Claiming against a letting agent for introducing bad tenants

Here is a question to the blog clinic from Rimi who is a landlord.

I used a letting agent to introduce a tenant and his family in May 2015. The tenants were always late in paying and refused to communicate. When I asked them to leave, they stopped paying the rent and I eventually had to evict them.

I found out that they were using fraudulent names. When questioning the agents who had charged me £2000 + VAT for referencing I was sent two driving licences, one full GB and one provisional.

Their reference was given by their accountant (?) and had one tenant’s name spelt wrong and the letter was unsigned. The same accountant gave handwritten details of their income with no pay slips were given and no credit checks were done.

The company from which the reference came was checked and had accounts outstanding.

The day prior to the eviction date the tenants left owing £25k in rent arrears and furniture and fittings worth 20k were stolen from the property. They also trashed the property and 7 months later I am still redoing the house to make it suitable to rent out again.

Do I have a case against the letting agents for breach of the sales and services act for not acting in my interest and with due diligence when referencing the tenant?

I am an overseas landlady and cannot afford to come to UK so the police will not get involved as I need to be in the country to make a statement.

Answer

This is quite shocking and just goes to show what a poor job some agents do for their landlords.

I trust you are now using a different firm?

The first thing to do is to check your agency agreement (if you signed an agency agreement) to see what that says about their obligations towards you.

However notwithstanding that, as you rightly say, letting agents are bound by the Consumer Rights Act 2015 (which replaced the Supply and Services Act 1982) which provides that, if the supplier of services is acting in the course of a business, there will be an implied term that they “must perform the service with reasonable care and skill.”

So what sort of things are covered by this? A similar case from 2016 is reported here where the agents failed to follow up discrepancies in the information provided.

I think your case is comparable – as you say no credit checks were done and there appear to be discrepancies in the information provided which were not properly checked.

Incidentally, there is no need to involve the police for a civil claim.

Going to court

Your losses were considerably more than the lady in the case who obtained an award for some £8,000. From what you say it sounds as if you could have a good chance of obtaining judgement were you to go to court.

One problem though is that as you are resident abroad you would need to use solicitors, which could be expensive. Although you may be able to find a solicitor who is prepared to act on a no win no fee basis.

You would need to come to court to attend the hearing though. It is possible to give evidence via written statement if you are resident overseas but it may prejudice your case if you are not there.

Property Redress Schemes

Your other course of action could be to make a complaint to the agents’ Property Redress Scheme who have the power to make awards of up to £25,000.

In the Hale v. Blue Sky Property Group case, I referred to above, the landlord went to court as the Property Redress Scheme had rejected her claim. However, if you mention that case in your submission to the Property Redress Scheme they should take account of it and, in view of your losses, I would be surprised if an award was not made.

It will probably be less than you would get by taking the agents to court but you will not need to make a trip to the UK. If the result is unsatisfactory you can always take the agents to court later. You will have a period of six years to do this under the ‘limitation’ rules.