Media: Landlords forced to withold deposits until tenants prove water bills paid

The_Conductor

http://www.thejournal.ie/landlords-water-charges-2088248-May2015/

THE GOVERNMENT HAS approved a proposal to draft legislation that would include deducting water charges from the wages and social welfare payments of people who do not pay.

Further details on the proposals also include an obligation for landlords to withhold a deposit until proof of payment is provided.

The proposed measures refer to the recovery of civil debt in general, but there will be specific provisions for the water compliance. Under the bill, creditors will be able to apple to the court for an order enabling either an attachment of earnings or deductions from social welfare payments.

Meanwhile, the legislation will allow the Department of Environment to strengthen the regulatory regime around the payment of water charges through measures not involving the courts. It means:

• The liability of the water charges will transfer automatically to an owner of a property if the owner has not provided Irish Water with the necessary details to procure payment from a tenant.
• There will be an obligation in all new tenancy agreements for the person who lives there to pay water charges, other than short-term lets where the landlord can retain this liability.
• There will be a further requirement for a landlord to retain a tenant’s deposit until the tenant provides evidence that they have paid their water charges. The government has stressed this is a “temporary role for landlords” until the PRTB takes over deposit protection.
• There will be an obligation to confirm that water charges are paid before the completion of the sale of a property to include a requirement to discharge arrears of water charges.

The government said the legislation will abolish imprisonment for non payment of debt for the vast majority of debtors.

Commenting this evening, Minister for the Environment, Alan Kelly, said “everyone has to be treated the same here”.

“We can’t have a situation where some people are paying their water charges while others simply refuse to pay. These measures are aimed at ensuring fairness in the application of water charges and will complement the civil debt procedures bill which will significantly reform the way all civil debt is treated in Ireland and move it way from what is a currently excessively bureaucratic procedure.”

The_Conductor

My own commentary on the publication of the draft legislation:

So- if the landlord doesn't give sufficient information to Irish Water for them to get payment from the tenant- the bill transfer back to the property (i.e. the Landlord).

Irish Water have a super-right that no other utility has- to purloin deposits- and its planned to keep this right until a deposit retention scheme is officially up and running with the PRTB- at which stage- the PRTB will liaise with Irish Water before handing back a tenant's deposit, deducting any arrears.

Those who can pay- but will not- to have their pay and/or social welfare benefits purloined in satisfaction of the debt.

Those who cannot pay (there will be doubtless be many)- will presumably be assisted in paying- I'm guessing the DSP bribery scheme will probably morph into a means tested utilities assistance scheme over the next 3-4 years.

Imprisonment for non-payment of bills abolished (well- if they're purloining salaries and social welfare payments- its moot anyway).

All-in-all, I think the government's bill will annoy the living hell out of both landlords and tenants- and it places an unfair burden on landlords that really is not theirs to discharge. It also calls into question, yet again, the common practice of tenants using the deposit to cover the last month's rent- and the practice of landlords levying 1 month's rent as a deposit- which is significantly nullified- if a utility has first dibs on the deposit over and above anyone else (including the landlord).

Further- I'd like to know what basis there is for compelling a landlord to supply sufficient personal information about tenants, to assist Irish Water in collecting its fees. I can see this getting challenged. Aside from anything else- a Landlord is unfairly penalised if they do not hand over the information (as they are then made personally responsible for any outstanding charges for their property- regardless of what the tenant's motivation for not discharging the bill).

I think its deeply unfair and flawed- and will amongst other things- needlessly aggravate landlord-tenant relationships.

Arbiter of Good Taste

I guess we'll start seeing deposits rise by €160/€260 per property (at least)

As a landlord, this makes me mad as hell. It's not enough that I'm being a good citizen and paying my own charges, but now I'm to be some kind of government enforcer

Atlantic Dawn

Will it be for all utility bills or just water?

Pawwed Rig

Ironic that Irish Water refuse to tell me whether my tenant is registered or not due to data protection. I agree with with the above and will be raising deposits from here on.

the world wonders

So if the deposit is €1k and there is

• €5k of unpaid rent
• €2k of damage to the property
• €200 of unpaid water bills

Who gets what?

NIMAN

Sounds fair enough to me.
Tenant uses water, he pays for it.

The_Conductor

the world wonders wrote: »

So if the deposit is €1k and there is

• €5k of unpaid rent
• €2k of damage to the property
• €200 of unpaid water bills

Who gets what?

Irish Water get their pound of flesh- over and above any other creditor- including the landlord- thereafter other costs are deducted, to the max of the deposit.

In practice- this little switcheroo on the part of the Minister- will serve to highlight how inappropriate a single month's rent is as a deposit.

