Small Claims Court Q's - Letting Agency (I am the agent)

[zcacogp]

Chaps,

I have a situation which I hope won't come about too often, but which needs to be handled correctly. I'm a letting agent, and an (ex-)tenant who has left damage to a flat they moved out of. Their deposit was correctly lodged with the Deposit Protection Service and we have failed to come to an agreement as to what a reasonable deduction should be. (The costs for cleaning and damage repair came to just shy of £1500 and they have offered £300, with no explanation of how they came to this figure.)

The DPS have a Dispute Resolution Service but the landlord has asked (and I agree) that we should go to the Small Claims Court to resolve the problem. And therein lies the question; who should take the tenants to court? The landlord or me (/my company)? The AST is between the landlord and the tenant, and I am listed on the AST as an agent. However I have signed the AST on behalf of the landlord, and have had all the contact with the tenant to date. I am guessing that it should therefore be the landlord who takes the tenant to court - is this correct?

Next Q is how to make this happen? Am I allowed to apply to the Small Claims Court on behalf of the landlord to start proceedings, or should this be done by the landlord? Does the landlord have to be present at the hearing or can I handle everything for them, as I have done thus far?

If it comes to a hearing where we go to the court to present our cases, would I be allowed to go on behalf of the landlord? Ideally I would, but the landlord lives in Wigan and I (and the ex-tenant) are both in London.

All advice welcomed, thanks.


Oli.

[gsr121]

If you were my agent, and I was paying you x% of the the monthly rent, I would expect you take advice from a qualified property lawyer, not seek advice from a motoring forum.

G.

[zcacogp]

Good point. I have consulted a property lawyer who is getting back to me with an answer, but I thought I would ask here as well as there are legally-qualified people around.

If you know of another property lawyer then I am quite happy to hear recommendations.


Oli.

[gsr121]

You could ask the question on the forum linked below. I believe there are qualified people on there (but will accept no liability for any advice given). Ultimately I would rely on paid for legal opinion only.

http://www.landlordzone.co.uk/forums/forumdisplay....

G.

[zcacogp]

GSR,

Thanks again. Yes, landlordzone is a great forum and I post there occasionally - and it will be my next step should I not receive advice here. I tend to go for PH first out of habit, nothing more than that.


Oli.

[Wings]

As a landlord I now recognise that due to changes in the civil procedures, Landlords & Tenants Claims can no longer be dealt with under the small claims track, the same making the procedures more complex and very costly to get a case into court. Whilst a landlord may implement legal proceedings, I understand the Solicitors Act prevents an agent with no legal training acting for a landlord in starting legal proceedings.

I believe one would be best advise to either go down the ADR route, or to employ a legally qualified person to process the legal papers.

[JustinP1]

Why not just use the DPS arbitration?

If this gets to court, the Judge will likely ask this. What's the point in giving tenants protection of their deposit and a third party to arbitrate claims without the court if landlords don't use it?

[zcacogp]

Wings said:

As a landlord I now recognise that due to changes in the civil procedures, Landlords & Tenants Claims can no longer be dealt with under the small claims track, the same making the procedures more complex and very costly to get a case into court. Whilst a landlord may implement legal proceedings, I understand the Solicitors Act prevents an agent with no legal training acting for a landlord in starting legal proceedings.

I believe one would be best advise to either go down the ADR route, or to employ a legally qualified person to process the legal papers.

Wings, thanks, your advice is usually worth listening to and I'm grateful. I didn't know this and it's helpful to have it pointed out.

JustinP1 said:

Why not just use the DPS arbitration?

If this gets to court, the Judge will likely ask this. What's the point in giving tenants protection of their deposit and a third party to arbitrate claims without the court if landlords don't use it?

DPS arbitration is not known for being consistent and reliable and can produce some arbitrary results. As I understood it (prior to reading Wing's post above), there is no obligation to use the DPS resolution process and Small Claims Court is an option. Indeed, the DPS themselves say that their resolution process is not obligatory and that going via the Small Claims Court is an option.

Thanks for your input chaps.


Oli.

[agtlaw]

zcacogp said:

Chaps,

I have a situation which I hope won't come about too often, but which needs to be handled correctly. I'm a letting agent, and an (ex-)tenant who has left damage to a flat they moved out of. Their deposit was correctly lodged with the Deposit Protection Service and we have failed to come to an agreement as to what a reasonable deduction should be. (The costs for cleaning and damage repair came to just shy of £1500 and they have offered £300, with no explanation of how they came to this figure.)

