providers that the landlord is not party to at all.

Whilst we are at it, what exactly does the letter before action say?  The tenant and SS conspiring together isn't, on its own, a reason to take SS to court so what does the landlord want?

I said pages ago that SS could save himself a lot of money in solicitors fees by simply writing to the landlord saying that the guarantee is invalid, a sentiment the solicitor does seem to accept as a possibility.

Rather than fight the landlord or pay a solicitor, SS could just say to the landlord that he will settle up once the tenant has been evicted and he can be presented with a final bill.  Even if it takes 12 month to evict, £100 x 12 is a lot less than the solicitor is charging.

Flopfluppet

Hello PD, I will see if I can get a copy a post it for you to see, thank you.  I know you said there was no need for him to spend on a solicitor but it's what he wanted to do. At the moment there is already an arrears of £3k so there has been a shortfall in the rent for some time now plus tenant was in a psychiatric hospital for a spell and no rent was paid. The guarantee apparently says guarantor is liable for all costs arising from non payment of rent by tenant and solicitor says that will include refurbishment,  utilities unpaid etc. So there is going to be a huge amount of money owing in the end. 
The LL (I will also post excerpts of his letter) seems to gave no intention of evicting the tenant rather just collect arrears and shortfall in rent indefinitely by going to court if he has to. I really can't understand why the LL won't just start eviction proceedings other than telling SS they didn't want to because tenant would be housed by the council and that would be unfair, in his eyes.
I'll put up what I can later.

user1977

Flopfluppet said:

The guarantee apparently says guarantor is liable for all costs arising from non payment of rent by tenant and solicitor says that will include refurbishment,  utilities unpaid etc.

Why would the landlord be liable for the tenants' utilities bills? That's not how it works.

Similarly "refurbishment" isn't going to be any more than the tenant would be liable for (i.e. doesn't include any betterment).

And that assumes the guarantee is valid at all, which we don't seem to have determined yet (and we're on page 6...)

ThisIsWeird

Hellish, FlopF.
Why doesn't the LL proceed with an eviction order? Presumably because they consider that would be more effort. And they'd need to get their flat ready for a new tenant - what a palavar. Whilst this tenant remains, the LL knows that their flat is in a state, but that they are not liable for this, so happy to let it continue - the rent will be coming in as required. His given reason could also be true - why should he evict, and then contribute via his hard-earned taxes towards housing a layabout... Instead, he's happy to bleed a well-intentioned fellow.
Ie, he's an unethical 'ole.
It's a shame your SS didn't try the suggested letter (modified, if needed) first, as that would have been a zero-cost step that might, just possibly, have made this calculating LL realise he might have solicitor's costs coming his way to defend it. I suspect he's that cynical.
Anyhoo, that chance has gone, so I really hope you have luck with your action.
I suspect at some point this horrible human will make a simple judgement on which outcome will cost him less, and only that will make him act. He's enough to give LLs a bad name...

Flopfluppet

User1977: according to the solicitor,  the guarantee isn't valid due to incorrectly executed but the LL could argue successfully that it is therefore a simple contract and the terms of it upheld. So not valid in one way but it us in another. 
With regard to refurbishment,  LL is saying (so far verbally during call with SS) that he is going to make sure the whole flat is upgraded and refurbished so he can then sell it if SS doesnt pay up prior to court. The solicitor said in their letter SS is liable for costs ( but presumably only reasonable ones) and unpaid utilities, the deed says that apparently. 
TIW: the landlord has said why should he bother evicting tenant when most of the rent is paid via tenant benefits and SS can pay shortfall indefinitely.  Tenant spends lots of time on social media posting what he spends his money on and boasting about living on someone else's money. 
So below are a few key points from 'Pre-action protocol' letter: 
Heading of 'emotional manipulation and religious beliefs ' 
LL concerned that they are being emotionally manipulated by SS by him saying he is a Christian (that arose because early on LL asked SS to resort to violence to get tenant out for him and SS explained why he wouldn't do that) After phone calls to SS, LL questions SS honesty and agenda which LL thinks is guided towards self protection rather than honouring terms of guarantee.
Losses incurred:
£3k rent arrears, increased mortgage and insurance costs while planned sale of property delayed, subsequent increased debt costs affecting credit score, property damages necessitating replacement/repairs, additional security measure due to tenants illegal activities,  gas safety certificate renewal costs, loss of eventual sale value and increased capital gains tax, increased living/rental costs due to being unable to return to home. 
Then LL requests SS address above issues and removes tenant from the flat!!!! Letter ends saying if not dealt with in 14 days, legal action will result and financial compensation and a possession order against assets and future assets obtained. 
Quite stunned by what LL is trying to claim for plus still not evicting tenant but expecting SS to do it instead. The legal action will still only be against SS and no eviction started.
LL also complains that SS will not meet face to face. LL is in London SS on South Coast so not any easy meet up. SS also is wary because there is no benefit to meeting and anything can be sorted via email.
So I need to know please, how to respond to LL letter. Thank you.