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Question Title: Deposits - stakeholder or agent for the landlord?
| Question: 366 |
| At present our tenancy agreements are silent as to whether we hold the deposit as stakeholder or agent for the landlord. To date we haven't had any problems but we are not sure of the legal position. Should we do anything to make the position any clearer for the future?
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| Answer: |
| In the absence of any agreement, the letting agent will continue to hold the deposit money in trust for the tenant, after all until there is any breach of the terms of the tenancy agreement it remains the tenant's money. If there is a dispute over the deposit, for example the landlord has demanded deductions from the deposit for payment of damage, rent arrears or other breach of the tenancy agreement then the agent is obliged to follow the landlord's instructions. So where the agreement is silent then the agent will remain 'agent for the landlord'. As the government has added new provisions regarding deposits to the Housing Bill presently going through Parliament it would probably not be worth making any changes at this stage until we see what is proposed. It is likely that there will be a statutory scheme in addition to approved schemes established by a number of trade bodies. We will keep readers up to date with developments.
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References:
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Pages:
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Hyperlinks:
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Letting Update Journal |
Apr 2002 page 18 |
letting-update-journal.html
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Letting Handbook |
Chapter 10 |
letting-handbook-and-factsheets.html
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For more information, discuss on the Forum
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