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All tenancy deposit adjudicators are biased against landlords – discuss

2007 – a new  dawn for tenancy deposit disputes

When the new tenancy deposit schemes were ushered in, one of the benefits trumpeted was that they would have a free, quick and easy arbitration (or adjudication) scheme to deal with disputes over deposits.

No more long waits for landlords and tenants while cases slowly made their way through our crumbling county court system. Turnaround times of 10 days were promised, and indeed decisions are much, much quicker than in the courts.

Chances of winning deposit disputes

However when a decision is made, one party is always going to be unhappy about it. And with tenancy deposit adjudications, the overwhelming number of unhappy ones are the landlords.

The number of outright landlord wins in the pie chart above has been criticised by DPS who say that their figures show the split ito be is 18% to landlords, 37% to tenants, 45% split awards

However even if you take the DPS figures as the right ones, that is still a massive 82% of landlords who don’t get the decision they want.

Are adjudicators biased?

Horror stories abound about how landlords, faced with trashed properties costing thousands of pounds to put right, have put in a claim for the deposit, only to have the adjudicator award all the money to the tenant.

How can this be? “They are all prejudiced against us” is the inevitable reaction from outraged landlords faced will crippling repair bills while tenants waltz off into the sunset, never to be found again.

This accusation is even made against My Deposits – an organisation specifically set up for landlords by the National Landlords Association! Surely THEY can’t be predudiced against landlords?

So whats the answer?

The reason why so many landlords lose is not a simple one. Its a combination of:

  • Landlords being used (ie pre scheme) to just deducting what they want without challenge, save in the few cases where tenants have braved the courts (where on the whole the tenants have won)
  • Landlords not realising that the deposit is the tenants money – which means that THEY are the ones who have to prove their case, not the tenants
  • Landlords not understanding the basis on which the adjudicators make their decision (i.e. on the evidence)
  • Landlords failing to take proper steps at the start of the tenancy to create a detailed and unchallengeable inventory – the foundation stone of all successful landlord claims

Although it is a ‘quick and straightforward’ system, tenancy deposit adjudications are still legal decisions. Most of the adjudicators are lawyers (the rest are generally surveyors).

Landlords need to present cases properly

So if landlords want to succeed, they need to present their case to the adjudicator the proper way. But most of them don’t know how to do this.

“What they need”, I have been saying to myself for a while, “is a clear strightforward guide, telling them in simple language, what they need to do”.

An answer appears!

So when Tom Derrett sent me the draft of his new book ‘How to win deposit disputes’ I was bowled over. “This” I said “is just the job! Its what the landlord market has been waiting for”.

I was so impressed that I asked Tom if we could publish the book for him via my ecommerce business ‘Your Law Store’.  I was thrilled when he said ‘yes’.

Tom is an ideal person to write this book:

  • He is a former adjudicator, so he knows how they think
  • He has a business helping landlords prepare their case for adjudication so he knows the problems that arise
  • He can write in a clear and easy to understand style – not something every lawyer can do!

The book is almost ready to go and we are doing the last few tweaks. Tom has written a new conclusion which needs to be added in, and we are doing the final work getting it ready to launch.

I’ll let you know when its available.

But in the meantime, this week on the blog I am going to be concentrating on tenancy deposits. There is also going to be some stuff from Tom and we are preparing a video interview which will be put online later this week.

How to win deposit disputesSubsequent note :

Tom’s book is now out, and available from  >> this page so please go and take a look.

You will be able to download the first two chapters of the book to see if you like it.



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20 Responses to All tenancy deposit adjudicators are biased against landlords – discuss

  1. How many of these adjudicators have been or are landlords? I would hazard a guess at very few. On the other hand, how many of these adjudicators have been tenants on the receiving end of a bad landlord? I would hazard a guess at quite a few. One might say there may be a few adjudicators out their with an axe to grind.

  2. But isn’t the proof in the pudding? As you state ‘82% of landlords don’t get the decision they want.’ These landlords would not enter into adjudication unless they truly believed they were in the right.

  3. They may believe they are right, they may even BE in the right. However if they do not provide the adjudicator with the proper proof of their claim he cannot find in their favour – even if privately he would like to.

    Tenants start from a very strong position – its their money. They don’t have to prove anything. The landlord does.

    The fact that someone believes something is not sufficient proof in a court of law. And adjudication is a judicial process, albeit a fairly basic one.

    This is why landlords need help – they don’t appreciate what they need to do to suceed at adjudication.