The DPS have a Dispute Resolution Service but the landlord has asked (and I agree) that we should go to the Small Claims Court to resolve the problem. And therein lies the question; who should take the tenants to court? The landlord or me (/my company)? The AST is between the landlord and the tenant, and I am listed on the AST as an agent. However I have signed the AST on behalf of the landlord, and have had all the contact with the tenant to date. I am guessing that it should therefore be the landlord who takes the tenant to court - is this correct?

Next Q is how to make this happen? Am I allowed to apply to the Small Claims Court on behalf of the landlord to start proceedings, or should this be done by the landlord? Does the landlord have to be present at the hearing or can I handle everything for them, as I have done thus far?

If it comes to a hearing where we go to the court to present our cases, would I be allowed to go on behalf of the landlord? Ideally I would, but the landlord lives in Wigan and I (and the ex-tenant) are both in London.

All advice welcomed, thanks.


Oli.

The landlord is the claimant. The tenant is the defendant. Be very careful issuing proceedings - conducting litigation if you're not a solicitor / authorised barrister is a criminal offence. I note that you signed something on behalf of the landlord. If you similarly signed the claim form then you'd be in trouble. Get professional help.

[zcacogp]

agtlaw said:

The landlord is the claimant. The tenant is the defendant. Be very careful issuing proceedings - conducting litigation if you're not a solicitor / authorised barrister is a criminal offence. I note that you signed something on behalf of the landlord. If you similarly signed the claim form then you'd be in trouble. Get professional help.

Very sound advice. Thank you.


Oli.

[CYMR0]

agtlaw said:

conducting litigation if you're not a solicitor / authorised barrister is a criminal offence

Not that this is wrong, but isn't the offence in providing legal representation rather than acting as an agent for the landlord, effectively appearing as a litigant in person as part of the agency duties?

[allergictocheese]

Whether the letting agent can issue proceedings in their own name will depend on their contractual relationship with the parties.

If, as said above, it cant be conducted on the small claims track then I'd seriously consider whether the risk of litigation is worth it, especially considering there is arbitration available and the amount concerned is relatively small.

[agtlaw]

CYMR0 said:

Not that this is wrong, but isn't the offence in providing legal representation rather than acting as an agent for the landlord, effectively appearing as a litigant in person as part of the agency duties?

Signing a claim form o.b.o. the claimant would be conducting litigation. That's a criminal offence if you're not legally qualified and authorised.

Appearing in court is a separate criminal offence if you don't have rights of audience in a court which requires this. There's a strange creature called a McKenzie Friend but that probably doesn't apply here. Litigant in person means exactly that. The clue is in the words "in person".

I used to be authorised to conduct litigation but since 'converting' I no longer have this authorisation and consequently must get clients to personally sign and serve plea forms / claim forms / notices when I don't have an instructing solicitor.

Edited by agtlaw on Wednesday 4th February 23:30

[Wings]

agtlaw said:

Signing a claim form o.b.o. the claimant would be conducting litigation. That's a criminal offence if you're not legally qualified and authorised.

Appearing in court is a separate criminal offence if you don't have rights of audience in a court which requires this. There's a strange creature called a McKenzie Friend but that probably doesn't apply here. Litigant in person means exactly that. The clue is in the words "in person".

I used to be authorised to conduct litigation but since i 'converted' i no longer have this authorisation and consequently i must to get clients to personally sign plea forms / claim forms / notices where i don't have an instructing solicitor.

If a landlord were to sign the legal papers, could the same then authorise either an agent, relative or friend to represent the landlord in court, or would there need to be a "Mckenzie Friend" request to the court?, thanks

[jbsportstech]

How much is the deposit? less than the £1500 claimed.

I was threatened by previous agent/landlord for pin dent in fridge. I offered £75 which was rejected LL wanted a new fridge as it was new 2 years ago or he would settle for £207 indesit quoted to replace the door. I asked for a restrictor as the kitchen door opened on the over sized fridge but this was rejected by the landlord at the start of tenancy.

I was told he would not entertain DPS mediation and would commence legal proceedings and wanting to stay on good terms with agent i offered £200 in the end that was accepted. Of course LL pocketed this and did nothing about the fridge and re-let the house.

I would offer the tenant the bare minimum of what it actually cost for the works with full breakdown and and state you are waiving any charges you may have added to cover you admin etc. Say this is a true cost and final chance to settle with DPS and potential legal action and state your client/LL is pressing for legal action and wants to engage a solicitor and go for the full £1500 and legal fees. Do you have independent inventory report pre and post let?

i think you need to engage DPS Mediation as this will show you have tried to work the matter out and legal action is a last resort.

