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It’s nice to share

But it also can make for complications when a student sharer asks for the return of a deposit, as The Property Ombudsman, Rebecca Marsh explains.

Rebecca Marsh

Link to The Property Ombudsman

Complaint

The Property Ombudsman (TPO) was asked to review a case which arose from a student tenant concerned about a deposit return. The tenant said that she vacated the property on the tenancy end date after giving three weeks verbal notice, but the agent did not make the arrangement to return her part of the deposit promptly.

The agent responded saying that a new sharer had been found to replace the tenant and it was the new sharer who needed to pay the tenant her share of the deposit. Unfortunately, due to Covid-19, the new sharer was unable to move in as expected and therefore did not sign the documentation to take over the tenant’s liabilities. This meant that the tenant’s proportion of the deposit could not be returned.

When there is more than one tenant, there is joint responsibility.

Link to The Property OmbudsmanThe 2019 edition of the TPO Code of Practice was considered. For this case, the particular focus was on paragraph 16c which concentrates on giving or receiving notice to bring a tenancy to an end. Agents must provide a tenant with general written guidance as to what steps need to be taken relating to the preparation of the property for the final check-out, handover of keys and other matters. Agents must actively flag and draw the tenant’s specific attention to any specific clauses or obligations within the tenancy agreement.

Investigation

When there is more than one tenant, there is a joint responsibility towards the Tenancy Agreement and all are accountable for looking after the property and paying rent. A deposit is taken on behalf of all tenants and is usually refunded to the lead tenant at the end of the agreement, subject to any agreed deductions. The tenant thought her liability had ended as she had served notice and left the property, whereas the agent said the tenant had not been replaced so remained jointly responsible.

The initial Tenancy Agreement was taken out for a fixed term of twelve months. A month prior to the end of the twelve months, the tenants and the landlord were contacted by the agent to see if they wished to extend the tenancy, which all parties agreed to.

There was no evidence that the extension was confirmed in writing to clarify the extended tenancy dates or the notice period that applied.

Due to the original Tenancy Agreement being for a fixed term, it did not state a set amount of notice that must be given by tenants.

Given these circumstances, in the event of the tenant confirming she wished to leave the property, the agent, as a matter of best practice, should have advised, in writing, the amount of notice needed to be given and the change of sharer process, which was applicable. This should have included the arrangements for the tenant’s proportion of the deposit.

Whilst there was evidence that the change of sharer process was explained in writing to the new sharer, the Ombudsman could not find any record of this being provided to the tenant or that she was advised that she could only be released from the contract if a replacement tenant was found. Without this information, the tenant came to believe that her responsibilities had ended.

Changing sharers can become complicated and due to the additional complications of Covid-19, the agent should have made sure they provided clear and transparent guidance to the tenant before she vacated so she was fully aware of the situation and what needed to happen to end her responsibilities. The tenant was a student and had little experience of renting or tenancy law. However, after receiving legal advice, the tenant eventually served a written notice to end the entire tenancy so she could retrieve her deposit back. This was also an option the agent could have discussed with all parties considering there were complications with the sharer taking over. The remaining tenant would then have been able to decide if she wished to stay at the property, either by herself or with the other sharer, and a new Tenancy Agreement could have been drawn up accordingly with a new deposit paid.

Outcome

The Ombudsman identified shortcomings in the agent’s communication and considered there were opportunities to resolve the matter sooner.

Tenants do not always fully understand their legal tenancy obligations and often require guidance to make informed decisions. This is especially relevant where notice periods would not necessarily be covered within the wording of a joint Tenancy Agreement and there is a proposed change of occupants.

The Ombudsman therefore concluded that the agent did not meet their Code obligations to provide guidance to the tenant regarding the ending of her part of the Tenancy Agreement when the other tenant remained in situ and how the change of sharer process would affect her liabilities and the return of the deposit.

The Ombudsman supported this complaint and made an award of £200.

January 3, 2022

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