Definitive answer to a silly question

Definitive answer to a silly question

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Hi all,

My client has a buy-to-let flat, which is let to a mate of her ex-, and they remain amicable. Usually... 

The ex- has tended to collect the rental monies on her behalf and normally banks the money for her. This worked well until her ex got into financial difficulties and surprise surprise, she has not received four months' rent paid by the tenant. This was without her knowledge or consent. Her ex has promised to pay her back when his own business gets straight, but realistically, the debt is at best doubtful.

The ex is not a letting agent and I cannot find a definitive answer as to whether we may claim bad debt relief, given the not-quite-arms'-length nature of the theft. 

Any guidance gratefully received with thanks.

  

Replies (5)

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By Cloudcounter
15th Jan 2013 08:30

Not definitive

but I don't think that any relief is available.  The tenant has paid the rent to somebody approved (at the time) by the owner.  I can't see that the fact that the ex has effectively stolen the money has any bearing on it.

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By George Attazder
15th Jan 2013 09:42

I agree with Cloudcounter

Since the rent was paid by the tenant, there's no bad debt.

Relief would only, therefore, be available if it represented a loss arising out of the property business.

I'd say that the loss doesn't arise out of the business, but out of the proprietor's personal arrangements.

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Euan's picture
By Euan MacLennan
15th Jan 2013 10:18

Going forward

Get the mate to pay the client directly or kick him out of the flat - if the client is not receiving the rent, she would be losing nothing.

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By Nick Graves
15th Jan 2013 11:02

Thanks guys

That's what I thought, but I wondered if I was missing a trick. One gets too close to these things at this time of year. 

The mate does now pay the client directly (20/20 hindsight...) so it won't recur.

Thanks again & Happy New February!

 

 

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By Richard Willis
15th Jan 2013 12:14

I am with Cloudcounter

It is theft, pure and simple!

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