[jbsportstech]

How much is the deposit? less than the £1500 claimed.

I was threatened by previous agent/landlord for pin dent in fridge. I offered £75 which was rejected LL wanted a new fridge as it was new 2 years ago or he would settle for £207 indesit quoted to replace the door. I asked for a restrictor as the kitchen door opened on the over sized fridge but this was rejected by the landlord at the start of tenancy.

I was told he would not entertain DPS mediation and would commence legal proceedings and wanting to stay on good terms with agent i offered £200 in the end that was accepted. Of course LL pocketed this and did nothing about the fridge and re-let the house.

I would offer the tenant the bare minimum of what it actually cost for the works with full breakdown and and state you are waiving any charges you may have added to cover you admin etc. Say this is a true cost and final chance to settle with DPS and potential legal action and state your client/LL is pressing for legal action and wants to engage a solicitor and go for the full £1500 and legal fees. Do you have independent inventory report pre and post let?

i think you need to engage DPS Mediation as this will show you have tried to work the matter out and legal action is a last resort.

[agtlaw]

Wings said:

If a landlord were to sign the legal papers, could the same then authorise either an agent, relative or friend to represent the landlord in court,

or would there need to be a "Mckenzie Friend" request to the court?, thanks

Unless the judge allowed it (extremely unlikely) then no.

"What McKenzie Friends may not do
4) MFs may not: i) act as the litigants’ agent in relation to the proceedings; ii) manage litigants’ cases outside court, for example by signing court documents; or iii) address the court, make oral submissions or examine witnesses." Master of the Rolls, Practice Direction 2010

[JustinP1]

zcacogp said:

DPS arbitration is not known for being consistent and reliable and can produce some arbitrary results.

Thanks for your input chaps.

County Court, especially at the small claims level, is often staffed by Deputy District Judges, who are part timers, and can be moonlighting solicitors.

I'm not a solicitor, and only part of my degree was in law but last time I was there I had to find a way to very politely correct a DDJs interpretation of the law. Luckily, the law was on my side, and he was able to reference what I stated in The While Book on the desk, and he had to force a wry grin as he entirely reversed his decision.

I think before proceeding with an legal action, the advice of a solicitor is a necessity.

While clearly you want to help, there is a fine line between assisting and making yourself liable for the pitfalls of the legal system, and your own liability.

The reality of the small claim track is that it is the least time consuming of court processes, but, in order to mount a successful claim and to file the correct paperwork, evidence and Particulars you are talking about house of work.

It may be that the defendant folds straight away. But, if they have a bit of nous, they will understand it is in the best interests to defend. The additional costs for doing so are relatively small in comparison to the amount claimed, and they would only be liable for these should the claimant really go all the way to a hearing, and win.

If I thought you were taking the p*ss for example, I'd defend your claim as a matter of course, as I could save myself a grand or more.

That means taking someone to court needs to be a commercial decision. I'm a landlord myself, and been left with damages. Luckily they were covered by the deposit. If it were the case though that after the deposit I was only a few hundred quid out of pocket, whilst I would take a punt and threaten legal action, for that kind of sum, it is better written off. Not only in terms of saving time, but of course the loss is tax deductible if nothing else...

[superlightr]

JustinP1 said:

While clearly you want to help, there is a fine line between assisting and making yourself liable for the pitfalls of the legal system, and your own liability.

The reality of the small claim track is that it is the least time consuming of court processes, but, in order to mount a successful claim and to file the correct paperwork, evidence and Particulars you are talking about house of work.

I qualified as a solicitor a long time ago and now run/own my letting agency business. I would not start court action/fill the forms in on behalf of a client as im no longer practising as a solicitor and also Im not getting paid to do so.

So we recommend a firm of solicitors if legal action needs to be started. If the legal process goes wrong then its not on my head. We can gather the evidence for the LL/sol to bring the claim but its upto the sol to get the legal paperwork right. As others have said commercial view has to be taken in relation to some deposit claims no matter how galling.

just as a side note, law of agency etc, I know you can but we never sign an AST for a landlord, we always get them to to do so. Another level of protection for us.

Dispute service - there is no incentive for the tenant not to dispute. So much red tape now for letting agents - unbelievable, Immigration checks next - criminal offence if you get it wrong. Greaaat.

Edited by superlightr on Thursday 5th February 14:48