The DPS to launch Insured Scheme alongside its Custodial Scheme

We’re excited to announce that we have been granted approval by the UK government to run an insurance based deposit protection scheme in England and Wales. We currently run the only custodial based deposit protection scheme in England and Wales and we will be the only scheme to offer landlords and letting agents both options.

The new insured scheme is due to launch in April 2013, with landlords and letting agents able to register in advance from the 1st October 2012.

Following in the footsteps of our custodial scheme, landlords and letting agents will be able to register with the service online as well as by phone, and manage both their custodial and insured deposits through one easy online account.

The DPS insured scheme will not charge registration fees to customers and will provide industry competitive protection fees for landlords and letting agents when the scheme launches in April.

Participation in The DPS insured scheme will be open to all private landlords on a pay as you go basis. Letting agents will need to be members of professional bodies with Client Money Protection insurance.

A one stop shop

With the addition of the insured option, we’re able to provide customers with what is effectively a ‘one stop shop’ for deposit protection. Kevin Firth, Director of The DPS, said:

“We’re delighted to be able to announce a new insurance based deposit protection scheme from The DPS brand. We strive to provide the industry with an excellent service and offering both insured and custodial options will ensure landlords and letting agents have the choice of protection from the leading supplier of TDP in the UK.”

We’re here to help

Lately we’ve had quite a few people ask us questions on our twitter page @The_DPS. While we will always try to help where we can, messages on twitter can be seen by everyone so we can’t answer questions about a particular deposit for reasons of customer confidentiality. If you have a question about your deposit, there are plenty of ways to get in touch. You can fill in our online form, call us on 0844 4727 000, or you may find the answer in our FAQs for tenants and landlords, or by asking our virtual agent Emma.

 

Logging in to The DPS

We have also had some tenants contact us asking questions about the repayment process, so here’s some top tips to help:

1)    If you log in with your Deposit ID and surname, you will be able to view the details of the deposit, but you will not be able to action the repayment process. This is for security reasons, to ensure changes to the deposit can only be made by those who are authorised.

To log in and complete the repayment process the lead tenant or sole tenant needs to log in with the Deposit ID AND Repayment ID. 

2)    If you do not know your Repayment ID, you can request a new one by filling in our online form or by texting REPAY followed by the Deposit ID and deposit amount to 07537404808.

3)    If you do not know your Deposit ID, you can find it on your deposit submission confirmation, or your landlord or agent should be able to provide it. If not, call us on 0844 4727 000.

4)    Remember, keep your Repayment ID safe – it’s unique to you like a PIN number and shouldn’t be shared with your landlord or agent (they will have their own unique ID number). The Repayment ID grants authorisation to repay the deposit, so make sure you keep it confidential.

Do you have properties in Scotland?

As you may be aware, the Scottish government has introduced legislation which makes it compulsory for landlords and letting agents to submit their tenants’ deposits into a government approved custodial scheme. Computershare Investor Services PLC, the company that runs The Deposit Protection Service in England and Wales (The DPS), also runs a government approved deposit protection scheme in Scotland – The Letting Protection Service Scotland (The LPS Scotland). In fact, The LPS Scotland was the first such scheme to be approved by the Scottish Government.

If you have properties in Scotland, you will need to start protecting the deposits of your tenants for these properties. To make it easier for you, we have developed an online calculator which you can use to work out when each deposit you may have for a Scottish property will need to be protected in order to comply with the new legislation.

Unlike England and Wales, there aren’t any insurance-based schemes to protect Scottish tenancy deposits. Approved providers are operating custodial schemes – like The DPS – where the deposit monies are handed over to the scheme to hold for the duration of the tenancy. The DPS has been running for over five years, and The LPS Scotland is the only provider to be run by a company that has prior experience of running a custodial scheme.

If you would like to find out more about The LPS Scotland and your obligations under the new legislation, you can visit the website or call the team on 0844 472 6666. You can also follow them on twitter @LPS_Scotland.

Meet the team – Kerry Laws, ADR Case Handler

What does your role involve?As part of the ADR case handling team it’s my job to process the evidence received from landlords, letting agents and tenants before it is handed over to the Adjudicators who make the final decisions. I’m also responsible for:

› processing responses to Single Claims › allocating work out to other team members › responding to emails from all parties; and › reviewing cases where tenant evidence has not be supplied by the deadline and processing payment to the landlord or letting agent.

What’s the funniest thing you’ve seen whilst in the role? We once had some urine stained pieces of carpet sent in to us as evidence. It certainly wasn’t funny at the time but looking back, it does make me giggle – some landlords take evidence submission very literally!

What’s the best thing about your role? Our team is incredibly busy and manages a big workload on a daily basis. In any one day we could each process 25 sets of evidence. So being able to turn work around before my deadlines is hugely satisfying. We allow a four day turnaround to pass evidence and case notes to the adjudicators but I always try to process items within two days instead.

