Sub tenant deposit rights?

[nikkikitch]

Hi

 

So Im a tenant in a house and recently subletted one of the rooms. I didnt get permission only because my landlady is never around and barely gets back to us as she works away a lot. Shes usually very easygoing so i didnt see it being an issue to be honest.

 

Anyway someone moved in and we agreed 3 months initially with a 2 month notice period. We agreed that they would pay a deposit which would be refundable if they chose to leave at the end of the 3 months and there were no damages or rent arrears. We both signed this agreement.

 

The person told me 4 days ago that they wish to leave and they moved out today! Giving me no notice at all. They did not pay any further rent.

 

I have told them that they will not be receiving their deposit back as they did not give a notice period and obviously as a joint tenant it leaves me in a very difficult position as rent is due in a few days and it will be very hard to find someone to move in so quickly.

 

I have received an email from the subtenant demanding their deposit back and quoting law that says i shouldve put the deposit in a scheme. I appreciate thats what landlords do, but I am not the landlord.

 

Do they have any rights and what are my rights please? Equally i could say we had a signed agreement for 3 months but i have not asked them to pay the full 3 months!

[renegadeimp]

So you broke the law? You are NOT the landlord and had NO rights to sublet. Therefore the other party is fully entitled to their money. They could take legal action against you and theres a high chance they would win. I would pay them back before you get in more trouble.

[nikkikitch]

I don't need lynching thanks, i need some advice!

[renegadeimp]

I gave youa dvice. Give the money back, before this other party causes you more trouble. If they take you to court, they will likely win, and you will probably lose your tenancy once the landlord finds out, unless they are very VERY considerate, and say you were allowed. Then comes the issue of valid tenancy agreements. If you used one of these, then you considered yourself a landlord and should have put the money into the relevant scheme. Otherwise it could be seen as fraud.

[nikkikitch]

I don't think you'd finished your message when it came through , it only said, 'so you broke the law'. The rest just came in now.

[nikkikitch]

Subletting isnt actually illegal is it? Just googling now....

[renegadeimp]

The forum has been playing up lately. Even admins have had posts go missing. I'm sorry if i sounded harsh too, but thats what will pretty much happen. If you had written permission from the landlord and had a valid tenancy agreement, then you would have to put the deposit into the relevant scheme.

[nikkikitch]

No its fine, id rather have direct answers!

[nikkikitch]

Sublettings isnt actually illegal so I havent broken the law. I may have broken my tenancy agreement if there is a clause to say i cant sub let but thats it!

[renegadeimp]

What i meant is that you knew you werent allowed to sublet, you still did, you took the "deposit", didnt secure it, and you knew this as you said in your OP. Now the other party is asking for his money back 9 and he's fully entitled to it. It is up to you what you do, but if he were to issue a court claim, his chances of winning are very high, and would probably end up with your landlord being notified.

[nikkikitch]

How can their chances of winning be high when they signed an agreement? They were happy to move in and out informally, ie without a proper tenancy agreement and deposit scheme and with a weeks notice, so to start quoting the law now after breaking their end of the agreement is not fair really is it!?

[renegadeimp]

They can sign any agreement, the problem you have is the agreement has no standing in law. They were also under the impression that you were a legitimate landlord, so they had no reason to question anything.

[nikkikitch]

No she knew i wasnt the landlord! , she knew the circumstances and that she would be subletting.

[renegadeimp]

Gotcha. Sadly, that still doesnt make it a legally binding document. It's up to you whether you give the money back, but as i said, you need to tread VERY carefully as if they issued a court claim, theres a high chance of them winning.

[Lea_HTH]

When you say you 'sublet' do you actually mean you took a lodger? If you took a lodger then you are not obliged to protect the deposit. If you actually sublet the property (i.e. you rented out the entire property and moved out yourself giving the subletter sole occupancy), then you would be obliged to protect the deposit.

 

From my reading of your posts it seems you took a lodger - and wrote up an agreement between you and them, which they clearly agreed to. Whether your LL agreed to it or not is immaterial until the point at which they make a fuss about it. No fuss means no problem.

 

A court is not likely to find in favour of your lodger in relation to non-protection of the deposit as it is not a legal requirement - but they may expect some of the deposit to be returned, once reasonable deductions are made for non-payment of a reasonable notice period. Reasonable notice would normally be the rental period - so if they paid you monthly, one month's notice, and if weekly, then one week.

[renegadeimp]

Would the fact that he wasnt authorised to take in lodgers come into play, and therefore making the deposit invalid and refundable? I think thats where the crux of the matter is really.

[Lea_HTH]

That's not the crux at all. It all depends on whether OP's tenancy agreement prohibits or allows sub-letting with or without LL's permission - and even if it prohibits it, without LL making a fuss (as per my comment earlier), then there's not going to be an issue. Even if LL makes a fuss - the breach is between the LL and OP, not the LL and OP's lodger. OP doesn't have to feel held over a barrel by the ex lodger - he/she can deduct reasonable notice from deposit and return remainder (if there is any).

[stu007]

From the OPs first post they did not get the landlords permission so it sounds like they knew they needed the landlords permission.

 

You are correct we need the OP to clarify if there Tenancy Agreement with the Landlord prohibits or allows sub letting with or without the LL permission?

