A little help please

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    Hi folks

    Any ideas on this one.

    We have a customer who is 20 weeks in arrears and said he was in dispute with his l/l.
    We advised him that due to the level of arrears we would have to pay to the l/l. He then said he had a solicitor and the rent was being with held back due to issues wth the l/l. At this point we said we could pay to the solicitor and he could hold the HB payments until the dispute was sorted however we would need something official from the solicitor.
    Following this conversation it would appear that the customer did not actually have a solicitor and went direct to the landlord. We do not know what happened but can hazzard a guess, as the landlord has now paid the tenant £500 to never contact him again. The landlord has written to us and said that he does not wish to pursue the arrears and has written off the debt.
    This means that that the customer is no longer classed as in arrears – do we now have to pay him the 20 weeks HB even though he has never paid a penny in rent and never will.
    We have considered if he has a liability but as the landlord has said he will no longer pursue arrears that implies that arrears were being accrued and therefore there had to be a liability.

    We cannot see a way in which we cannot pay and want to make sure we are doing this by the book.



    In my view, I would say, from the point arrears started accruing, there is no longer any enforcable agreement as the L/L has refused to accept rent payments. So no liability from that point, in my opinion. That’s a fact, as L/L has stated. Let the claimant appeal the decision and see how it goes.

    Wish I could get your claimant to have a word 😉 with my lender 😀 .

    Kevin D

    Based on the info given, I’d follow Kay’s approach – with one additional observation.

    Let’s say that, in the narrowest possible interpretation, there was a liability and that it was simply a written off liability (in much the same way as a write off for an overpayment doesn’t extinguish the overpayment – it simply won’t be recovered). What then? Simple. Non-commercial as the terms aren’t (and weren’t enforceable) – HBR 9(1)(a) in conjunction with HBR 9(2).

    The decision could be something like this:

    1) No liability; or alternatively,

    2) If there is a liability, the agreement changed to being one that was not on a commercial basis on the grounds that terms relating to rental payment and enforcement became unenforceable; or alternatively,

    3) If there is a liability on a commercial basis, payment must be made to the LL as there are arrears in excess of 8 weeks and the clmt hasn’t demonstrated it is in his/her overriding interest not to make payment to the LL. Even though the LL has stated s/he is not pursuing the arrears, this does not alter the fact that any non-payment of rent constitutes arrears in the context of the facts of this case.

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