There’s also a small part of me that looks forward to what we may get sent in by way of evidence each day, sometimes that back-fires as I explained above!

What’s most challenging? We often have a lot of correspondence and other evidence to sift through which makes my role very painstaking. The most challenging part is sometimes finding out what the landlord, agent or tenant means in their evidence and emails – quite a bit of time can be spent deciphering meaning, grammar, spelling and hand writing.

If you’re looking for guidance on deposit disputes, download our ‘Guide to tenancy deposits, disputes and damages’ today.

Meet the team - Alexandra Coghlan-Forbes, Head of Adjudication

What does your role involve?I am a Chartered Legal Executive with 20 years experience in the legal profession. I worked in private practice, for local government and a housing association before taking up my role here in 2008.

I am responsible for the team of in house adjudicators, allocating the cases which are ready for adjudication, ensuring that they are completed within the required deadlines, and providing advice, assistance and support to the adjudicators in respect of the decisions they make. I also complete a number of decisions myself.

What’s the funniest thing you’ve seen whilst in the role? There are two things that spring to mind. The first was a landlord who sent in dirt, dust and mouldy sweet wrappers from the loft show me that the tenant had been ‘living’ up there. The second was a tenant who wallpapered the lounge of their rental property using silver foil!

What’s the best thing about your role? I am very conscious that all cases must be given full and fair consideration, and enjoy the challenges of making practical decisions in respect of actual disputes. I have adjudicated in thousands of disputes, and can honestly say that no two cases are ever the same!

I also run a practical case study in respect of adjudication in the ADR Workshops which are run by the DPS for Landlord’s and Agents. This is, I hope, an interesting insight into the role of an adjudicator. I usually find that by the end of the session most participants come up to me and say “I’m glad I don’t have to do your job!”

However, I’m glad I am doing it! I enjoy the challenge and the satisfaction I get from ensuring the quality and integrity of our decisions.

What’s most challenging? Probably reading comments on social media sites which suggest the outcome of an Adjudication was unfair. In most cases, we’re unable to identify who the aggrieved party is, and therefore have no way to reply.

If complaints about the decisions are raised with us directly, we would hope to be able to provide further clarification or explanation as to why the landlord, letting agent or tenant may have lost. In most situations, the reason a landlord’s claim fails is because the evidence they presented was not sufficient. Querying the outcome directly with The DPS is often an important way in which landlords can learn from their past bad experience and improve their evidence in future claims.

The DPS runs regular ADR workshops in which you can improve your evidence submissions. Keep an eye on our website where we post details of future events.

Meet the team – Chris Jackson, Customer Service Representative

What does your role involve? I’ve worked for The DPS for almost two years and I take inbound customer service calls in the contact centre, provide help and advice and resolve our customers’ account issues on a daily basis.

Usually, the calls are from tenants, letting agents and landlords wanting to know something about their account or deposits but we occasionally receive calls from solicitors and other third parties as well.

We’re able to access our customers’ account details so that when they call we have all the information we need via The DPS administration site – so we can see records of all previous notes, deposits and any issues in order to fully assist the caller.

When call volumes are high my days can be pretty full on and I can take up to 15 calls per hour. During quieter periods we catch up on admin and perform follow-up to the day’s calls.

What’s the funniest thing you’ve heard whilst at The DPS?

The funniest call we’ve received in the contact centre was actually nothing to do with deposit protection at all! One of my colleagues took a call the other day from a gentleman requesting we issue him with a new copy of his driving licence as he had lost his old one – unfortunately, we were unable to assist but did point him in the direction of the DVLA!

What’s the best thing about your role?

Being able to solve problems and send customers away happy. As a CSR I’m normally the first point of contact The DPS customers and my aim is always to make their telephone call a pleasant experience. In most cases, I am able to answer the question over the telephone, and it is always nice to receive a ‘thank you’ from the customer at the end of the call.

As well as the satisfaction of helping our customers, I love the people I work with! Everybody is very friendly and supportive; even colleagues in other departments who I don’t see on a daily basis. With the best will in the world we can’t answer all calls right there and then so need to call on the wider DPS team – they’re always professional and look to assist me as promptly and efficiently as they can.

What is Most Challenging? The most challenging aspect of the job is when I find myself in a situation where I’m unable to assist a customer over the phone. For example, the question could relate to a decision reached by an Adjudicator, in which case this has to be referred to the adjudication team. In this instance I’d normally ask the customer to send the enquiry to us in writing to ensure the customer gets their answer as soon as possible.

If you’ve been meaning to get in touch with us about an enquiry, give our team a call on 0844 4727 000 – you might get to speak to Chris!

Welcome to our ‘Meet the team’ series!