  4. Two main reasons why landlords lose are:

    1) burden of proof is on the landlord and they lack the evidence, 2) landlords have unreasonable expectations after years of deposit abuse.

    If you manage expectations from the outset and have good evidedence it rarely goes to dispute – as an agent we’ve had one dispute since the legislation was introduced (the landlord won).

    David Smith (formerly of Painsmith) has written a comprehensive guide to the TDS, conveniently named ‘ A Guide To The Tenancy Deposit Scheme’. Hardcopy is published by the TDS and will be available on their website shortly.

    To be honest I’m surprised the topic is big enough to warrant a book.

  5. You are absolutely correct Jamie. If things are done properly they should not go to arbitration.

    I have seen Davids book which is good (as you would expect from David) but perhaps a bit technical for the average ‘Daily Mail’ type reader.

    Tom’s book is not a long one, but I don’t think you should judge a book by how long it is. You can have pages and pages of text which effectively tell you nothing, and one page which can save you thousands because it gives you the key to doing whatever it is the book is about.

    A landlord who has Tom’s book will be given the key to winning tenancy deposit disputes. Provided they follow the advice that is!

  6. it’s not about winning is it?

    It’s about the correct decision being made.

    I’ve never been a landlord,but i’ve been a tenant to plenty a landlord who just expect to take whatever they want from the deposit.

    The last time this happened i took them to tenancy deposit adjudication and won the and got the whole of my deposit back……the reason? Well the landlord’s agent couldn’t be bothered to lodge any evidence….instead they tried to circumvent the system by just paying us the deposit (with the amount they wanted deducted) when we started the adjudication process.

  7. Impartiality is integral to an adjudicator’s professional integrity so the accusations of bias (both from landlords and tenants)are something we are highly conscious of and keen to challenge. I’m from TDS and it’s old as the scheme. Jamie and Tessa have summed up well how this perception is usually unjustified and stems from landlords not appreciating that the deposit is the tenant’s money, and it is the landlord’s responsibility to prove a deduction they make is justifiable.

    The main problem is inadequate evidence from the landlord, which I assume is the focus of Tom’s book (I look forward to reading it).

    Now that TDP is almost 5 years old it appears that awareness amongst agents and landlords is improving, as we are seeing a gradual increase in proportion of deposits going to them. There is still a lot more to do though, and education for agents and landlords is a permanent ongoing process here; training courses, case studies, adjudication digests etc.

    Jamie – I think it warrants a book because the real issue is not necessarily adjudication itself or the protection of deposits, but preventing disputes in the first place. If you have strong evidence it will be harder for a tenant to question deductions before a dispute is needed. This requires processes in place to prepare the landlord for every eventuality for every tenancy, so it’s quite a broad subject! Very much looking forward to what Tom has to say on it.

    Tom is also correct to point out it is not about “winning”. This is simplistic as the amount can be allocated in any proportion between the parties. If you look at our stats we analyse total cases which have gone 100% either way, and percentage allocation of the total number of disputes which we have adjudicated. (See the statistical digest http://www.tds.gb.com/resources/files/Adjudication-Statistical-Diges-20December-202011.pdf .)

    Also the above chart is a little misleading in saying the landlord “loses everything” – as we are trying to help landlords to understand, the deposit belongs to the tenant and not to them so they are not losing the money if it is not allocated to them.

  8. It’s all about providing compelling evidence and managing the situation in a professional manner.

    Many landlords prefer to avoid getting into a legal battle if the amount involved is small (i.e. cleaning). They just pay for it and move on.

    In my experience if the evidence is presented to the tenants at check out, a friendly agreement is more likely to be reached.

  9. Hi All,

    I know that adjudicators aren’t biased. When I’m speaking at events I always tell the audience that the problem isn’t that the system is unfair, the problem is that the system is too fair. We expect landlords to be able to behave like lawyers at the drop of a hat with no previous training. This book is trying to address that gap in landlord’s knowledge and help them to put together convincing claims when they are in the right.

    I would also briefly defend the wording on the chart, Chris. If you, as a landlord, are out of pocket by the amount you claim then, if you lose, you do lose everything that you claim.

    I think that deposit protection is a good idea and goes some way towards protecting vulnerable tenants from unscrupulous landlords but we have to admit, after five years, that there are honest landlords out there struggling to make mortgage payments who need a bit of protection from unscrupulous tenants. Hopefully this guide will provide a cost effective way for them to get a fair hearing.

