Matthew Sampson, Adjudication Manager at the Tenancy Deposit Scheme, the only not-for-profit tenancy deposit protection scheme, discusses a dispute where tenant changeovers impacted both the cleaning and rent arrears sections of the claim.
The dispute
Regardless of whether you’re renting to students, housemates, or a married couple, a tenant changeover or early termination can have repercussions—particularly when it comes to potential deposit disputes. This month, we’re exploring an Insured deposit protection scheme case where claims for both cleaning and rent arrears were impacted by tenant changeovers.
In this case, the landlord rented the property to three students and was claiming for cleaning required to return the property to the standard documented at the start of the tenancy. Supporting evidence included a tenancy agreement with a well-worded deposit use clause, an original inventory, a check-out report, and an invoice for the cleaning.
The evidence and the outcome
The adjudicator reviewed the evidence submitted to the deposit protection scheme.Upon review of the evidence, the adjudicator noted that the original inventory was dated a month before the tenancy started. While the check-in report had been signed by the original three tenants, at the end of the tenancy, two of the three tenants differed from those named in the tenancy agreement. It emerged that a tenant changeover had occurred—two tenants had moved out and provided replacements. A new tenancy agreement was created, and the deposit protection scheme paperwork was updated
Without evidence that the new tenants were provided with a copy of the original inventory or a clause within the new tenancy agreement in which the new tenants were bound by the terms of the original inventory, the landlord’s claim is compromised.
In this case, however, there was a provision in the new tenancy agreement that referred to the original inventory and its date, and the clause clearly explained that the new tenants would be bound by its contents. The evidence also showed that the tenants referenced the original inventory in their deposit submission and provided extracts and photographs from this document, accepting it as a valid record of the property’s condition at the start of the initial tenancy. The adjudicator was able therefore to accept the inventory and made an appropriate award for cleaning costs.
The second part of the dispute involved a claim for rent arrears. The tenants sought to vacate the property two months early and vacated early. The new tenancy agreement did not however contain a break clause; the landlord, therefore, claimed for two months of unpaid rent up to and including the end of the new tenancy agreement fixed term. The landlord provided a rent statement showing the amount claimed as outstanding.
While the tenants agreed to pay one month’s rent, they contested the second month, asserting that a new tenancy had already commenced at the start of the second month. The tenants substantiated their claim by providing a copy of the newly signed tenancy agreement, as they personally knew the new occupants. This evidence demonstrated that the landlord had not suffered a financial loss for the second month, leading the adjudicator to award only one month’s rent based on the provided evidence.
The role of a deposit protection scheme
Using a deposit protection scheme, such as the Tenancy Deposit Scheme, ensures disputes like these are resolved fairly. These schemes safeguard deposits and rely on clear evidence, protecting both landlords and tenants. The adjudicator’s impartiality ensures decisions are based solely on the evidence provided, aligning with the standards of a deposit protection scheme.
So, what are the key points here?
- It is crucial that clear documentation is provided and signed during tenant changeovers. When tenants change mid-tenancy, updating the inventory and ensuring all new tenants have reviewed and agreed to it must be made a priority; the most practical way of doing this is by providing an addendum to the tenancy agreement to be signed by the parties or a clause within the tenancy agreement itself. Lack of evidence showing the new tenants’ acknowledgment of the original inventory can weaken claims during disputes and often results in no deductions being awarded. For further information please see our change of sharers guide here
- It is worth nothing that this scenario would have differed had it been the case that one tenant had simply left, and the tenancy agreement and administration was updated to reflect this change. The remaining two tenants would still have been held to the original inventory without the requirement for a signed addendum, or re-acknowledgement of this document.
- To successfully claim unpaid rent, landlords must demonstrate an actual loss (e.g., vacancy during the disputed period). It is not possible for a landlord to claim rent twice in these circumstances. If tenants can show the property was in fact re-let within the period rent is being claimed, it can impact the landlord’s claim.
By following these tips and using a trusted deposit protection scheme like the Tenancy Deposit Scheme, landlords and letting agents can avoid common pitfalls during tenant changeovers and ensure disputes are resolved efficiently and fairly.
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