We have a great team here at The DPS and I’m sure you’re all wondering what they get up to on a daily basis! Well now’s your chance to find out. We’ve asked several of our team members to write a blog for you, introducing themselves and what they do as part of The DPS. Among those contributing will be Chris Jackson, one of our Customer Service Representatives. You’ll also hear from one of our letting agent Account Managers, an ADR case Handler and our Head of Adjudication.

To kick things off though, here’s a little bit about our Director, Kevin Firth, in his own words.

What does your role involve? I have overall responsibility for The DPS, including our employees, our systems, the decisions we make and the service we provide. No pressure then !!

What’s the funniest thing you’ve seen whilst in the role? A landlord had walked around their rental property in bare feet, gathering the dust and crumbs from the floor, then sent us the picture of her feet as evidence that the tenant had not cleaned the floor. Whilst adjudication is a very serious issue with sometimes quite large sums of money at stake, every now and then a landlord’s interpretation of a paper-based service provides for some light relief.

What’s the best thing about your role? I like attending and hosting events because it gives me the chance to meet with landlords, letting agents and tenants and find out what they think of the service, what they think we do well, and ways in which they think we could enhance the service. We’ve updated several of our processes following feedback from our customers and it’s made the scheme more efficient over the years.

What’s most challenging? Raising awareness amongst tenants to ensure their landlords and letting agents are complying and protecting their deposits. It’s harder to spread the message amongst the tenant community as it’s constantly changing and we’re always looking for different ways to reach them. Social media channels like Twitter are helping us reach this audience and we’ve got nearly 2,500 followers.

Changes to tenancy deposit protection from 6th April 2012

The Localism Act achieved Royal Assent in December and the DCLG has now confirmed that changes to tenancy deposit protection, introduced by the Bill, will come into force on 6th April. Tenancies already in place on this date will have 30 days in which to comply with the new rules. Here’s a recap of the changes due to take effect as a result of The Localism Act:

30 days – not 14 – to protect deposits

From 6th April, landlords and letting agents have 30 days from receipt of deposit in which to protect it.

The re-wording and extension of this timeline also closes the loophole with regards to deposit protection deadlines that was highlighted by cases such as Universal Estates v Tiensia in 2010.

Now, if a deposit is not protected within 30 days, the tenant can take their landlord or letting agent to court – there is no other way to interpret this legislation.

Prescribed Information

The requirement for providing the Prescribed Information to the tenant will also be changed to within 30 days of receipt of the deposit.

Whilst we provide a template for Prescribed Information on our website, it is the landlord or letting agent’s responsibility to ensure it is issued at the correct times so it’s vital they review the Localism Act and understand when Prescribed Information should be issued.

No retrospective protection after the tenancy ends

If a tenant makes an application to the county court once the tenancy has ended, the landlord will no longer be able to retrospectively protect the deposit in order to comply with the Act. If the tenancy has ended, the only option is for the landlord to repay the deposit, or part thereof, to the tenant.

Revised sanctions for non protection

The changes give the courts discretion to award not less than the amount of the deposit and not more than three times that amount depending on the individual case. For example, a repeat offender may find themselves with a larger fine compared to a landlord who has simply forgotten to protect as  an administrative oversight.

Section 21 notices

Further clarity to Section 215 of the Housing Act highlights that a section 21 notice may not be given where a deposit has not been protected within the 30 day period. However, there are exceptions to this which you can view in The Localism Act.

For a comprehensive explanation of each change, read our blog from September 2011 – ‘Tenancy deposit protection amendments proposed by the Localism Bill’. You can also read the The Localism Act (section 184) and view the amendments against the Housing Act 2004 (sections 213 – 215 are relevant).

We’ve returned 1 million tenancy deposits!

On Tuesday we paid back our one millionth deposit to Yvonne Stenning, a tenant from South East England! It’s great to have hit the million milestone just before our 5th birthday on April 7th and to mark the occasion, we’ve sent a bottle of champagne to the tenant and letting agent.

When we called Yvonne to let her know she said: “It’s a lovely gesture particularly as it was such an easy process; The DPS did all the hard work!” 

Her letting agent Wendy Carman from Molica Franklin, was pleased too: "We protect all our deposits with The DPS and it was a big surprise to be called and offered a bottle of bubbly! I'm thrilled it was Yvonne's deposit, she’s a wonderful tenant."

Since 2007, when The DPS started, we have returned deposits worth over £750 million to tenants, landlords and letting agents.

As the only approved custodial tenancy deposit protection scheme in England and Wales, we’ve focused on honing our unique repayment system to ensure that deposits are repaid as fast as possible. As soon as we have agreement from both parties, we can repay deposits within 2 days so that tenants can quickly use their cash for future lettings, for instance.

We re-pay an average of 950 deposits a day to recipients across England and Wales and work really hard to make things as simple as possible for everyone involved. We’re aiming to launch in Scotland too in the very near future, so landlords and tenants there will be able to take advantage of the same tried and tested system.

