Letting agency fined in pioneering law case about tenant deposits

A lettings agency has become the first in Scotland to be sanctioned for breaching rules that secure the deposits of its tenants.

The landmark ruling against Colvin Houston Ltd at Kilmarnock Sherriff Court may have implications for the lettings sector across Scotland as it was the first time an agent was prosecuted under the Tenancy Deposit Schemes (Scotland) Regulations 2011.

The legislation was set up to ensure deposits were ring-fenced in independent tenancy deposit schemes and protected by third parties until they were due to be repaid.

These schemes were established to stop tenants from losing deposits unfairly - but until this week had never been used against letting agents.

Housing legislation north of the border primarily places the responsibility for securing deposits on landlords but consumer protection legislation was used in this instance to hold an agent responsible for the deposits they took on behalf of their landlords.

Colvin Houston Ltd, of Largs, pleaded guilty to the charge relating to two specific deposits, amounting to £925, which had not been paid into a required tenancy deposit scheme. The company were fined £750 which was reduced to £500 for an early plea.

“The statutory duty to protect a deposit is on the landlord even when a letting agent is used so it’s essential to seek confirmation that this is happening and alert the authorities where it is not. We hear first-hand about the success and benefits of the scheme in providing assurance for tenants and landlords alike” says Jen Paice, chief executive of SafeDeposits Scotland.