Caught in the Middle

[Editor’s note: This article is intended to provide further context to Ivan Budanov’s article “Knock, Knock! Commotion in Charlotte Quay Dock“.]

The housing-advice charity Threshold often comes across cases where tenants are confused, seemingly stuck between a landlord and a receiver.

In theory, when a receiver is appointed over a property, tenants are obliged to pay the rent to that receiver, says  Legal Officer Gavin Elliott.

The landlord, meanwhile, still has all of the obligations that they always had: paying back a deposit, fixing a boiler leak, that sort of thing.

In practice, however, things work somewhat differently, he said.

“What we see an awful lot is landlords and receivers arguing over whether the receiver has been validly appointed, so tenants getting caught in the middle.”

“We would see that three or four times a day, I would imagine,” said Elliott.

In those cases, it sometimes goes like this: a receiver is appointed and sends a letter to the tenant that it should collect the rent going forward; then the landlord says he’s challenging the appointment and that the tenant should keep paying him the rent.

“It’s very difficult to advise them in that situation. Our general advice is that the receiver is entitled to the rent,” said Elliott.

That said, while in the vast majority of cases the receiver is appointed correctly, it does occasionally happen that a mistake has been made, said Elliott.

In the case of the apartment in Charlotte Quay Dock, the landlord Brendan Kelly said he wasn’t willing to talk on record about the apartment.

A spokesperson for Deloitte said it is the receiver for a unit there, and as such, it should be receiving the rent.

He also said that Deloitte was very concerned with any allegation that implies they are heavy-handed or aggressive in conducting their business. “This is very concerning to us particularly as the story was submitted by a child,” he said.

He said that they tried to make contact with the tenant by mail but didn’t get a response so an agent had to call to the property. “We strongly maintain that this agent was in no way heavy handed or aggressive.”

“In terms of remedying the situation, we would recommend that the tenant makes contact with Deloitte as per the request in the written communication already received by them,” said the spokesperson.

Elliott of Threshold – who spoke generally rather than about this particular case – said that the arrangement that comes into effect at the moment when an apartment goes into receivership is unsatisfactory.

“One of our policy positions has long been that receivers should be treated fully as landlords,” he said. That would require legislation so that once a receiver steps in to take the rent, it also steps into the shoes of the landlord completely.

Tenants are innocent third-parties in all of this, he said. “Tenants are entitled to quiet enjoyment of their property.”