Further- there is provision to allow other utility company also purloin the deposit for unpaid bills- however Irish Water is actually named- and is at the head of the queue.

There is zero cognisance or acceptance on the part of the Minister that tenants may not intend to pay their last month's rent- or may have rent arrears.

QED- Landlords to charge significantly higher deposits going forward. When the PRTB take over deposit retention- charging several month's deposit will be fully justifiable- providing the PRTB are prompt at assessing deductions to be made- and reimbursing tenants and landlords in an appropriate manner from the deposits.

It'll be another manner of keeping everyone on the straight and narrow- but it will also massively serve to highlight how higher deposits are absolutely required.

The_Conductor

NIMAN wrote: »

Sounds fair enough to me.
Tenant uses water, he pays for it.

Its actually tenant uses water. Doesn't pay bill. Doesn't pay last month's rent. Landlord left to pick up the pieces. Landlord also unable to sell a property- if previous tenants have not paid bill- as Irish Water will now have a lien associated with the property........

Its all in favour of Irish Water. Its definitely not in tenants or landlords interests- this is handing the entire deck of cards to Irish Water.

Grandpa Hassan

LLs risk getting pretty exposed here. The safest thing IMO is to keep the water in the LLs name and increase the rent by that amount

RedXIV

Not even a landlord here but jesus you guys are getting screwed.

Stacking everything this high in favour of Irish water seems like easy pickings for opposition parties to focus on in GE propaganda, but I'd be worried that this will gain too much traction in the government for them not to consider doing it for other utilities where the government has an interest.

_Brian

I was checking out the PTRB website last night.

What it was saying there was that while the tennant is in the house the landlord needs to ensure IW is informed there is a tennant, the tennant is then responsible for the water during their tenancy, when the tennant leaves the landlord should advise IW.

It definitely gives te impression that at no stage will the LL be liable for the tennants unpaid IW bill.


Here's an extract:
I am a Landlord and my previous tenant has left the property without paying an Irish Water bill. Will I be liable?
There is currently no provision in existing water services legislation that makes the landlord liable for unpaid water charges incurred by a tenant. However, the Minister for the Environment, Community and Local Government has recently indicated that further legislation will be published shortly, which will deal with the non-payment of water charges.
A Landlord should contact Irish Water immediately upon a tenant vacating to ensure that the change in circumstances is recorded. If the property remains vacant you can apply for the ‘’not permanently occupied rate’, details of which are available from Irish Water. Once the property is re-let the new tenant should contact Irish Water immediately with the date of commencement of their tenancy.

Link;
http://www.prtb.ie/tenants/helpful-info/irish-water-charges-q-a

Baby01032012

_Brian wrote: »

I was checking out the PTRB website last night.

What it was saying there was that while the tennant is in the house the landlord needs to ensure IW is informed there is a tennant, the tennant is then responsible for the water during their tenancy, when the tennant leaves the landlord should advise IW.

It definitely gives te impression that at no stage will the LL be liable for the tennants unpaid IW bill.


Here's an extract:
I am a Landlord and my previous tenant has left the property without paying an Irish Water bill. Will I be liable?
There is currently no provision in existing water services legislation that makes the landlord liable for unpaid water charges incurred by a tenant. However, the Minister for the Environment, Community and Local Government has recently indicated that further legislation will be published shortly, which will deal with the non-payment of water charges.
A Landlord should contact Irish Water immediately upon a tenant vacating to ensure that the change in circumstances is recorded. If the property remains vacant you can apply for the ‘’not permanently occupied rate’, details of which are available from Irish Water. Once the property is re-let the new tenant should contact Irish Water immediately with the date of commencement of their tenancy.

Link;
http://www.prtb.ie/tenants/helpful-info/irish-water-charges-q-a

Brian the whole point of this thread is that there will be legislation in place to compel the landlord to withhold deposit until water charges have been paid as announced by the minister yesterday.

The_Conductor

Being discussed on Morning Ireland now. It's being highlighted that while Irish Water have preferred status for any call on the deposit, that for the first time other utilities will also have the right to purloin residential deposits too. The Landlords Association are predicting chaos.

Pawwed Rig

The_Conductor wrote: »

Being discussed on Morning Ireland now. It's being highlighted that while Irish Water have preferred status for any call on the deposit, that for the first time other utilities will also have the right to purloin residential deposits too. The Landlords Association are predicting chaos.

So essentially a landlord is now a subordinate creditor on the deposit on their own house :pac:. A simpler solution would be for utility companies to have their own deposit system No? Airtricity already do it.

_Brian

That happens where a tenant is in a property long term and the bill goes unpaid ? The deposit will be insufficient to cover the charge.

