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  • HMO & Multi-Lets

    Should I Pay or Not?

    Sorry for the ramble....the aim being not to miss any important details....but I would appreciate if you could take the time to read this and give me your thoughts. 
    I have been a landlord for about 7 years and recently I have been dabbling quite aggresively in the HMO MARKET. It so happens that three of the houses that I own are on two streets of terraces, lets call them A, B and C. In fact you can look out the back off house C and see the the middle house B and look out the front room of B and see A. In other words they are very close together in fact so close, that in a diagonal line there must be a 150 metres between A and C.
    One day I happened to be in House B (which was being refurbed) and noticed that I was picking up the wirless signal from House A...groovy online and able to perform online activites whilst keeping an eye on the workforce :-)
    Pushing this further got me thinking. If I was able to do this there should be nothing stopping my tenants doing the same - as long as they had the credentials.
    Obviously it would have to work in all communal areas and all bedrooms and furthermore it would have to be as realiable as a normal dedicated connection....the more I thought about it the more of a money saving idea it became.....doing the maths....each connection currently costs me £50.00 pcm, thats £150.00 pcm combined over the three houses, over the course of a year thats £1800 as opposed to £600.00 for just the one. A potential saving of £1200. Extrapolating this Over lets say the next twenty years a decent amount of money.
    Now I have a first class honours in computer science and used to earn a very decent day rate as IT Consultant and know a little bit about a thing or to. I gave up my city life to become a fulltime landlord with my better half. I went to a few computer shops spoke about routers, range extenders and from everything I was hearing it looked promising. Not really having much time to dedicate to this and wanting to make sure it worked without interruption for my customers I decided to outsource this to a local computer networks man.
    After a brief chat on the phone, a site visit was arranged. I met the gentleman and walked him to each of the properties, talking about layouts, siting of routers etc etc. At this stage I had two requirements: A, all equipment would need to be in communal areas in case of resets and the provision of the internet should be on demand, regardless of which property or which part.
    At this point I was assured that this was an easy type of problem to be fixed. The solution being a cental router in house B, with range extenders in houses A and C. 
    The equipment was ordered and the installation date arranged.
    On the day of installation - House B was able to receive internet - due to the central router. House A had a range extender installed in the communal hallway, and House C had a range extender in the hallway again. On testing the system House A and C were not able to get any internet access. The network man said it was to do with the number of walls and the thickness of the walls etc. 
    Looking rather meek faced, he suggested that in order for this to work it would be better to place the range extenders in line of sight - the best possible places being the window Sills of bedrooms in House A and C. I was not happy with this approach as I know that sometimes there are needs to reset equipment, routers...this equipment NOW being in a tenants room, what would happen if the range extender needed rebooting and noone was in the room/door locked, or the tenants in the room were being interrupted by other house mates as they were having problems. Reluctantly I let this be tried.....the results were there was a bit better signal, in House A - although slow, House C had a very slow connection....more akin to dialup...
    I let this be trialled at House A with House C reverting back to its dedicated connection due to the speed problems with the new system.
    Over the next few weeks at House A there were various comments by the tenants that the internet was slow, frequently unavailable on countless occasions I or staff members had to visit the house and reset the router - not a real problem for my staff as they live in another house of mine in the next street. I communicated this to the network guy who stated that what was required was larger antennas. This would ensure the signal in all areas was satisfacory. He could not understand why I had to reset the routers as the connection should not drop like that which was being experienced.
    New antennas were ordered and the gentleman came by and screwed them to the range extenders, on testing there was no real improvement. I communicated this to the gentleman.....who said to leave it with him and he would investigate further.
    A few weeks passed, many more complaints...a tenant left suddenly, his reason due to not having satisfactory connection as he was sometimes homebased - i have his reasons in writing as he left during the fixed term. At this point I packed up all the network mans equipment, decided that it was not worth the hassle and reordered 12 month contracts with my ISP for the other two houses. 
