The Colourful World of Deposit Disputes

LONDON, September 14, 2011 -

- TDS Lifts the Curtain

From smashed antique vases to missing washing machines, the Tenancy Deposit Scheme, TDS, has heard it all and this month has published some of the stories behind deposit disputes in a new set of case studies. These are to show how independent adjudicators approach a deposit dispute when landlords and tenants cannot reach an amicable agreement between themselves. It is part of a continuing campaign to make deposit resolution open and easy to understand.

This latest set of examples also cover redecoration problems at the end of a tenancy, from the need to prove that “premium” paint was used in one property to a case of betterment, where the tenant had done a better decorating job than the landlord.

Guidance notes point out that a deposit cannot be treated like a new for old insurance policy. If landlords could replace items like that, it would amount to being betterment at the tenants’ expense, which adjudicators do not regard as reasonable. With the same principle in mind, the replacement cost for missing items usually would be based on their second hand value at the end of a tenancy.

The guidance notes also point out that allowances must be made for fair wear and tear. The length of a tenancy and the age of the missing or damaged item need to be considered as do its quality, condition and reasonable life expectancy at the beginning of the tenancy. This emphasises the need for a good condition report at the outset.

The importance of this is also underlined when considering redecoration. A comprehensive inventory and schedule of condition will describe the condition of the décor, whether it is newly done or if there are existing defects. TDS guidance notes stress that an adjudicator cannot simply assume that a property was in good condition at the outset.

The publication of these guidance notes and case histories follows consultation with the Members’ Forum of the Tenancy Deposit Scheme as well incorporating the views sought from consumer organisations such as the National Union of Students, NACAB and Shelter.  These consultations helped to identify and explain the causes and likely solutions to deposit disputes with the widest possible audience in mind.

“Although disputes cannot always be avoided, by publishing the experience we have gained, we can help landlords and tenants and their letting agents to find an amicable solution without going through the process of Alternative Dispute Resolution,” said Steve Harriott, Chief Executive of the Tenancy Deposit Scheme.

Case studies and explanations about the adjudication process already published by the Tenancy Deposit Scheme include the most common of all disputes, cleaning. There is also a monthly Adjudication Digest. The full anonyomised studies and the guidance notes to go with them can be found on www.tds.gb.com in both the Landlords and Tenants sections.

Media Contact: Malcolm Harrison, +44(0)20-7581-8335