We currently protect over 840,000 deposits worth £660 million on behalf of tenants, landlords and letting agents. Our operating company, Computershare, is awaiting approval to launch The Letting Protection Service Scotland (The LPS Scotland) – a service that will provide similar protection to tenants, landlords and letting agents in Scotland.

The experience we’ve gained during five years of protecting and repaying deposits in England and Wales is of huge benefit to the Scottish market and we’re spending a considerable amount of time in the region talking to landlords and agents who have to start making changes to the way they treat tenancy deposits.

Tenancy deposit protection legislation is expected in Scotland towards the end of April 2012. For more information, visit http://www.lettingprotectionscotland.com/.

ADR Insight: DIY SOS - tenants painted my living room bright pink!

As a general rule, responsibility for decorating a property lies with the landlord. However, we see a number of disputes each year where the parties agreed to the tenant redecorating but the precise details were not clearly defined. Landlords who find that their calm and tranquil magnolia property has been returned in fuchsia pink, turquoise blue or pillar box red can be understandably shocked at the changes to the property. Here are a few of the statements we often see in evidence and the potential flaws with each of them:

1    Landlord says: ‘I told them it was ok if they used a neutral colour’

[caption id="attachment_964" align="alignright" width="300" caption="'You said yes, as long as it's neutral...yellow is neutral isn't it?'"][/caption]

What is a neutral colour? Most would assume magnolia, cream or beige but the landlord’s definition may be very different to the tenant’s, so it is helpful to be clear about what constitutes a ‘neutral’ colour.

2    Landlord says: ‘I told them they could use whatever colours they liked as long as they repainted it all back to original colours at the end of the tenancy’

If the details of the decorating agreement are not clearly set out in writing, it is difficult for the landlord to prove that such a discussion took place. Therefore it is unlikely to result in the claim being awarded in the landlord’s favour.

3    Landlord says: ‘I didn’t give permission’ but tenant says: ‘I told them I was going to redecorate and they didn’t object’ or alternatively ‘the landlord has been round many times since I redecorated and said how lovely it looked’.

Again, the precise details of any permitted decoration needs to be clearly defined.  Depending on what is said in the Tenancy Agreement, the tenant’s argument is unlikely to be persuasive in this instance, particularly if the agreement requires written permission from the landlord.

4    Landlord says: ‘I gave tenant permission to redecorate but they botched it and it looks awful’.

You may wish to include a requirement in the Tenancy Agreement that if the tenant is going to redecorate, the landlord is entitled to inspect the results. If they’re not satisfied the tenant can be asked to do it again, or the landlord can complete the works at the tenant’s cost. Alternatively, the landlord could insist that the tenant uses a professional to decorate the property.

Often Tenancy Agreements will state that the tenant can redecorate if the landlord’s written permission is given. Our adjudicators often see letters from landlords which simply allow the tenant to redecorate without stating the specific parameters. It is helpful to fully define them, so for instance an agreement may be drafted to confirm:

›       What rooms are being decorated

›       What colours are being used – this could include reference to colour charts or even sample wallpaper

›       Who is doing the redecoration – the tenant, or a professional decorator

Either way you should have something in writing, which is dated and signed by both the tenant and the landlord, that sets out the rules for redecoration so that the details agreed at the time can be absolutely proven.

Whilst disputes over redecorating are most common, if there is any agreement for other works to be carried out to the property by the tenant, such as alterations to the garden or carpets, or if for example appliances are being replaced, it is always prudent to document these and ensure that the terms are agreed by both parties at the time.

Our ‘Guide to tenancy deposits, disputes and damages’ provides comprehensive information and advice about deposit disputes – you can download the guide from our website.

The DPS – a year in review

Undoubtedly the hottest topic on the property pages has been the rapid rise of the private rented sector. Monthly rental values soared and tenant population increased as the housing market struggled. Letting agent Haart released figures in December 2011 that showed a 10% increase in the number of people registering with them over the last 3 months – a trend they expect to continue this year.

Activity at The DPS over the last year has also increased in line with this report. Since April 2011, monthly registrations and deposit submissions have been higher than last year. Here are some of the highlights:

›  Nearly 1 million deposits repaid since scheme launch in 2007

›  825,000 deposits worth £644 million currently protected on behalf of 166 organisations, 280,000 landlords and letting agents.

›  191,000 enquiries through Emma, our online virtual agent

›  69,000 text message reminders sent

›  50,000 deposit submissions in September – always a peak month but this was 4,000 more than 2010.

›  6,000 new landlords in August - 500 more than in 2010

›  600 adjudications completed in November – twice as many as last year but you’d expect this rise as the scheme matures

›  450 new letting agents in October

The DPS has the infrastructure and capability to easily deal with any rise in registrations, submissions, repayments and adjudications. With a new look website launched late last year and several new features that make deposit protection even easier for those landlords and tenants who are new to deposit protection, we’re more than ready to cope with further increases expected in 2012.