 

We also need the OP to clarify exactly what type of Tenancy Agreement they signed with the sub letter?

 

Also the person sub letting how were they paying council tax could you clarify?

[nikkikitch]

Hi

 

To be honest I have no idea if my tenancy agreement allows it or not, i will dig it out.

 

We didnt sign a detailed tenancy agreement. I asked her what she would be happy with in terms of a signed document and she said on email was fine. In the email I wrote the contract length, the rent payable, the notice period and what would happen to the deposit. We printed the email out and both signed it, so like i say very informal.

 

I also live at the property so I would say technically she would be classed as a lodger?

 

If she had requested a more formal tenancy agreement, I would of course have provided it or asked for landlord permission but there seemed to be no need.

 

I think its reasonable as you say, to deduct a months notice and give her the remainder.

 

In her email, she has quoted law provided by a 'lawyer friend' which says if the deposit isn't placed in a deposit scheme, she can claim 3 x the deposit in compensation. It says she can claim against the actual landlord who would then have to claim against me. Is that correct!? :/

[Lea_HTH]

Your lodger has no claim against your LL - your LL wasn't even aware they were there, so they are barking up the wrong tree with that one.

 

Her 'lawyer friend' is also not correct - IF you had to protect the deposit (and you don't as you live in the property too), then she would have a claim of the return of the deposit plus a request to the court of 1 to 3 times the amount of the deposit in a penalty payment. But, she's got no chance of that, 1) because she was a lodger and 2) because she probably doesn't have the £1k of fees in order to make the claim in the first place (it's not a small claims court issue).

 

Write back to her, tell her you plan to deduct X from the deposit in unpaid rent and will return the rest to her forthwith. Then deduct the amount and return the rest. If she wants to dispute anything she'll have to go to court. In the interim have a quiet word with your LL and ask him/her if they would object to you taking a lodger in.

[nikkikitch]

Thanks that's great.

 

Just to be clear, this isn't about me being dodgy and trying to keep her money. I'm not that way inclined at all and always try and be fair, but she really has left me in the lurch as I will have to pay double rent this month!

[steampowered]

I do not fully understand why the terms of the Op's tenancy agreement are relevant here. It seems clear that the sub-let was a breach of the Op's contract with landlord. But this does not form part of the contract between Op and the sub-tenant. It is true that Op misrepresented to the sub-tenant that the Op was entitled to enter into the sub-tenancy agreement. This could give rise to a claim for damages if the ultimate landlord evicted the sub-tenant ... but that didn't happen.

 

As advised above, there is no duty to protect the deposit if the sub-tenant was merely a lodger. As I understand it the distinction is not always obvious but two key distinctions are whether the person has exclusive rights to the property and whether the person shares space with the landlord.

 

In this case it sounds like Op not have the right to enter the property during the sub-tenancy, did not share the property with that person and there was a formal agreement lasting for a significant period of time. These factors all point towards a tenant not a lodger.

 

It sounds to me like you are dealing with an assured shorthold tenancy, in which case you were obliged to protect the deposit. The deposit was paid to you and the agreement was with you. The fact that this was a sub-let does excuse you from that. My understanding is that, if the tenant brings legal action, the court may order you to refund 3x the deposit as a penalty for not protecting it. I am not saying don't pursue the unpaid rent, certainly email back saying you will counterclaim for all unpaid rent if the sub-tenant brings court proceedings, just bear this in mind.

Edited June 25, 2013 by steampowered

[Lea_HTH]

I do not fully understand why the terms of the Op's tenancy agreement are relevant here. It seems clear that the sub-let was a breach of the Op's contract with landlord

 

Your sentences above contradict each other. OP's tenancy agreement is relevant precisely because it is necessary to find out whether he/she was allowed to take a lodger/sub-let. So knowing what is in OP's tenancy agreement is fundamental.

 

That aside, to be a tenant, one has to have exclusive use of a property, this lodger did not, ergo there was no AST, it was, at best, a licence.

 

In this case it sounds like Op not have the right to enter the property during the sub-tenancy, did not share the property with that person and there was a formal agreement lasting for a significant period of time. These factors all point towards a tenant not a lodger.

 

The above also makes no sense as a) OP did not state she moved out and b) she in fact states quite clearly in post #19 that she lives in the property - therefore at no time did the LODGER have sole occupancy rendering her a 'tenant'.

 

You appear to have been misled by the OP's use of the words 'sub-let' - it's not a sub-let at all.

 

 

The court information has been dealt with - there is no claim based on the facts given in this thread.

[steampowered]

 

Your sentences above contradict each other. OP's tenancy agreement is relevant precisely because it is necessary to find out whether he/she was allowed to take a lodger/sub-let. So knowing what is in OP's tenancy agreement is fundamental.

The original tenancy agreement was between Op and landlord, so I would have thought that breach of this agreement is a matter between op and landlord. I don't quite follow what relevance that would have for relations between Op and the sub-tenant here?

That aside, to be a tenant, one has to have exclusive use of a property, this lodger did not, ergo there was no AST, it was, at best, a licence.

 

Apologies for missing the bit about the Op sharing the property first time around. You are probably entirely correct ... I just query whether we have enough information to say this is definitely a lodger. You can have exclusive occupation and a lease over a room, no need to have exclusive occupation over the whole property.

Edited June 26, 2013 by steampowered