A letting agent in East Yorkshire says a recent adjudication by The Property Ombudsman could lead to more landlords making compensation claims against letting agents over loss caused by the landlord’s own actions.
Phil Jones, MD of Goole firm Link Agency who is also president of the local Chamber of Commerce, says he’s been told by TPO to pay £400 to his former landlord client after handing back their 14-property portfolio three years ago, with all rent accounts up to date.
“But seemingly only if the complainant agrees to the award,” says Jones.
His agency managed the properties on behalf of Fiona and Andrew Good between 2015 and 2018.
In February 2016 Link Agency onboarded a tenant at one of the properties within the portfolio, a house in Brompton Park (pictured) in Kingswood, Hull.
She passed referencing and, although, from time to time, she proved to be a difficult customer her rent was up to date at the time Link handed the portfolio to the Landlord to manage, two years later, in 2018.
After this, the tenant then began to fall into arrears.
Following a complaint by the landlords, TPO initially said that because the Goods were made aware of the challenges that the tenant presented 12 months before making a formal complaint, the dispute fell outside its terms of reference.
TPO says the Goods rejected this and asked for a full investigation, also telling Jones that they were pursuing damages of more than £9,000 in lost rental income due to rental arrears.
Following TPO’s most recent adjudication, Link Agency has been ordered to pay the Goods £400 in ‘full and final settlement’.
The reason given is that the tenant’s new job had not begun at the time of referencing and that this was not made clear by the agency at the time.
But TPO agreed with Link Agency, saying a company cannot be held responsible for rent arrears built up after it handed back a portfolio. Jones says the Goods were made aware of how the referencing was carried out, including that she was about to start a new, well-paid job.
But Jones (pictured) says that, although he recognises £400 is a relatively small amount of money, he’s aggrieved that by paying the fine he will set a precedent that agents can be held responsible for loss occurring after an agency has returned a portfolio to a landlord to manage.
“The complainant did not lose one penny while we managed the tenancy”, he said.
The Neg approached TPO for comment. It says that, because the case has not been closed yet, it cannot comment on live cases.