    Since they have been running on dedicated routers all has been fine, they are located in communal areas...so if they require a reboot it is easy for anyone to do. I communciated this to the network engineer who said that as I had ordered ISP lines he was going to leave it in my hands, although he had done a bit of research and the Belkin N1 Vision had a history of dropping intermittenly and this could be the cause of some of the problems.....he wanted another chance to come and try another router.
    Fast forward on a few weeks I had a dedicated connection in each of the houses. it worked....no more complaints, no more tenants telling us how important broadband was to them. life was good....yes i was paying for three connections but so what sometimes the technology doesnt fit...you have to move on. During these few weeks granted the networks gentleman did call me...but as the internet was working again...seeing him for him to try another option was the bottom of my priority list.
    Me and my good lady operate a very customer orientated business, all our tenants are our customers, ones we endeavour to keep happy and at least be able to provide the services that we advertise that we offer. The provision of broadband these days is very common and the ability to access it should be seamless, inevitably there will be initial teething problems - but the ones we experienced were constant and continuous. We have to protect our interests.
    The other day I received another invoice from the gentleman for approxiamately £1500.00. We at no point discussed costs etc, I didnt sign anything with him and as I was busy overseeing 3 houses being converted into HMO's I sort of left him to it.....in a way this was my fault for not having discussed the finer details.
    I replied to his invoice request stating that the solution he proposed and trialled did not work and resultantly I had to revert back to the 3 services. I did not see how he could justify the payment as it did not work....what was I paying for? I told him that he should make an arrangement to come and collect his equipment.
    This morning I received a claim form from Money Claim online for the sum of 1500.00 pounds.
    We have now requested the tenants that were impacted by the loss/interruption of service write to us, so that we have written communications detailing the problems they experienced with the broadband when the system was in use. We have also taken measures to establish contact with the tenant who vacated and have asked him to demonstrate the same.
    These statements could obviously be used in any litigious matters that arise from this point onwards. Should we defend any such actions and issue a counter-claim for loss of tenant and income resulting from this.
    What do the tribe think? Bearing in mind what you have read would you pay? Would you defend it with a risk of getting a judgement against you if all did not go well at court? A judgement scares me as I am still able to get mortgages and have an impeccable credit rating - with rapid but solid expansion plans in the future.
    For me it makes common and business sense to have paid for this solution if it had worked - the long term savings are a great motivator. The fact of the matter is it didnt. In all my dealings I have never shirked a payment for when work is done or services provided. The amount of money is not that much but it would leave a bitter taste in my mouth to pay for something when my heart and head tell me I shouldn't.
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    quick question for others:
    If you get a CCJ, but pay immediately is it still registered on your credit profile (or has a negative effect?)
    I ask because I was told, years ago, that if you pay within 4 weeks it had no impact on your profile - but I never took the time to verify this (...nor have I had the opportunity to test the assumption personally lol).

    Btw Anil, I'd probably not pay...but that's just because I'm tight, hate it when I don't get the results I want and would enjoy finding a way to defending the court case (....as long as I wasn't too busy)
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    Thanks Susanne.
    Susanne said:
    if you pay the amount ordered by the court within the time frame ordered by the court you do not get a CCJ
    i'm not a tecchie... was the first attempt to get all three properties working which cost £1500 actually illegal ?
    Why did you not discuss costs with the guy ? I would never commission someone to do work without knowing the costs - alberit estimated costs - in advance.....
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    Hi Anil
    if you had a boiler break down and the plumber came back and forth trying to fix it but in the end said the manufacturer would have to come and fo it would the plumber still want paying?
    Yes they would.
    I think the charge seems excessive though I don't know how much work he did.
    I'd call him straight away and agree a settlement figure. He's done the work but you didn't get what you wanted so a settlement seems the sensible solution.
    Be careful with the CCJ - the date it's deemed to have been served will be well before you received it and you usually only have 14 or 28 days to respond.
