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Re-protection of AST deposit

Re-protection of AST deposit

Postby theycantdothat » Thu Dec 01, 2016 12:06 pm

In certain circumstances where a second or subsequent assured shorthold tenancy comes into existence the deposit may need re-protecting. If a letting agent is involved, is he negligent if he fails to advise the landlord of the need for re-protection?
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Re: Re-protection of AST deposit

Postby atticus » Thu Dec 01, 2016 12:13 pm

He may be.

This is fact-specific.
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Re: Re-protection of AST deposit

Postby theycantdothat » Sun Dec 04, 2016 9:16 pm

Let's suppose:

Agent is instructed to find tenant and informs landlord that the deposit needs protecting.

Six months later agent arranges new tenancy with same tenant and does not inform landlord that the deposit needs proetecting when it does.
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Re: Re-protection of AST deposit

Postby dls » Mon Dec 05, 2016 6:41 am

Atti is right.

The agent's client may be a landlord of a few dozen properties, with this his career.
He may be someone new to the trade with no business involvement or knowledge

The agent's terms may make all the difference.
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Re: Re-protection of AST deposit

Postby theycantdothat » Mon Dec 05, 2016 1:25 pm

Perhaps I need then to rephrase the question.

Assuming:

· the terms of engagement do not specifically exclude advice on protecting deposits;

· the question of protection has not been discussed;

· the agent has not established that the client is an experienced landlord;

then,

do the professional obligations of the agent include advising a landlord about protecting deposits?

If the answer is "no" but the above scenario applies, has the agent set a precedent by advising on the first occasion so that he also needs to advise on the second?
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Re: Re-protection of AST deposit

Postby atticus » Mon Dec 05, 2016 1:50 pm

As a lawyer advising from time to time on possible professional negligence cases I make it a rule not to say there has been negligence until I have seen all documents and have taken full instructions. Detailed investigation is always required to get to the bottom of the question of the full extent and nature of the duty of care, if any.

On the basis of your assumptions, you appear to be on the way towards establishing the duty for which you contend.

My answer to the 'precedent' question is "probably not".
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Re: Re-protection of AST deposit

Postby dls » Mon Dec 05, 2016 2:29 pm

If the answer is "no" but the above scenario applies, has the agent set a precedent by advising on the first occasion so that he also needs to advise on the second?

Does that not tend to suggest that the client landlord has been advised and will bear that advice in mind in future without being reminded? Again the reality is that each such situation has particular nuances which only come out in a thorough wash.
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Re: Re-protection of AST deposit

Postby theycantdothat » Tue Dec 06, 2016 11:02 am

dls wrote:Does that not tend to suggest that the client landlord has been advised and will bear that advice in mind in future without being reminded?


There is a difference between protection and re-protection since it is not obvious to the non-professional* that on a new tenancy he is deemed to have repaid the deposit and taken it again. If at the very outset the agent advises that the deposit needs protecting and needs to be re-protected whenever a new tenancy comes into existence and explains the circumstances in which a new tenancy comes into existence, he is in the clear.

It surely has to be the case that a letting agent needs to be fully clued up about deposits. If a landlord leaves the management of a property in the hands of an agent does he not have the right to assume that the agent will "do the necessary" and the necessary must include advising on deposit protection?

*Indeed it was not obvious to many professionals until they were enlightened by the Court of Appeal.
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Re: Re-protection of AST deposit

Postby atticus » Tue Dec 06, 2016 11:18 am

But if the money is still with the appropriate agency, isn't it protected, (or deemed re-protected)? Has it become unprotected?
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Re: Re-protection of AST deposit

Postby atticus » Tue Dec 06, 2016 12:10 pm

I question the assumption that a deposit needs to be re-protected where a tenancy is renewed. S215B Deregulation Act 2015 seems to cover the point.
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