Letting Agent not returning Tenants' Deposit

E201

Dear Forum,

I hope you can assist me with this issue. I have tried to provide as much relevant information as I can to give the fullest context possible:

- I have 2 tenants who have been living in my flat since 2017 with their child. From 2017 to 2020 the 3 -year assured short hold tenancy was administered by a local estate agent X. Local agent X found the tenants and they oversaw the protection of their deposit from 2017 to 2020 -  it was held in the Deposit Protection Scheme.

- In April 2020, when the tenants fulfilled their 3-year AST with agent X, I moved the tenants onto a 3-year tenancy agreement between ourselves.  Covid was raging at this time and the tenants wanted to have an AST with me as I could offer a slightly lower rent than the market. In April 2020 (2 weeks after the AST finished with local agent X) I requested by email that the tenants deposit be returned. I received a response from agent X saying they would oblige. 

- The tenants and I have since signed a further agreement (in 2023) for another 36 months until 2026. For the duration of their time in the flat I have not received any deposit monies from the  tenants.

- I have now discovered, almost 5 years later, that the deposit was not returned to the tenants in April 2020 by agent X as I had assumed. I have been emailing agent X over the last month, but they have not been responding. 

Please could you provide an indication of what my legal position is and what can I do to resolve this situation.

FlorayG

The deposit is still protected; I have a similar situation, I bought a tenanted property which had previously been managed by an agent, I manage it myself, the agent still has the protected deposit.

Why do you want the deposit returned if you don't require the tenants to give you a deposit? ( presumably you don't as you've left it this long)

E201

Hi FloreyG, thanks for the reply. I have checked with the DPS and the deposit is no longer protected (not since April 10 2020). I didn't provide all the context in my original message but I am about to start a section 21 and in case it does go to court I wanted to ensure the deposit is with the tenants. 

FlorayG

E201 said:

Hi FloreyG, thanks for the reply. I have checked with the DPS and the deposit is no longer protected (not since April 10 2020). I didn't provide all the context in my original message but I am about to start a section 21 and in case it does go to court I wanted to ensure the deposit is with the tenants. 

Well that is just weird. The deposit belongs to the tenant and would not have been refunded to anyone else. Are you able to check with the DPA and find out to whom they refunded the money?
Agent X does not refund the money. Agent X agrees with the DPA that the money can be refunded and the DPA refunds it directly to the tenant. Agent X should never see the money that is being refunded

saajan_12

E201 said:

Dear Forum,

I hope you can assist me with this issue. I have tried to provide as much relevant information as I can to give the fullest context possible:

- I have 2 tenants who have been living in my flat since 2017 with their child. From 2017 to 2020 the 3 -year assured short hold tenancy was administered by a local estate agent X. Local agent X found the tenants and they oversaw the protection of their deposit from 2017 to 2020 -  it was held in the Deposit Protection Scheme.

- In April 2020, when the tenants fulfilled their 3-year AST with agent X, I moved the tenants onto a 3-year tenancy agreement between ourselves.  Covid was raging at this time and the tenants wanted to have an AST with me as I could offer a slightly lower rent than the market. In April 2020 (2 weeks after the AST finished with local agent X) I requested by email that the tenants deposit be returned. I received a response from agent X saying they would oblige. 

- The tenants and I have since signed a further agreement (in 2023) for another 36 months until 2026. For the duration of their time in the flat I have not received any deposit monies from the  tenants.

- I have now discovered, almost 5 years later, that the deposit was not returned to the tenants in April 2020 by agent X as I had assumed. I have been emailing agent X over the last month, but they have not been responding. 

Please could you provide an indication of what my legal position is and what can I do to resolve this situation.

When you say 'administered by local agent X' do you mean with you as the LL and them as the agent? Or was it some rent guarantee scheme or direct rental by the agents? 

Assuming you were the LL, then as between you and the tenants, you did receive the deposit, just held by your agent. If it hasn't been protected all this time, then you would need to return that amount of money to the tenant before issuing a S21. The tenant could also sue you for non protection. The 

You may separately have a claim against the agent for the deposit amount at least. 

FlorayG said:

E201 said:

Hi FloreyG, thanks for the reply. I have checked with the DPS and the deposit is no longer protected (not since April 10 2020). I didn't provide all the context in my original message but I am about to start a section 21 and in case it does go to court I wanted to ensure the deposit is with the tenants. 

Well that is just weird. The deposit belongs to the tenant and would not have been refunded to anyone else. Are you able to check with the DPA and find out to whom they refunded the money?
Agent X does not refund the money. Agent X agrees with the DPA that the money can be refunded and the DPA refunds it directly to the tenant. Agent X should never see the money that is being refunded

Incorrect. Agent X could well have used an insured scheme, or even with a custodial, if the tenant never requested it  thinking the tenancy wasn't over and agent did, it may not have gone back to the tenant. 