    Ahm,
    to clarify; the court papers are issued, if you don't respond the court will automatically issue it's judgement - the CCJ. No matter when you pay the CCJ has been registered against you.
    If you contest it or offer settlement or a payment arrangement before it gets to court then a CCJ can be avoided.
    If however the issuing party refuses and it still goes to court and let's say the court agrees to a settlement or a payment arrangement then this is still a registered CCJ.
    It's all about whether the court made the judgment - if it did you have a CCJ.
    The exception is council tax which is a liability order, not a CCJ, and won't appear on your credit file.
    Regards, Lisa
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    Lisa All comments are for education and information purposes only and do not construe as advice or a financial promotion. No liability is accepted for comments made. If you wish to receive information in an advisory capacity then please contact me about becoming a client. www.keys-mortgages.com

    Hi thank you very much for your responses.
    I have just read the following on the https://www.direct.gov.uk/en/MoneyTaxAndB.../CourtC... website.
    County Court Judgment (CCJ) records
    Unless you pay the full amount of the judgment within one month, your CCJ will be recorded on the Register of County Court Judgments for six years. Organisations such as banks, building societies and loan companies use the registered information to help decide whether to give you credit or loans, like a mortgage.
    Lisa can I seek further clarity? If it goes to court and the judge agrees with the claimant and requests I pay 1500, if I pay this amount within one month...is the CCJ still recorded on my credit file? and if not this will not have any bearing on my credit file?
    So am I right in thinking if I this went to court....and I lost I could pay up....and nothing adverse would be on my credit file.
    Susanne. I did check with the ISP's about whether there was a problem with sharing broadband connections....they said as far as they knew it was fine to share a connection as long as it was secure and I gave permission. They also suggested a set of range extenders which they said gave more coverage.
    I am going to give this guy a call today but I get the feeling he is not very reasonable and will probably not budge as his action has caused the desired reaction.....
    Dreading making the call....lol...all this two days before my holidays.
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    Further Information
    I have just checked out with some court offices as well.
    If I take this to court and a judgement is awarded against me, it will be marked on my credit file straight away. If I pay within one month it will be removed very quickly as long as the claimant states that he received the payment. If on the other hand I paid it after one month then it stays on my credit file as being satisfied.
    I just checked this with my local court manager - who double checked.
    hmmmm another twist or perspective....my missus of 17 years (bless her) has just said all the bills for every house/hmo we own are in her name, as she is responsible for all bills and services the claim form should state her as the defendant and not me.
    Although I instigated the initial contact, and all the communications were between me and the network engineer...it was under her direction. The claim form really needs to be in her name and not mine. This could form first line of my defence...causing a reissue.
    We have spoke to each other about this at lenght, my missus is very principled and wants to fight this all the way...
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    I apologise.
    Suzanne is right; if you pay within 4 weeks of the judgment it ISN'T recorded.
    I've never had one pay up so hope you'll forgive the error!!
    KR, Lisa
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    Lisa All comments are for education and information purposes only and do not construe as advice or a financial promotion. No liability is accepted for comments made. If you wish to receive information in an advisory capacity then please contact me about becoming a client. www.keys-mortgages.com

    Anil,
    Verbal agreements or arrangements for jobs like this can, as you’re finding, come round and bite. Personally, I don’t see how the Claimant can justify the £1,500 he is asking for, but he obviously thinks differently.
    Unfortunately, there were mistakes on both sides, so if you want damage limitation and not waste your time, then I would do as Lisa suggested and try to reach a settlement.
    One thing for sure, he has jumped the gun and not gone about the process correctly. There is a Pre-Action protocol that he should have followed – including notifying you of his intention to take court action and giving you the opportunity to remedy the situation. Failure to remedy should then have been followed by the issue of court proceedings. The aims of the practice direction are (1) to enable disputing parties to settle the issue between them without court action and (2) if proceedings cannot be avoided, then to support efficient management of such action by the court. Courts are not happy when the process is not followed, and if you do defend, that’s a point to you. See full list of Civil Procedures Rules here.