    Tom

  10. Truly excellent responses that I am glad to hear.

    I am surprised though that 5 years into the legislation so much is all up in the air, and I dont mean at the case law level of Tiensia etc, just peoples perceptions and expectations.

    I dont want to drag this excellent post down to the gutter level that I have to work in but speaking as someone who is directly involved in landlord/tenant disputes I would honestly say that for every 10 disputes I get involved in, the deposit is protected in maybe 2 cases at best.

    There is an underclass of landlord that I have to work with who even now either knows nothing of protection rules or, even worse, know about it but dont do it. Hopefully the incoming strengthening and clarifying of the protection rules will correct this imbalance with a few appropriately high penalties, well advertised

  11. “massive 82% of landlords who don’t get the decision they want” good landlords would be happy with “split awards” to fix the damaged door or repaint where kids have drawn on wall. etc.. Its only rare that we ask for the FULL deposit.

  12. @Chris: “The main problem is inadequate evidence from the landlord”
    Not necessarily. I think one problem is that adjudicators do not give equal weight to a DIY inventory conducted by the landlord, even if signed off by the tenant. The guidelines in ‘A Guide to tenancy deposits, disputes and damages’ make this distinction explicit in paragraph 2 of ‘Types of Evidence’.

    The only major dispute as a landlord that I ever had was as a novice landlord, where I’d written a one-page inventory, signed off by the tenant, at check-in. No photos. Together with good evidence of damage at the end of tenancy, I won my claim easily in the county court (£3,000). I highly doubt I’d have won with my DIY inventory via ADR.

    It is simply wrong to pre-judge types of evidence; all evidence must be assessed on its merits, impartially.

    In addition, the landlord cannot argue his case in person with ADR. It’s all on paper, and when the landlord is the party with the burden of proof, I think this places him at a disadvantage. A judge or adjudicator can’t judge a case properly without the opportunity to ask each party questions about their statement or evidence.

    • @westminster

      Greater weight being given to independent inventories is not an absolute and evidence is not pre-judged. The quality and reliability of the evidence is what is important and as the same document to which you refer states, the adjudicator will take into consideration the general circumstances and relationship between parties when assessing how much weight to give to evidence. (http://www.tds.gb.com/resources/files/A-guide-to-deposits-disputes-and-damages.pdf)

      Your main issue seems to be with ADR itself. Don’t forget you are not obliged to use ADR; for us to pursue a dispute all parties must agree to participate and that the adjudicator’s decision is binding. You can take a dispute to court if you would rather. But the expense and time taken by court means it is not an option for most people; a quick, cheap and accessible process is provided by ADR. We received nearly 700 disputes a month last year, paper based adjudication is the most efficient way to handle this volume of dispute resolution. Can you imagine how long this would take a court? Justice should be available to all and ADR is a big step forward in this respect.

      The onus is on landlords to provide evidence because the money they hold belongs to the tenant. Landlords and agents have had to tighten up their processes in the wake of deposit protection, and this can only be a good thing for all. Water tight written records will mean fewer challenges by tenants to legitimate deductions you want to make from their deposits.

  13. I advise all landlords that I come into contact with that they must keep receipts for everything that they buy. They must find out and where possible keep information about the expected length of time something should last, so that wear and tear can be correctly accounted for.

    We also make sure that all the properties we let have a full inventory with video back up as evidence.

    For a recent 3 bed property the inventory was over 30 pages long and in great detail. Both the tenant and the landlord could see the benefit in what was being done.

    It generally stops arbitration if both the landlord and the tenant see the value and if necessary monetary calculations at the end of a tenancy. They can see that wear and tear has been taken into account and the evidence is clear to all.

    Isn’t this ultimately what the legislation is trying to achieve?

    • Exactly right Sandra.

      It’s not only about getting the right money back to the right person. Making reliable processes a necessity for agents and landlords is improving standards across the industry and will reduce the need for disputes.

  14. Quality evidence, a clear understanding of what is expected from both the landlord and the tenant and meaningful dialogue …. if all are present then there should be no need to enter into dispute resolution…

    I spoke with Chris Kendall from TDS yesterday at the Landlords & Lettings Show and we discussed this very subject. One of the reasons I started providing video inventories was that as a landlord and former tenant I want to ensure that my properties are looked after and that tenants are fully aware of their obligations to ensure that they treat their home with respect.

    Both tenants and clients have realised the benefits of detailed and supported inventories that clearly let everyone know exactly where they stand and have commented that they feel secure in the fact that their deposit is safe from unfair and arbitrary claims.

