What are tenants rights when agreed refurbishment works are not done before the start of their tenancy?

Here is a question to the blog clinic fast track from Robin (not his real name) who is a tenant.

I moved into a rental property in London in October 2018.

The agents had advised that a 3-year fixed term tenancy with no break clause was the best option. I signed the tenancy agreement on condition that certain works be undertaken.

The start of the tenancy was pushed back to allow time for the work to be done. When I arrived at the property nothing had been done. If everything was not en route from outside London I would have returned the keys.

It was clear that numerous other significant works were required, and no EPC, Gas or Electric certificates, no inventory/check-in. Gas/EPC were emailed over the following Monday; the gas certificate was dated the same day, I questioned this; another certificate was emailed with an amended date conveniently for the day before I moved in.

I stated by telephone/email that the landlord was in breach of the terms of the contract and requested to be released; the landlord/Agent ignored this.

The Landlord suggested a two-week refurbishment during which time I would remain in the property and continue to pay rent.

She then gave ultimatum twice that if I wanted to be released from the agreement that I had until the end of the day to move out and remove my possessions.

I found another property to move to in December. The landlord demanded payment of rent until 31st December to release me from the tenancy agreement and return my deposit. I was negotiating this when the agents confirmed that new tenants were moving in on 15th December; the landlord maintained that I had to pay rent until 31st December.

Rent was already paid until 20th December. The landlord then said this was not rent, but a fee for her to release me.

I moved out on 10th December, after which refurbishment work began, lasting until new tenants moved in. I then requested return of my £3,180 deposit. The landlord made a claim for the rent and for £10,361.42 of agency commission. I have until 16th March to raise a dispute with DPS. I am unsure how best to proceed.

Answer

Your landlord is behaving outrageously! She is the one in breach of contract, not you.

Your claim

Before doing anything you need to check over the terms of your contract. Your precise rights will also depend on the terms you may have agreed when moving out.

However in my view you are entitled to the return of your deposit and also to compensation from the landlord for breach of contract as the property you lived in for those weeks was not the property you contracted to rent – as the agreed works had not been done.

If the place you are moving to is more expensive than this property then you may even be entitled to an award for the difference in the rent for the duration of the 3-year term – although this will depend on the precise facts and what was agreed when you moved out.

The tenancy will probably have ended when the landlord started doing works after you had moved out. It will definitely have ended when the new tenants moved in – and no rent can be due from you from that date.

Note by the way that had you taken action during the first month of the tenancy you would have been entitled to ‘unwind’ the tenancy and get all your money back Under the Consumer Protection (Amendment) Regulations 2014,

The landlord’s claim

Your landlord is not in a strong position as she is the one in breach of contract. Had she done the agreed works you would not have wanted to move out in the first place.

She cannot claim any rent from you after your tenancy ended. As stated above this will definitely be when the new tenants moved in and arguably when works started at the property.

I regard her demand that you refund her agency fees as totally outrageous. It is to make it clear to all that this type of thing is unacceptable that we now have the Tenant Fees Act 2019 (due to come into force on 1 June).

It may sometimes be allowable for a landlord to make payment of (modest) agents fees for finding a new tenant a condition of agreeing to end the tenancy early. But I can’t see how this can apply in your circumstances. The only reason you wanted to move was her breach of contract.

I don’t see how she can be entitled to a fee for ending the tenancy early when it is being ended due to her breach of contract.

What you should do

If you decide to go down the route of a DPS adjudication I think you should get your deposit back. Incidentally, you don’t say whether the agent served the prescribed information on you – I assume they did.

However, you may be better threatening to bring a claim in the Small Claims Court. Then you would be able to claim for:

• The return of your deposit
• Compensation for your landlord’s breach of contract, and (if your current property is more expensive
• An award to compensate you for having to move to a more expensive property ie the difference in rent for the remainder of the term

These last two are not things the DPS adjudicator will be able to deal with as the adjudication schemes are only able to deal with deposit issues. So tenant claims will be disregarded by them.

However, before bringing any claim you should get some legal advice from solicitors who do housing work (not all firms do).

Incidentally, you can’t bring a court claim against the agents, but you could consider bringing a complaint and claim for compensation to their Property Redress Scheme. For example for misleading you about the repair work which was not done before you moved in.

Note to landlords reading this

I regard this landlord’s behaviour as unacceptable. However, by agreeing with the agents to a three-year term she will have lost the agency commission (£10,361.42) for the whole three years as this will no doubt will have been taken up front by the agents from the tenants first rental payment.

The agents will then no doubt have taken a second commission for finding the second tenants.

This is one reason why landlords should NEVER allow letting agents to persuade them into signing up for a long fixed term with new tenants. Always have a shorter ‘trial’ tenancy first.  Just in case things go wrong.

The main reason why agents encourage long fixed terms is for the agency commission.