Tenancy deposit arbitrations - why landlords keep losing

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.

Reading through the excellent 'Landlord & Buy-to-Let Magazine' today (September/October 2009 issue), I particularly enjoyed reading the landlords diary at the back by Barry Brunton. This gave some interesting background information on tenancy deposit arbitration's, which I thought I would share with you.

I was especially interested as a number of readers of this blog have posted their complaints about too tenant friendly arbitrators, for example here. In the context of this, Barrys article is quite enlightening.

He makes the point first that the tenancy deposit belongs to the tenant, and the landlord, if he wants to make deductions, is making a claim which he will have to prove by evidence. And if you do not provide this, you will lose your claim, the arbitrator is unlikely to write and ask you for it. For example:

• Inventories - these need to be a detailed condition report on the property not just a list of the furniture in it. To make a claim for damage to furniture (for example) you are going to have to prove that it was in good condition at the start of the tenancy. It is best that this is done by an independent firm of inventory clerks
  
• You will also need a check out report, again this should be done by the independent inventory clerks
  
• Photos are generally of no value as they could be of anywhere. Presumably if they are signed by the tenant and inventory clerk on the reverse and dated they should be acceptable. If used they should be clear and have something (such as a ruler) to show scale.

Barry then explains how an adjudicator would approach a claim for a damaged carpet.

• He would want to know the condition of the carpet both at the start and at the end of the tenancy
  
• Evidence of when it was purchased
  
• The cost of replacement
  
• And the normal life of such a carpet
  
• He would consider whether it could instead have been cleaned
  
• Or whether any stain is relatively insignificant and can be left
  
• In his award he will consider fair wear and tear
  
• And base his award on the cost of replacement carpet but not underlay
  
• For a ruined 3 year old carpet, the landlord (he says) will be lucky to get 40%, even if he can prove everything, as a tenants deposit is not a 'new for old' insurance policy

This is a bit different from in the old days, when the landlord would just deduct the cost of a new carpet leaving the tenants to sue him at the county court if they disagreed.

It seems that adjudicators also expect landlords to post notices explaining how things work and will accept a tenants excuse that he did not know (and therefore is not responsible for damage through misuse) even if the landlord has provided manuals. For example in one case, a tenant ruined a lawnmower by not putting oil in, but he successfully argued that he should not be held responsible as there was no 'check oil before use' notice on the mower, even though this was set out the manual he had been given.

I am beginning to see why landlords are often so incensed at arbitration results. I agree that the landlord should have to prove his case, but this seems a bit too much. I wonder whether a Judge in a County Court case would have come to the same decision.

Have you any stories to tell? If so please post a comment.

In the next issue, Barry is going to talk about adjudicators dealings with claims relating to gardening, condensation and tenants changing. Order your free copy now.