Tenants refusing to pay this months rent: HELP!

[desperatehousewife]

our tenants flooded our flat and 4 adjoining flats (it was an accident) and we have decided to sell the flat. We have served notice on tenants (due out end of June). They have stopped their standing order for rent, so we shan't get their last months rent. They are obviously worried we will withold their deposit (due to damage done to our flat and other flats). Damn right we will!

Anyone had any success in small claims court? Is it worth pursuing or a total waste of time?

Thanks for any advice
Livid, DHW.

Have no legal experience at all but as a landlord I'd chalk it down to bitter experience.
it'll cost you money and anxiety. you've got their deposit. legally you're right- they shouldn't have cancelled and as such are in breach of contract. You would win if you pursued them but I'm not sure I would as it'd be too much hassle

I would write to them first, telling them that if you don't receive the rent then you will take the matter further as they are in breach of contract.

Many of the students where I work have lost thousands on deposits retained by landlords. As a result it's standard practice for a lot of them to not pay the last month's rent, as they feel the landlord will hold their deposit, anyway. I know that's wrong and have never done anything like that myself, but it is more common than you think.

thanks for thoughts - the ridiculous thing is that it is not a bunch of students - but young professionals - who are paying £1550 a month for the flat (I know that sounds a ridiculous amount - but it is very central london and it is big). This is a lot of rent for me to be losing. They also have all of our furniture (they chose to put it in storage so they could put their own in the flat) I'm feeling really worried that we are being shafted big time.

thanks gf - will do

I'm so peed off that tenants are so well protected by the law but we as landlords are so vulnerable. We cannot demand that they leave our property that they are refusing to pay rent on. I think it's outrageous. Humph.

Maybe the bigger worry should be that they may not leave......
ok...don't mean to scare you here....but we just went through having to get our late paying tenants out, and we ended up giving back half the deposit just to get them out. Had to argue and fight over the last half and came to an agreement but thankfully they never did contact us for it...they knew they owed it to us.
Maybe you would be better off phoning them and trying to negotiate with them because although you might need the rent money and deposit badly...you need them NOT to refuse to move out even more....try and keep that in your head!! I know it sounds silly but that will cost you A LOT more in terms of lost rental income and legal fees which again you would have to fight to get back.
GOOD LUCK!!!

good thinking marz - good point. Although I do think that they are looking for somewhere else to live anyway - they told us they wanted to go which is why we gave them notice. Oh god, that would be a nightmare if they refused to leave...yikes.

But dh why should you withhold their deposit? The flood damage should surely be covered by your buildings insurance?

I have to say, I have been on the tenants' end of this. One landlady refused to give us our deposit back because she said we had nicked her lampshades (we hadn't and they weren't on the list of stuff she left anyway) - ie she kept the ENTIRE deposit (about £500) for the sake of TWO lampshades - another landlady kept back £100 of our deposit because we had put coat hooks up in the hall (they were selling the house anyway and the buyer liked them!). Yet another landlady withheld our deposit, I can't remember the reason.

So despite having returned the property in the condition in which it was let, out of six properties we have rented we have had our deposit retained on three occasions.

I do totally understand your frustration dh, but also agree that if the flooding was an accident and is covered by your buildings insurance (as it should be), then it is unfair to claim this back off your tenants. Plus as you can see from my experience it is often the tenants who fare worse under this system (NOT that I condone their actions, btw!)

it's not covered by buildings - as the owners of all the flats in the development (53 flats) have all agreed that any claim under 10K should not be covered as it's not worth it. (?!)

Our home insurance covers us, but not the damage done to other flats (£3K)

DH I don't know legal laws but I would write to them especially regarding furniture. If they weren,t to return it it would be theft and as professionals I don't think they would want to be known as thieves as I'm sure you would beable to press charges.

desperatehousewife, my dh is a property litigation lawyer. He has said that the only way to get the rent (which he thinks you are entitled to) or to evict the tenants, is to go to court. He thinks you would be successful, but at the end of the day all you will have is a court order, which you would then have to enforce against the tenants -make them bankrupt/get an attachment of earnings order etc. You would probably have to go to court again to enforce the court order.

Do you think it would scare them into paying if you initiated proceedings? It is probably worth writing them a letter threatening proceedings and seeing whether this has any effect, before deciding whether to issue proceedings. let me know if you need any further info.

another point, if you make a claim against your insurance policy, your insurers may choose to sue the tenants for the damage. (alternatively, if the insurers pay up for all the damage, you may not be entitled to keep the deposit...)

pollyanna, thanks very much for the help. will let you know!

But that is your decision (OK so yours and 53 others decision) to not insure for under £10k - not the tenants. Unless you passed on that excess to them in your tenancy agreement they should not be liable for accidental damage which most people would assume was covered by buildings insurance - I know that if I had been told by my landlord that I was liable for the first 10k of any insurance claim I would have either not moved in here or taken out my own inusrance to cover me.

I do agree they should not have withheld the rent, but if you had told me as your tenant that you were holding me liable for the damage to other flats I would have done the same. I do think you would find it difficult to legally (let alone morally) hold them liable.

sorry, the 10K thing covers buildings - and the water hasn't damaged the building, but the contents of 4 other flats (carpets, wooden floors, lights etc)

dh I'm not trying to pick a fight with you honest . But buildings insurance, in a block of flats, should cover damage to contents of other flats in the block due to flooding etc. I had to arrange insurance for my old bock of 120 flats (stupidly went onto the managing comittee) and that is a fairly standard inclusion. We paid for a 0 excess on the policy to cover exactly the situations you describe to prevent issues between residents. And carpets/wooden floors are definately fittings and fixyures which would normally becovered by buildings rather than contents. As a tenat of a flat I would definately assume that the landlords building insurance would cover me in such a situation.
You have been saving money (via lower service charges) by taking the risk of being uninsured for the first 10K, so unless you explicitly passed on this risk, and the savings, to your tenant, I think you have to swallow this. Maybe you could offset it all against your profits though and at least save the tax.

I know your'e not prufrock!

dh do you mean you will withhold the deposit because they haven't paid rent or because of the damage.

i was in a rant yesterday. Tenants have now paid their last months rent (it was a misunderstanding with their bank) ooops. Feel really bad now. They have been really good tenants - always paid on time. Just really peed off that because of their accidental damage, we are in a tricky situation with 4 other flats in the development.

Am wondering if I can withold their deposit until it's clear who is liable to pay for the damage.

dh - I do think that as water damage to carpets etc from somebody elses flat would normally be covered by Buildings insurance, and that as you, and these other flat owners have all jointly chosen not to have that cover for the first 10k, then the other flat owners should take some responsibility for the costs of correcting the damage to their flats. I would definately bring it up with the managing agents/residents comittee and ask them what they envisaged happening in the inevitable disutes taht would arise because of their decision to have this excess. And I would also get them to reconsider - if they shop around they should be able to get a realy good deal on buildings insurance - when we too over teh managemnet company from the buildes we managed to save ourselves over £40k on the insurance cover.

thanks pru