FlorayG

saajan_12 said:

E201 said:

Dear Forum,

I hope you can assist me with this issue. I have tried to provide as much relevant information as I can to give the fullest context possible:

- I have 2 tenants who have been living in my flat since 2017 with their child. From 2017 to 2020 the 3 -year assured short hold tenancy was administered by a local estate agent X. Local agent X found the tenants and they oversaw the protection of their deposit from 2017 to 2020 -  it was held in the Deposit Protection Scheme.

- In April 2020, when the tenants fulfilled their 3-year AST with agent X, I moved the tenants onto a 3-year tenancy agreement between ourselves.  Covid was raging at this time and the tenants wanted to have an AST with me as I could offer a slightly lower rent than the market. In April 2020 (2 weeks after the AST finished with local agent X) I requested by email that the tenants deposit be returned. I received a response from agent X saying they would oblige. 

- The tenants and I have since signed a further agreement (in 2023) for another 36 months until 2026. For the duration of their time in the flat I have not received any deposit monies from the  tenants.

- I have now discovered, almost 5 years later, that the deposit was not returned to the tenants in April 2020 by agent X as I had assumed. I have been emailing agent X over the last month, but they have not been responding. 

Please could you provide an indication of what my legal position is and what can I do to resolve this situation.

FlorayG said:

E201 said:

Hi FloreyG, thanks for the reply. I have checked with the DPS and the deposit is no longer protected (not since April 10 2020). I didn't provide all the context in my original message but I am about to start a section 21 and in case it does go to court I wanted to ensure the deposit is with the tenants. 

Well that is just weird. The deposit belongs to the tenant and would not have been refunded to anyone else. Are you able to check with the DPA and find out to whom they refunded the money?
Agent X does not refund the money. Agent X agrees with the DPA that the money can be refunded and the DPA refunds it directly to the tenant. Agent X should never see the money that is being refunded

Incorrect. Agent X could well have used an insured scheme, or even with a custodial, if the tenant never requested it  thinking the tenancy wasn't over and agent did, it may not have gone back to the tenant. 

OP says the deposit was protected in a DPA until 2020 at which time it seems to have disappeared

Mr.Generous

FlorayG said:

saajan_12 said:

E201 said:

Dear Forum,

I hope you can assist me with this issue. I have tried to provide as much relevant information as I can to give the fullest context possible:

- I have 2 tenants who have been living in my flat since 2017 with their child. From 2017 to 2020 the 3 -year assured short hold tenancy was administered by a local estate agent X. Local agent X found the tenants and they oversaw the protection of their deposit from 2017 to 2020 -  it was held in the Deposit Protection Scheme.

- In April 2020, when the tenants fulfilled their 3-year AST with agent X, I moved the tenants onto a 3-year tenancy agreement between ourselves.  Covid was raging at this time and the tenants wanted to have an AST with me as I could offer a slightly lower rent than the market. In April 2020 (2 weeks after the AST finished with local agent X) I requested by email that the tenants deposit be returned. I received a response from agent X saying they would oblige. 

- The tenants and I have since signed a further agreement (in 2023) for another 36 months until 2026. For the duration of their time in the flat I have not received any deposit monies from the  tenants.

- I have now discovered, almost 5 years later, that the deposit was not returned to the tenants in April 2020 by agent X as I had assumed. I have been emailing agent X over the last month, but they have not been responding. 

Please could you provide an indication of what my legal position is and what can I do to resolve this situation.

FlorayG said:

E201 said:

Hi FloreyG, thanks for the reply. I have checked with the DPS and the deposit is no longer protected (not since April 10 2020). I didn't provide all the context in my original message but I am about to start a section 21 and in case it does go to court I wanted to ensure the deposit is with the tenants. 

Well that is just weird. The deposit belongs to the tenant and would not have been refunded to anyone else. Are you able to check with the DPA and find out to whom they refunded the money?
Agent X does not refund the money. Agent X agrees with the DPA that the money can be refunded and the DPA refunds it directly to the tenant. Agent X should never see the money that is being refunded

Incorrect. Agent X could well have used an insured scheme, or even with a custodial, if the tenant never requested it  thinking the tenancy wasn't over and agent did, it may not have gone back to the tenant. 

OP says the deposit was protected in a DPA until 2020 at which time it seems to have disappeared

They said DPS - a scheme, I think we need to know exactly what scheme to advise. If the scheme dealt with the tenant / agent, then they probably won't talk to the landlord some years later.

Rather than email the agent how about turning up at the branch? An agent lodged my tenants deposit with their own scheme rather than the TDS I use once, after being told via email several times how nothing could be done I turned up at the branch in person and made a face to face complaint. The senior partner wasn't in, but agreed to pay me out of agency funds, apparently AML rules mean the deposit cannot be withdrawn from a scheme in the first 30 days!!

AskAsk

if the deposit had been returned in 2020 as you state from the information you got from the DPS, then the responsibility lies with the EA.  i assume your new contract states zero for deposit held?

it is very unusual for a landlord not to take a deposit.  if you asked the EA to return the tenants' deposit in 2020, then why didn't you ask the tenants for a new deposit?

have you called them as they are not responding to emails?  and have you visited their office?