A landlord’s work is never done…

Landlords and letting agents never rest, particularly when there is so much demand on rental property and it seems several didn’t even take a break over Christmas and New Year.

›  We registered 5 new landlords on Christmas Day and a further 59 on New Year’s Eve.

›  15 deposits were submitted on Christmas Day and another 187 on New Year’s Eve

›  The latest deposit submitted on Christmas Day was at 23:09. On New Year’s eve, the last deposit was registered just in   time for fireworks and champagne at 23:41!

The year ahead…

We’re all very excited about taking deposit protection to Scotland this year and are currently awaiting approval from the Scottish Government to launch The LPS Scotland. We’re expecting this to be in April this year, so if you have rental properties in Scotland, get familiar with the requirements on the website and blog.

On behalf of everyone at The DPS, I wish you all the best for 2012.

ADR Insight – don’t neglect your rental property over the Christmas period

As you know, you can never fully switch off from your responsibilities as a landlord, whether that be taking on new tenants, completing deposit disputes or making sure your property is kept in good condition over the festive period. There are a couple of things you can do to make sure your properties are in order, ensuring the safety of your tenants and hopefully a stress-free Christmas for you.

Are your tenants leaving the property over Christmas?

Our adjudication team received a lot of claims earlier this year following the severe winter weather in 2010. The majority were the result of burst or frozen pipes at student houses where tenants had left the property to spend Christmas with their families.

In the worst cases seen by our adjudicators over the years burst pipes have resulted in damage to carpets and flooring, kitchen appliances needing replacing and claims for lost rent whilst damage is repaired. Some landlords have faced repair bills of several thousand pounds.

To avoid this stress and expense, you should contact your tenants if they’re going away to ensure that the proper measures are taken to avoid this kind of damage.

The AIIC has issued some guidance on keeping your properties safe during cold spells:

›   Insulation – Ensure water pipes and tanks are lagged and insulated.

›   Heating – Advise tenants to keep the heating on, at a min. of 15 degrees, if they’re going away. It’s also sensible to open the loft hatch allowing air to circulate and prevent pipes freezing and bursting in the loft.

›   Boiler servicing – Ensure that gas and oil boilers are serviced every 12 months.

›   If the property is going to be empty for an extended period it’s sensible to have the heating/water system drained by a qualified contractor.

›   Chimneys – Ensure they are swept once a year by a professional chimney sweep, ideally before the tenant starts using the fire.

›   Smoke Alarms – Check that smoke alarms are fitted in all properties and that they are all working properly. Replace batteries as necessary.

Be aware of evidence submission deadlines

If you’ve currently got a deposit in dispute then don’t forget to stick to your evidence submission deadlines. The DPS is not extending any deadlines but is making allowances for bank holidays so if you’re concerned about a deadline then get in touch so we can see what we can do for you.

Our Christmas opening hours

If you’re taking on new tenants over Christmas or the New Year you can submit deposits at any time online. If you need assistance our contact centre opening hours are:

Friday 23rd - 8:30am – 4:00pm

Monday 26th - CLOSED 

Tuesday 27th - CLOSED 

Wednesday 28th – 8:30am – 5:30pm

Thursday 29th – 8:30am – 5:30pm

Friday 30th - 8:30am – 5:00pm

Monday 2nd - CLOSED

You can also get in touch via online form or why not ask Emma, our online customer service agent.

Finally, a very merry Christmas to you from everyone at The DPS!

The DPS makes tenancy deposit protection even easier

We’ve made protecting and returning tenants’ deposits even easier with our latest service enhancements. As well as a new look website which launched successfully this week, we’ve introduced:

› Repayment ID reminders via text message › ‘Organisation’ as a new registration category › Incremental deposit payments › Simplified direct transfer process › Ability to cancel joint repayment claims started in error

The enhancements are part of our ongoing commitment to simplify deposit protection and, more crucially, speed up the repayment process.

Whilst repaying deposits only takes two days once we have agreement from both parties, the biggest barrier is misplaced repayment IDs by both tenants and landlords each month – without these, they cannot start or complete the deposit repayment process.

The latest addition to our SMS service is the fastest way for tenants to receive repayment ID reminders. Tenants simply text us and ask for a repayment ID reminder. We’ll then instantly issue the reminder via return text message. Tenants can only use this service if their mobile number is registered, so it’s important that landlords register the correct mobile number for their tenants.

The enhancements also coincide with our application for a licence to take our considerable experience as the UK's only custodial tenancy deposit protection scheme and apply it to Scotland.

Here’s a little more information on each of the enhancements launched this weekend:

SMS repayment ID reminders Tenants can text The DPS requesting a reminder of their repayment ID. The DPS will instantly issue the reminder via return text message so it is important that landlords ensure a correct mobile phone number is registered for their tenants.

