At Asher Prior Bates Solicitors in Colchester, Essex our specialist property team are often asked by landlords and tenants “what happens to the deposit when renting?”

From 6 April, 2007, new Regulations made under the provisions of Housing Act 2004 required every landlord or letting agent that takes a “deposit for an Assured Shorthold Tenancy (AST) in England and Wales” to  join a Government approved Tenancy Deposit scheme and ensure that the Deposit taken is protected as the scheme prescribes.

The Landlord or Agent then has 14 days from receipt of Deposit to provide the tenant with details of the scheme that they are using.

Landlords are now losing dispute resolution Arbitration and Court cases because they are failing to take good inventories of the state and condition of both the property and its fixtures furnishings and fittings, where upon termination, tenants complain about the non-return of the deposit.

Both parties should ensure they have all the right paperwork to present to the Court. Cases will be lost where parties fail to provide proper evidence to show the extent of damage to the property. In law the deposit remains the property of the tenant until/if there is a dispute, the landlord can prove justification for any deductions and this is approved by the adjudicator or the Court.

Most landlord inventories will fail to stand up in these proceedings if they are not thorough and detailed – allowing both parties to be treated fairly and reasonably. The Inventory serves a number of vital functions, including providing a catalogue of the let property and a record of the condition. It must be a comprehensive and a clear record of the property’s condition and backed up by reports on commencement and termination.

If correctly drawn it will form an enforceable part of the AST.  It is vital to have a carefully prepared inventory at commencement, which can be then used at termination, to enable an accurate evaluation of the property’s condition to be made. Ideally it should be supported by a full catalogue of photographs, and the inventory agreed by and signed by the incoming Tenant to confirm it as a correct record as at that time.

…and finally, Landlords, in the unhappy event of the Tenant leaving your property in a mess, must remember to collect and retain all invoices to support costs claimed for repairs!

There is now available to help an Association of Independent Inventory Clerks (AIIC).   If you are looking for advice and you are based in the Colchester area, please see local AIIC member Specialist Inventory Services  and contact Nicholas Barwick or Tara Hodgson on 07900 963 133 or email tarahodgson@btinternet.com

For help and advice concerning both the preparation and enforcement of Assured Shorthold Tenancy please contact Michael Hicks(mhicks@apblaw.co.uk) or Roger Buston (rbuston@apblaw.co.uk) or call 01206 768 331 and we will be happy to offer you a free 20 minute consultation before taking matters forward.