Will LL start having a clause in the rental agreement that renewal is dependant on seeing evidence of the bill being paid, this would protect from years of accrued charges.

wazzer1

So far we (tenants) have received 2 letters (reg.pack and first bill) to where we are renting in our landlords name. Both have been forwarded onto her. Its not in our name so there is not much we can do about it

triple nipple

When did Ireland become a communist dictatorship?

The_Conductor

wazzer1 wrote: »

So far we (tenants) have received 2 letters (reg.pack and first bill) to where we are renting in our landlords name. Both have been forwarded onto her. Its not in our name so there is not much we can do about it

If the landlord does not forward your details onto Irish Water- the bill is associated with the property- and the landlord is expected to pay. Once the landlord has forwarded your details on to Irish Water- Irish Water are expected to chase you. If they don't- the onus remains on the owner of the property to pay the bill. If the tenant ignores letters (because they are addressed to someone else- or for whatever other reason they may have)- and does not register with Irish Water themselves- they don't qualify for the DPS bribe (100 Euro off their annual bill).

If you do not register- and you've had ample opportunity to do so- the entire bill can come off the deposit- and you don't get the 100 Euro rebate.

The cards are stacked against both landlords and tenants here- the entire deck of cards have been handed over to Irish Water (and indeed- other utility companies will be perfectly happy to piggyback on this arrangement- as it means unpaid bills become secured loans- which is grossly unfair on landlords.

Its quite a remarkable bill- and diminishes any security a landlord might have on their property. A tenant who takes out UPC or Skysports or whatever- and doesn't pay for a year- could run up a bill of thousands- which might bankrupt a deposit- long before any other costs or damage were assessed.

The likely outcome of all of this- and the only sane outcome- would be for landlords to vastly increase the amount of deposits being demanded from tenants.

Its time for both tenants and landlords to unite against this quite remarkable over-reaching piece of draft legislation.

godtabh

My lease agreement states that all utilities must be paid by the tenant.

I have advised my tenant of this. I have told Irish Water that there is a tenant intuit (but not given any details). My tenant has indicated she wont pay.

I have sent a link to her from the indo about yesterdays announcement. Doubt she will change her mind. Its going to be some mess/argument when she leaves.

Its sickening that I am being dragged into something that is not my remit. If Irish Water want me to act as their debt collector I will be charging them a management fee.

gaius c

godtabh wrote: »

My lease agreement states that all utilities must be paid by the tenant.

I have advised my tenant of this. I have told Irish Water that there is a tenant intuit (but not given any details). My tenant has indicated she wont pay.

I have sent a link to her from the indo about yesterdays announcement. Doubt she will change her mind. Its going to be some mess/argument when she leaves.

Its sickening that I am being dragged into something that is not my remit. If Irish Water want me to act as their debt collector I will be charging them a management fee.

We've the opposite problem. Landlord is trying to "stay below the radar" and wants us to pay but in his name. It's a mess.

The_Conductor

godtabh wrote: »

My tenant has indicated she wont pay.
If Irish Water want me to act as their debt collector I will be charging them a management fee.

Irish Water are quite happy for your tenant to not pay their bill. They also don't care that you haven't given them the tenants name and details. The bill is associated with the property- and ultimately- in the absence of the tenant paying- it is the landlord's responsibility to pay. This is the new 'norm'. You will similarly be expected to pick up a tenant's unpaid electricity, gas, phone, internet, Skysports or whatever else- they may have associated with the property.

In light of the new status of utility bills- and the new security that the companies have associated with their bills- the Minister is removing the sanction of jail and fines for those who do not pay their bills- as the companies can now quite simply purloin the deposit in the first instance (Irish Water having first call on the deposit over everyone including the landlord)- or put a lien on the property itself.

Its very dangerous territory- and means landlords are responsible for utilities (all utilities- not just water) supplied to any properties they own.

Putting a condition in a lease that a tenant is expected to pay all their utility bills- is not going to cut it.

Any sane landlord will need a separate deposit, sufficient to cover any arrears that may build up for the various utilities associated with a property. If utilities bill every 2 months- how long before the service is cut off? Another 2 months? In which case- you'd need a separate deposit sufficient to cover all utilities for a minimum of 4 months- possibly longer for water which won't be cut off at all.......

Its entirely new territory- taking the responsibility from tenants to pay their bills- and instead putting an onus on landlords to ensure tenants pay their bills.

I, for one, am deeply unhappy with the vastly over-reaching provisions of this draft legislation- and have serious issues with it.

The only carrot to try and persuade tenants to pay their water bill- is the 100 Euro 'rebate' that they won't qualify for- if they do not. There is no commensurate rebate associated with other bills.