New registration type Organisations such as NHS Trusts, companies or Universities can register deposits as an ‘organisation’ rather than ‘letting agent’ or ‘landlord’, if they do not fall into either of these two categories.

Incremental deposit payments Landlords, letting agents and other organisations can now pay deposits in stages if their tenant is unable to pay the full deposit upfront, or has agreed a payment plan prior to taking the tenancy.

Enhanced direct transfer payment service This enhanced process makes it easier for landlords, letting agents and other organisations to pay for new deposits.

Ability to cancel joint repayments if started in error Previously the requesting party would have had to contact The DPS to rectify any errors, causing delays in getting their deposits back.

Revamped website The new website allows easier navigation to the pages that visitors need to access. Whether the user is already registered and protecting deposits or simply browsing the site, they can quickly access information that is relevant to them with regard to managing deposits or getting help online.

For more information visit our new-look website.

ADR Insight: Stick to the facts and don’t get personal

They don’t call it dispute resolution for nothing – but there are some cases that take disputes over deposits to a more personal level. Landlords and tenants enter into a contractual relationship and, like any other relationship, this can ‘irretrievably break down’ during the course of the tenancy.

We’ve seen several cases where this has happened. The relationship breaks down to such an extent that tenants withhold rent as they feel the landlord hasn’t maintained the property correctly, or in some cases, the aggrieved tenant has trashed a property as a result of the disagreement.

When it comes to a head like this, adjudicators can be left to deal with the fallout and find themselves wading through lengthy and heated email or text message exchanges between the parties in order to establish the real facts of the case.

A recent case got so personal that it wouldn’t have been out of place on ‘Jeremy Kyle’! The initial evidence involved a 13-page typewritten submission which was largely a tirade of abuse – referring to the other party as, amongst other things, habitual liars, alcoholics, weak, lonely, unhappy, angry, unbalanced and violent. 

Not surprisingly, the other party responded with an 18-page typewritten submission that claimed their opponents were abusive and rude, harassed them, made personal insults, had mental health issues, threatened them and made nuisance calls to them.

With this abundance of excess information, the real facts of the case can get lost and in some cases delay a decision due to the sheer volume of correspondence to trawl through. It can also confuse the outcome and mean that a fair decision cannot be made.

Whilst our adjudicators wouldn’t ever prevent the disputing parties providing anything which they feel is required for the adjudicator to come to their decision, it’s advisable to stick to the facts where possible.

Attempts to assassinate the character of the other party are rarely helpful to the claim and are unlikely to be given much weight by the adjudicator. A clear and factual account of the tenancy, a chronology of events, clear evidence of the condition of the property and invoices/estimates/receipts will always be much more persuasive.

If you need help or guidance on how to tackle a deposit dispute our ‘Guide to Tenancy Deposits, Disputes and Damages’ gives further information on the adjudication process and the way a decision will be reached.

Over 50% of landlords protect their deposits with The DPS

I’ve just been reading the Private Landlords Survey 2010 (PLS) which shows that 53% of landlords operating in the private rented sector (PRS) use The DPS to protect tenancy deposits. The PLS is a national survey commissioned by the Department for Communities and Local Government (DCLG). It assesses landlords and letting agents who let or manage private rental properties in England.

The survey looks at every aspect of private letting, from acquiring rental properties to letting them out and maintaining them.

You can read the full report on the DCLG website but I’ve listed some of the key findings relating to tenancy deposits here:

›       91% of all landlords (controlling 84% of all dwellings) in the PRS required a deposit before letting.

›       53% of the landlords in the PRS used the custodial scheme, while 34% used an insurance based scheme and 14% used both types of scheme.

›       99% of letting agents were aware of the authorised TDP schemes and 93% used one.

›       67% of landlords were aware of the authorised TDP schemes and 39% used one.

›       33% of landlords were not aware of the authorised TDP schemes

Whilst it’s great to see so many landlords choosing the custodial scheme to protect deposits, it’s worrying that over a third are still unaware of the schemes.

Even 5 years down the line, there’s clearly still work to be done in educating the lettings industry about tenancy deposit protection. Particularly given the continued rise in rent prices – average private sector rents in England and Wales rose by a further 0.7% in September to a new monthly high of £718*.

Higher rental prices mean higher deposits for tenants to part with so it’s more important than ever that all landlords and letting agents comply with tenancy deposit legislation.   

If you’re not currently registered with a scheme and want to find out more, we have plenty of information on our website.

*Source:  LSL Property Services

DPS operating company has applied to protect tenancy deposits in Scotland

As you may know, the Scottish Government is introducing legislation that will make it compulsory for all landlords and letting agents in Scotland who take deposits for a relevant tenancy to protect them with a Government approved tenancy deposit scheme. Unlike England and Wales, there won’t be any insurance-based schemes to protect Scottish tenancy deposits. Approved providers will operate custodial schemes – like The DPS – where the money is handed over to the scheme to protect for the duration of the tenancy.