  15. The book is a big forward step in simply but effectively educating landlords, agents and inventory clerks about the deposit dispute process. It will help a lot of people.

    Education is key as it sets a rationale level of expectation from knowledge. How many of the landlords unhappy with the result have heard of the word betterment? and understand what it means to them as a landlord and a claim.

    Retaining proof, receipts and invoices is again another key step as explained by Sandra. I am sure landlords keep enough paperwork for the tax man so keep it for the tenants, agents and arbitrator and your claim.

    The third key step is evidence. I agree with what people say about the source should not be a key indicator to the content but the quality of the content itself but understand how emotive landlords can be when conditioning their property or once home so it has to be considered and a consideration i am sure taken from history and experience. The TDS seem to quick to unpick the worth of an inventory presented by a landlord when its content maybe more impartial, objective and probative then an independent clerk so should be careful as i can teach landlords to produce far better inventory evidence then that supplied.

    As an expert in evidence and having seen the cycle of types of evidence in the criminal field the deposit schemes, industry associations, landlords, tenants and inventory clerks have the opportunity to learn quickly and replicate, understand its value and formats and gather inventory evidence that is impartial, unbiased, detailed, robust and corroborated making the subjective descriptions (good, fair, ok, clean) , objective, defined and qualified providing a defensible inventory for the parties to agree on.

    This objective level of evidence will prevent disputes, resolve disputes fairly and if other key factors are supplied and considered in unison with the inventory evidence as discussed a more happy balanced process for all parties involved.

    It works for the landlord and the tenant so completely impartial rather the subjectively impartial on an inventory clerks say so thats only fall back is that the tenant agreed with what was written but has done little to qualify or corroborate their own statement.

    The best form of evidence is 1st) Detailed written statement which is a transcribe from a methodical, precise and integral film recording. 2nd) Detailed written statement with pictures. 3rd) Detailed written statement.

    This form of integral, robust and corroborated criminal evidence shown on police camera action, cctv, observation points etc can be transferred into inventory evidence and presentations. Statements are inventory documents and the visual media and evidence gathering stays the same. Clerks are doing it everyday but i am certain many do not understand why they are doing it.

    If a landlord correctly provides number 1 from good training, education and experience, its content is better then a independent inventory presented in number 2 format as it is more accountable, objective and probative. If it tells and shows what slightly, good, fair or a few is, that is surely better then an independent inventory just subjectively say good condition.

    But if number 1 is available with a bit of skill uplift by clerks or in house letting agents why is not being supplied or demanded by landlords? It may take a slight more longer to gather better evidence (and i mean slightly or even quicker on a case study) but really no more expensive to produce so the cost should not differ to get more protection for landlords and tenants and improve industry standards.

  16. @ Tom “instead they tried to circumvent the system by just paying us the deposit (with the amount they wanted deducted) when we started the adjudication process.”

    They’re not circumventing the system, that is how it is supposed to work. Any part of the deposit not in dispute should be awarded to the relevant party straight away.

  17. A civil court case is decided on the balance of evidence, but the deposit protect schemes seem to assume the tenant is right unless the landlord proves it belong all reasonable doubt. So we will be better off just not taking a deposit and having a home owning guarantor that we can then recover damage from using the fairer civil court system?

    With the TPS it is possible for the landlord to refuse adjudication and force the tenant to use the court system while the TPS keeps the deposit safe in its bank account? (I can afford it taking 2 or more years as cash flow is not an issue for me.)

    The costs of formal inventory and checkouts are not cheap; one of our agents is charging both us and the tenant £60 for the checkout, the inventory cost about the same. That is a £240 “insurance” cost with a maximal pay-out of a bit over 1 months’ rent, so the insurance cost over 30% of the pay-out it may provide.

    A the end of the day, when the tenant move out there will be a few marks on the walls that come under “wear and tear” unless the damage is extensive it will not take me much longer to sort out 3 small marks then 5 large marks. So what does listing every mark on the walls in the inventory gain?




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About the post author:

Tessa Shepperson

Tessa is a lawyer specialising in residential landlord and tenant law. She runs the Landlord Law website (now in its 12th year) and is a director of Easy Law Training Ltd and Your Law Store. Tessa also sits on the Property Redress Scheme Council. When not working she enjoys reading, cooking and messing around on the computer. You can also find her on Google



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Tessa is an English lawyer specialising in residential landlord and tenant law.


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