The information and links on this page have been gathered from the various Government backed Deposit scheme websites and information pages.
What is a dispute?
When tenancies come to an end there are quite often disagreements over whether the landlord / agent retains the deposit held or the tenant recieves it back.
If the deposit is protected by one of the Govenment backed tenancy deposit schemes then the dispute can be referred to an Arbitrator and resolved by a professional, impartial adjudicator.
Current Government backed schemes are:
They will decide how much should be awarded to each party based on the evidence that you supply
Inventory & Check In Reports
Mid Term Reports
Check Out Reports
Photographic Proof – Before and After
Detailed descriptions, contracts and quotations for repairs etc.
Useful guides produced by TDS – Tenancy Deposit Scheme
Here are a few examples of real life cases involving Landlords, Agents and Tenants. The cover why the dispute occured, how it was handled and who claimed what and the outcomes of the cases. We have covered the main areas that come into dispute giving several cases as examples:
Wear and Tear – What is Fair?
A guide for Landlords & Agents
There are no precise rules on what is ‘reasonable wear and tear’. Below are some pointers from MyDeposits to help Landlords and Agents decide what is and what is not fair wear and tear.
Domestic tenancies must allow for reasonable wear and tear.
Unsuprisingly, there are no precise rules on what is ‘reasonably acceptable’. Is that carpet just well used or irretrievably stained? What about picture hooks left on the sitting room wall? Or the cooker that looks as if it has produced a good three meals a day, every day?
The House of Lords defines fair wear and tear as:
‘Reasonable use of the premises by the Tenant and the ordinary operation of natural forces’
Not exactly precise! When do ‘natural forces’ become ‘extremely heavy use’ or worse?
Below are some pointers from MyDeposits to help landlords decide what is fair and what is not. Clearly there are financial concequences when it comes to returning all or only part of a tenant’s deposit, so they should be viewed in the context of each particular tenancy.
LENGTH OF TENANCY
The longer the tenancy, the more natural wear. Common sense, but think, for example, how much wear a carpet in your own home shows after one, two or three years. Also consider what it’s condition was in the first place? Was it brand new or has it already seen a few tenancies come and go? Take account of all these factors.
NUMBER AND AGE OF OCCUPIERS
The more bedrooms and occupants, the higher the wear and tear in all the common parts – sitting room, passages, stairs, bathrooms and kitchen. If some of them are children, you have to factor that in too. Scuffs and scrapes are unavoidable in normal family life. A property occupied by a singleton will see far less wear than a family of four, so bear this in mind when it’s time for tenants to check out. There is an actual AIIC approved formula for this.
WEAR AND TEAR VERSUS ACTUAL DAMAGE
When is it no longer normal wear? If it’s in good condition at the start of the tenancy but broken at the end – meaning either replacement or repair by a specialist. Or if it’s possibly more than a conventional job painter and decorator? Light marks on the carpet might have to be viewed as unavoidable: fist marks in the plaster would not be. Equally, damage such as nail varnish spills on the floor or iron burns that have occured due to negligence could see the tenant liable for repair. Consider whether the item has been damaged or worn out through natural use versus sheer negligence when making a judgement call.
In a debate about whether cleaning / repair is necessary versus complete replacement at the end of the tenancy, an adjudicator will examine the Check-in / Check-out report, Statement of condition and any photos in order to make an assessment of the condition of the property in relation to the original condition.
QUALITY OF THE ACCOMMODATION
Another consideration is the quality or fabric of the property itself. Many new builds tend not to be quite as robust as older properties or conversions. Walls, partitions and internal painted surfaces tend to be thinner and therefore likely to suffer more stress, particularly in higher footfall areas of the property. This inevitably means that there is a greater need for redecoration at the end of the tenancy period.
There are a number of ways in which wear and tear can be kept to a minimum. Firstly, keeping your tenants happy; renewing their tenancies or allowing them to roll on to a Statutory Periodic Tenancy to reduce tenant turnover means that you will not be redecorating / renewing the property as frequently as you would for shorter tenancies.
Secondly, if tenants are in for longer periods of time, say two years plus, try to freshen up the property at regular interims. For example, you could change the carpet or paint a room. Strategic upgrades or enhancements of the property on a regular basis helps to maintain the standard of the property and reduces the need for refurbishment at the end of the tenancy period. Treating the property as an owner occupier would mean that you are ultimately minimising the wear and tear and need for redecoration when the tenant moves out.
Finally, set your expectatiojns of the tenants from the outset. Remind them that regular cleaning and maintenance can keep a property in good condition. Perhaps conduct a regular check every three months or so, particularly early on the tenancy, to check that everything is in order.
Photo inventories are a helpful means of recording the condition of the property pre and post the tenancy and should provide a clear record of the property prior to its occupation. Equally, being able to document and provide photographic evidence to support a claim against a tenant will help everyone know where they stand. Make sure all photographic evidence is clearly dated and signed by both parties.
For example, you should try to capture photos of burn marks / permanent carpet stains, damage to flooring, scratches / damage to woodwork, tears and rips in furniture. Photo evidence on their own may not be sufficient, so support this with a comprehensive, detailed inventory. If you are preparing the inventory yourself, rather than using an independent specialist, ensure that the tenant is provided a copy, both at the Check-in and Check-out stage, and signs a copy so that they understand, and have a chance to discuss with you, what deductions you are proposing to take from the deposit.
Ultimately, the higher the quality of your evidence you have the better, so keep inventory, photos, recipts and correspondence safe and ensure everything is signed and dated by both parties.
COMMON SENSE AND BEST PRACTICE
It is important to correctly describe the condition of items when listing the e.g. if something is down and ‘brand new’ it needs supporting bills / recipts to prove this.
THE ADJUDICATION PROCESS
Remember that the adjudication process in the event of a dispute, is independent and like a court of law, evidence based. An adjudicator cannot ‘assume’ and can only make a decision based on the evidence provided to them. You cannot challenge an adjudication decision unless it is via a Court of Law. The more evidence you produce and the more transparent you are with the tenant the higher your chance of success if a dispute is brought against you. MyDeposits cannot interfere or ‘review’ any decision made by the adjudicator and cannot tell you what evidence will be acceptable to the adjudicator and what will not.
Wear and tear is a topic that is open to interpretation. Ulitmately, as landlord, your aim is firstly to minimise the level of wear and tear in your properties and secondly to ensure that you have covered all bases in the unlikely event of a dispute with your tenant over the return of a deposit.
The above guide was produced by the Government backed MyDeposit Scheme – 12/09/2011
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