The LPS Scotland – run by the same company as The DPS – has submitted an application to run a scheme and, once approved by the Scottish Government, will be the only provider in Scotland with any experience of running a custodial tenancy deposit protection scheme.

There are some differences in the Scottish requirements to those in England and Wales which we’ll be looking to communicate with our landlords and letting agents with properties in Scotland very soon.

I’m also giving a presentation on 9th November in Edinburgh to introduce the legislation, what it will mean for landlords, letting agents and tenants and how The LPS Scotland will work once approved.

I’ll also talk about our experience of running the DPS in England and Wales and how that knowledge will benefit the running of The LPS Scotland.

If you’re a registered DPS landlord or letting agent with property in Scotland why not come along to find out how it will affect you - email The LPS Scotland to register your interest.

To find out more about The LPS Scotland, visit the website or read the latest blog post:

The Letting Protection Service Scotland (The LPS Scotland) prepares to protect tenancy deposits

You can also follow them on Twitter (@LPS_Scotland).

Kevin Winchester shares his approach to avoiding deposit disputes

[caption id="attachment_886" align="alignright" width="200" caption="Kevin Winchester, MD of Winchester Lettings"][/caption] Since the law regarding deposits paid by tenants to landlords or lettings agents changed in April 2007, disputes over the deposit have been a common problem at the end of the tenancy. For example, the landlord will say the tenant has damaged something and the tenant will say it was like it when they moved in.

I can thankfully say that we’ve been one of the few agents that haven’t had this problem and below are some of the reasons why we never really get disputes.

First and foremost, we produce a very detailed check-in inventory and schedule of condition. The more time taken compiling one the better, with date and time stamped photos preferably as these can be used to show a very real portrayal of how the property was handed to a tenant. If the property is professionally cleaned beforehand keep the receipt and add a copy of it to the inventory. Both the landlord / agent / check-in clerk and tenant should mutually agree that the inventory is accurate. I’ve seen some pretty basic inventories in my time and it’s this type that is open to being ambiguous.

Don’t rely on a very tight tenancy agreement with clauses about cleaning etc. as these types of clauses can be deemed unfair – see the Office of Fair Trading website regarding unfair tenancy terms.

Carry out regular inspections on your properties; mark my words if you never make any inspections you may end up getting a shock when they leave. I’d suggest a visit once a quarter as a minimum - ideally on different dates and times – and take a camera to log any damage caused; it’s a great way of ensuring your tenants are looking after the property and if anything is of concern it can be nipped in the bud straight away.

If you have to provide maintenance to a rented property don’t ignore it as these problems will get worse over time and cause more damage to your property. Landlords have to comply with the statutory repair obligations in section 11 of the Landlord and Tenant Act 1985, and if you get work done promptly then a tenant will be a lot more conscious that you like to keep things nice.

When you receive notice from your tenant that he/she intends to vacate, send them a letter prior to check-out advising them of your expectations and arrangements for key handover and final meter readings. We always add instructions for things like cleaning and gardening to this letter to highlight what we expect to be done prior to the meeting. We also send a copy of the check-in inventory for the tenant to refer to.

A couple of days before the check-out meeting make another inspection; this is your chance to assess any potential problems you could face at the exit meeting. Again take photos and document what you see.

The check-out meeting should be conducted using the agreed check-in inventory and it’s at this point that you’ll need to assess what is genuine wear and tear or what is actual damage - if there is any!

If you need advice on what is considered fair wear and tear then I suggest you buy 'A Guide to Best Practice for Inventory Providers’ which you can get from The Association of Professional Inventory Providers. If you’re not a member of a professional body it will cost you around £100.00 which is a worthwhile investment – we refer to it all the time!

If there is a dilapidation that needs to be addresses, try making an agreement with your tenant there and then and discuss the likely cost to rectify. For instance, if the property has not been cleaned but you had the property professionally cleaned prior to them moving in, refer to the receipt in the inventory as the cost is already there.

If you need to get quotes for any work then aim to get at least 3 so you can show due diligence in obtaining the best contractor. It’s also a requirement if you decide to use an ADR service.

Finally, always try to come to an amicable agreement regarding the repayment of a tenant’s deposit: remember the golden rule - ‘the burden of proof lies with the landlord'.

Kevin is Managing Director of Winchester Lettings Group – based in Bromley, Kent – a dedicated property lettings specialist that deals with every aspect of residential lettings and property rental management.

These opinions are those of the writer and not necessarily those of The Deposit Protection Service.

ADR Insight: "But I was on holiday?"