This proposed legislation is a recipe for civil unrest across the board- and indeed, is almost unique in that both tenants and landlords really need to unite together to make the Minister reconsider the bill. It has incredibly far reaching provisions for everyone involved.

Wanderer78

The_Conductor wrote: »

The cards are stacked against both landlords and tenants here

The likely outcome of all of this- and the only sane outcome- would be for landlords to vastly increase the amount of deposits being demanded from tenants.

i agree with this. i can see deposits dramatically increasing over this and rightfully so. his whole thing is a nightmare

godtabh wrote: »

Its sickening that I am being dragged into something that is not my remit.

this whole irish water thing is a disaster for both tenants and landlords

Pawwed Rig

I can't see a deposit of anything less than €200 per utility being worthwhile. Probably more if the tenant is rent allowance as a follow up case with the PRTB will most likely yield nothing.
Will also investigate putting all utilities in my own name and charging an 'admin fee' for looking after them. Who would want to be a landlord

Field east

Pawwed Rig wrote: »

So essentially a landlord is now a subordinate creditor on the deposit on their own house :pac:. A simpler solution would be for utility companies to have their pown deposit system No? Airtricity already do it.

(1) The minister said, from one of the above posts , that he wants to treat everybody equally re the supply of water and getting paid for it - I assume no exceptions. So why then is he making a special case with regards to the method of collection when it comes to non paying tenants.

(2) why is the minister creating another system of forcing payment through deposits for non paying tenants when the one of putting an attachment onto RA, other social welfare payments and wages would achieve the exact same objective.
So, why reinvent the wheel when the attachment system will be in place and why is it necessary to involve another two players, ie LL and PRTB, and all the
admin , cost , complications and hassle that will bring. The only conclusion I can come to is that the gov wants to justify the existence of the PRTB by routing the collection of unpaid water charges through them and , by stealth, to get the deposit retention issue under its control.

(3) if the suggested draught law is passed, then I can see the typical LL doing the following - based on a 4 year tenancy and where it is assumed that the tenant will not pay the water charge.
Take a studio at €500 /mt - average over 4 years and an annual water / sewage charge of €160. The LL would collect a deposit of 500 + (160 by 4) = €1140 .

If the tenant did not pay the water charge during the four years the LL can then terminate the tenancy - and use the water deposit to pay for it- which I expect she/he would.
BUT , if the tenant pays the water charge annually, the LL would refund , in full, annually. But what does the LL do in this scenario if the tenant is very compliant for the first 4 yrs but then stops paying when the tenancy is renewed and no deposit to meet it?
This strategy will further agreviate/annoy the rent accomodation seeking public. It will work for the LL currently when there is such a demand for accom but may cause a difficulty for the LL when accomodation is not at a premium.

(4) If a tenant refuses to pay the water charge, then can that be another legal reason to end a tenancy. Ie. can it be added to the list of reasons where a tenancy can be terminated? After all, the Gov plans to stall the sale of a house in a case where water charges are outstanding
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godtabh

I am just thinking back to a separate tenant. They left without paying their UPC and electricity bills. The apartment got many letters about this. I was never directly contacted (why would I bill wasnt in my name) but I assume there was a vast amount of outstanding bills.

Based on my own UPC/electricity bills my deposit would be gone in about 3 months of unpaid bills. Imagine if they were never paid? Or the tenant repeatable changed provider?

Wanderer78

godtabh wrote: »

Imagine if they were never paid? Or the tenant repeatable changed provider?

this is a disaster for landlords. deposit increases are probably the only solution.

godtabh

Wanderer78 wrote: »

this is a disaster for landlords. deposit increases are probably the only solution.

Thats going to be a hardsell. People will resent paying higher rents and the issue of last months unpaid rent will become worse

Wanderer78

godtabh wrote: »

Thats going to be a hardsell. People will resent paying higher rents and the issue of last months unpaid rent will become worse

ah the whole irish water thing has been so badly handled that nearly everybody has their backs up now. for something that should/would benefit us all, what a disaster.

The_Conductor

Wanderer78 wrote: »

this is a disaster for landlords. deposit increases are probably the only solution.

Apparently the PRTB are in the process of setting up a deposit retention scheme (I'm not sure when it'll go live- but realistically it'll probably be at some stage in 2016). I'm guessing they'll outsource its administration, in a similar manner that they've outsourced other functions to the South Western guys?
They *need* to knock the 'using my deposit for the last month's rent' thing on the head.

Wanderer78

The_Conductor wrote: »

Apparently the PRTB are in the process of setting up a deposit retention scheme

They *need* to knock the 'using my deposit for the last month's rent' thing on the head.

how will this scheme work?

yea that whole last month deposit thing has to end. it exposes the landlord.