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Permitted Occupier's right to deposit

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408 views 3 replies latest reply: 28 May 2016

I was the only tenant on a year long AST, sharing a 2 bedroom flat with a permitted occupier (they were meant to be a tenant but could not be added to the contract as well so we verbally agreed to this to avoid delays as we needed the flat). We did not have any written agreement but they did sent me half the deposit when signing and half the rent monthly.

They chose to move out after a few months and I agreed to it as long as they found someone to replace them (the agency would only hold me liable, they didn’t care about the occupier). They left without finding a replacement, I eventually found someone but I’ll have some losses at the end of the contract because I lived by myself for a while until I found this new person.

The previous occupier now wants their deposit back. I don’t have it, it’s with the agency. Moreover, I can use it to cover my losses incurred because of their departure without finding a replacement. Can they have any legal claim to their deposit now? Can they make any such claim at the end of the contract when the deposit is returned? Can I safely use it to cover my losses? A landlord would be able to use deposit money to cover unpaid rent, is it the same case now?

Thanks a lot for your advice!


Hi Michael- from the information you have provided they have no claim, via the agent/landlord, for the deposit. However, should they wish, they could possibly pursue you through the courts for this money. Although there is no contract, you have stated they were a permitted occupant and, as such, are not bound by any terms of the contract (as to financial repsonsibilities). This is the risk you took on by renting with a PO instead of having a joint tenancy. I would advise tryng to reach an agreement on an amount to be returned and then move on.

Hope that helps


Thank you for your reply!


I was also told in this case from a legal standpoint I would be considered ‘landlord’ and them my ‘tenant’. If that’s the case can they claim their deposit was not put in a protection scheme and I would thus lose by default if this gets to court? They gave notice when the next rent payment was less than 1 month away, would that make a difference?

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Hi Michael,

They were definitely not your tenant, so would not be liable for any penalty.  Unless you were in a relationship with them, they were your lodger. Lodger’s deposits do not need to be protected.

As you appear not to have a written agreement with them, it will then depend on the verbal agreement you had.

If there was a verbal agreement for the fixed term and as you say, you agreed to them leaving on the condition that they found a replacement, then they would be liable to you for any shortfall in rent. If there was only a periodic agreement, then if they gave you reasonable notice, usually a rental period and paid up to the end of the rental period, then you should return the deposit.

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