We’re always advising landlords that for deposit dispute claims to be successful they have to provide as much relevant evidence to support their claim as possible, as this is absolutely crucial for adjudicators to make educated and informed decisions. However, it’s equally important that evidence is submitted within our published deadlines. Landlords have 14 days to submit all the evidence they would like considered in relation to their claim. If we don’t receive anything within the two weeks, we will repay the full amount to the tenant as we have nothing to assess the claim against.

When we receive the evidence, we send a summary to the tenant giving them 14 days to respond. Again, if there’s nothing received from the tenant, we repay the disputed amount to the landlord.

We appreciate that it is frustrating to both parties when the deposit that they believe they have a rightful claim to is repaid in this way, but the ADR process is intended to be a faster alternative to the courts which is why evidence submission deadlines are imposed.

To give yourself the best chance during a dispute, we offer the following advice :

›       Create a legally binding signed tenancy agreement

›       Provide a thorough inventory and schedule of condition report (signed)

›       Complete a check-in and check-out with the tenant present

›       Keep hold of all correspondence, invoices and other admin that may be relevant

Having done all that, you wouldn’t want to fall at the final hurdle so make sure you get everything to us within the 14 days.

If for any reason you can’t meet that deadline, let us know as soon as possible so we can arrange an extension for you.

For more information on ADR best practice, read our Essential Guide. There is further information on evidence and deposit disputes in our Guide to Tenancy Deposits, Disputes and Damages.

Government issues guidance to the lettings industry

Housing Minister Grant Shapps published new factsheets last week to give landlords and tenants a better understanding of their roles and responsibilities whilst renting or letting a property. The landlord factsheet provides advice on picking a letting agent, making sure the property is safe for tenants, producing tenancy agreements and inventories and protecting tenants’ deposits. The information for tenants includes tips on the legal requirements of renting, avoiding disputes and what to expect from landlords.

By providing access to better information on roles and responsibilities, Mr Shapps hopes that unnecessary disputes can be avoided during and at the end of assured shorthold tenancies.

The factsheets are free to download and you can access them here:

›       Top tips for landlords

›       Top tips for tenants 

They also include contact information for various organisations – like Shelter and Citizen’s Advice Bureau – that will be able to help if you’re looking for more information. 

We have also made the factsheets available on the tenant and landlord information sections of our website.

Tenancy deposit protection amendments proposed by the Localism Bill

At our ADR workshop in Leeds last week I was interested to learn that some of the attendees weren’t aware of the changes proposed by the Localism Bill that will affect tenancy deposit protection under the Housing Act 2004 (the Act). With that in mind I thought it would be useful to summarise them here:

30 days – not 14 – to protect deposits and issue Prescribed Information

Currently the Housing Act requires that landlords/letting agents protect a tenant’s deposit within 14 days from the day it is received – the Localism Bill has proposed that this be amended to 30 days. This will remove landlord’s/agents’ ability to rely on ‘administrative oversight’ for any delay in protection.

The requirement for providing the Prescribed Information to the tenant will also be changed to within 30 days of receipt of the deposit.

Closing the loophole

Following high profile court cases – like Universal Estates v Tiensia late last year – the Localism Bill has proposed a change that will close the loophole regarding the ‘initial requirements’.

Rather than it being mandatory to comply with the ‘initial requirements’ of a tenancy deposit scheme, the proposed change will give tenants the ability to approach a county court to enforce compliance by a landlord with its obligation to protect the deposit and supply the Prescribed Information – where this has not been done – within 30 days of receipt of the deposit.

Protection after the tenancy has ended

If a tenant makes an application to the county court once the tenancy has ended, the landlord will no longer be able to retrospectively protect the deposit in order to comply with the Act.

Currently the courts can order either the repayment of the deposit to the tenant, or the immediate protection of the deposit with a custodial scheme. A new proposed subsection to the Act will ensure that if the tenancy has ended, the only option is for the landlord to repay the deposit, or part thereof, to the tenant.

Revised sanctions for non protection

Currently, if a landlord is required to pay a fine to the tenant for failing to comply with the Act, then the judge has to award three times the amount of the deposit. Under the new proposals the Judge will have discretion to award not less than the amount of the deposit and not more than three times that amount.

Section 21 notices

Section 215 of the Housing Act will also be amended to provide clarity that a section 21 notice may not be given where a deposit has not been protected within the 30 day period under section 213(3) or (6), however this prohibition may be mitigated where:

  • the deposit has been returned to the tenant in full or with such deductions as have been agreed;
  • an application to the county court under section 214 has been made and has been determined by the court or withdrawn or settled between the parties.

The above changes are awaiting Royal Assent; if they’re passed they will come into force in April 2012. We’ll keep you updated on the progress of the Bill and if passed we’ll let you know of any enhancements we’ll implement to stay ahead of the changes.

To familiarise yourselves further with the proposed changes, have a look at the Localism Bill (section 171) and view the amendments against the Housing Act 2004 (sections 213 – 215 are relevant).