E201

saajan_12 said:

E201 said:

Dear Forum,

I hope you can assist me with this issue. I have tried to provide as much relevant information as I can to give the fullest context possible:

- I have 2 tenants who have been living in my flat since 2017 with their child. From 2017 to 2020 the 3 -year assured short hold tenancy was administered by a local estate agent X. Local agent X found the tenants and they oversaw the protection of their deposit from 2017 to 2020 -  it was held in the Deposit Protection Scheme.

- In April 2020, when the tenants fulfilled their 3-year AST with agent X, I moved the tenants onto a 3-year tenancy agreement between ourselves.  Covid was raging at this time and the tenants wanted to have an AST with me as I could offer a slightly lower rent than the market. In April 2020 (2 weeks after the AST finished with local agent X) I requested by email that the tenants deposit be returned. I received a response from agent X saying they would oblige. 

- The tenants and I have since signed a further agreement (in 2023) for another 36 months until 2026. For the duration of their time in the flat I have not received any deposit monies from the  tenants.

- I have now discovered, almost 5 years later, that the deposit was not returned to the tenants in April 2020 by agent X as I had assumed. I have been emailing agent X over the last month, but they have not been responding. 

Please could you provide an indication of what my legal position is and what can I do to resolve this situation.

When you say 'administered by local agent X' do you mean with you as the LL and them as the agent? Or was it some rent guarantee scheme or direct rental by the agents? 

Assuming you were the LL, then as between you and the tenants, you did receive the deposit, just held by your agent. If it hasn't been protected all this time, then you would need to return that amount of money to the tenant before issuing a S21. The tenant could also sue you for non protection. The 

You may separately have a claim against the agent for the deposit amount at least. 

FlorayG said:

E201 said:

Hi FloreyG, thanks for the reply. I have checked with the DPS and the deposit is no longer protected (not since April 10 2020). I didn't provide all the context in my original message but I am about to start a section 21 and in case it does go to court I wanted to ensure the deposit is with the tenants. 

Well that is just weird. The deposit belongs to the tenant and would not have been refunded to anyone else. Are you able to check with the DPA and find out to whom they refunded the money?
Agent X does not refund the money. Agent X agrees with the DPA that the money can be refunded and the DPA refunds it directly to the tenant. Agent X should never see the money that is being refunded

Incorrect. Agent X could well have used an insured scheme, or even with a custodial, if the tenant never requested it  thinking the tenancy wasn't over and agent did, it may not have gone back to the tenant. 

Yes the agent did use the insured scheme. Does this change the situation? I really am getting confused with this.

E201

AskAsk said:

if the deposit had been returned in 2020 as you state from the information you got from the DPS, then the responsibility lies with the EA.  i assume your new contract states zero for deposit held?

it is very unusual for a landlord not to take a deposit.  if you asked the EA to return the tenants' deposit in 2020, then why didn't you ask the tenants for a new deposit?

have you called them as they are not responding to emails?  and have you visited their office?

Hi AskAsk, thanks for the reply and the questions you've asked. I couldn't put all the details in my original post as it would be too long. Here are my answers below:

- The DPS haven't said that it was returned. They simply told me that it stopped being protected on 10 April 2020 which is when the AST contract concluded with agency X.

- I assumed that the deposit had been returned to the tenants when we drew up our new contract. I did put the same amount of deposit on the contract as I intended to ask for it but I didn't because of Covid. I ended up putting their rent down as they were in economic hardship at the time.

- I've been emailing agency X for the past few weeks about this but have not got a reply. I have been advised to make a complaint through their internal complaints process. 

AskAsk

E201 said:

AskAsk said:

if the deposit had been returned in 2020 as you state from the information you got from the DPS, then the responsibility lies with the EA.  i assume your new contract states zero for deposit held?

it is very unusual for a landlord not to take a deposit.  if you asked the EA to return the tenants' deposit in 2020, then why didn't you ask the tenants for a new deposit?

have you called them as they are not responding to emails?  and have you visited their office?

Hi AskAsk, thanks for the reply and the questions you've asked. I couldn't put all the details in my original post as it would be too long. Here are my answers below:

- The DPS haven't said that it was returned. They simply told me that it stopped being protected on 10 April 2020 which is when the AST contract concluded with agency X.

- I assumed that the deposit had been returned to the tenants when we drew up our new contract. I did put the same amount of deposit on the contract as I intended to ask for it but I didn't because of Covid. I ended up putting their rent down as they were in economic hardship at the time.

- I've been emailing agency X for the past few weeks about this but have not got a reply. I have been advised to make a complaint through their internal complaints process. 

you can't unprotect a deposit without returning it as the form will ask you if you have returned the full deposit or have kept some and they will inform the tenants that their deposit has been unprotected.

sounds like the tenants had the money back but have lied about it as the deposit could not be unprotected without them being notified to give them a chance to raise a dispute.

does sound a bit of a mess but make a complaint with the EA as they had advised, but i do think your tenants know more than they are letting on.