    On a matter of principle, I would say he proposed a solution which didn't work, and he should take it on the chin and move on. Bodge-It comes to mind. On the other hand, he has spent time/effort/money, so maybe he should be paid something – question is, how much? That is where the negotiation comes in. You could try using ADR (Alternative Dispute Resolution) – the court will have a list of practitioners. But again it costs. Last time I looked, it was about £500.
    I'd get him on the CPR thing. If he has to re-issue in your Missus name, then he has to start all over again.
    On the other hand, he may be trying it on, and wanting to scare you into paying up, in which case you can respond to the court papers immediately and dispute it – or ask for extension to 28 days to give you time to put your defence together.
    As an example, I had a commercial tenant who tried to do that to me – he had made a claim to his insurance company (for malicious damage to the building and contents), which after investigation was turned down, and in the meantime he was not trading or paying rent. Our insurance only covered buildings and loss of rent for part of the time of non trading. We eventually recovered the property and he tried to sue me for costs he claimed had spent on refurbishing the place, stuff still in it etc.etc. No notice whatsoever-just court papers. I defended it, of course, seeing as he owed me money. Unfortunately for him, the value he was claiming meant it had to go multi-track, and there were allocation papers to complete and fees to pay, which he obviously wasn’t prepared to pay. I have on my wall here court judgement saying case was struck out because he failed to follow through. As a scare tactic, it didn’t work on me (I had bigger bullies on my back at the time). As a time wasting exercise, it was undoubtedly unwanted and an irritant.
    Up to you to make a judgement.
    One thing I have also found is that even if a CCJ is issued, it does not show on a credit file of the Defendant until the claimant tries to enforce it. That’s what I’ve found with the S8 CCJs anyway. Which is why I am on a vendetta to enforce any S8 judgement I’ve got from the courts.
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    .
    The profit of knowledge is in its application
    TumiHawkins.com
    Tumi,
    A word of warning on relying on CPR as defence. The small claims court is in some resepcts designed to serve the man in the street and depending on the viewpoint of the Judge, citing lack of application of CPR procedure can work in a negative way.
    I have found from experience that being correct in terms of procedure in a hearing, even when the other party is woefully inept by comparison, there is nothing better than compulsive evidence.
    It is clear from Anil's original post that a contract was formed. The problem arises on the basis that it was verbal and comes into the "he said, she said" domain.
    After a brief chat on the phone, a site visit was arranged. I met the gentleman and walked him to each of the properties, talking about layouts, siting of routers etc etc. At this stage I had two requirements: A, all equipment would need to be in communal areas in case of resets and the provision of the internet should be on demand, regardless of which property or which part.
    At this point I was assured that this was an easy type of problem to be fixed. The solution being a cental router in house B, with range extenders in houses A and C.
    The equipment was ordered and the installation date arranged.
    From this extract of the original post, IMHO it is clear that a contract for services was made between Anil and the tradesman. My further opinion is that the Tradesman would be entitled to recover the reasonable cost of all of his time for sourcing, installing etc. the equipement and for the capital costs of the equipment subject to a further adjustment for overheads and profit.
    Anil may however have a counter-claim for a breach of contract in so far as the services were not executed to an acceptable standard. It could be argued that the issue of the walls etc. should have been know and understood by Anil as a professional property manager/landlord. It would really depend on the Judge on the day and how compelling the evidence.
    Put it this way, I'm pretty game for fighting a legal battle in person but wouldn't fancy this one too much without being certain that the Claimant was self-representing also.
    I feel that the most equitable solution would be to negotiate a compromise.
    Anil, I suggest that you obtain a breakdown of the claim if you don't already have one. I have a useful document that can be adapted to use for defence of claim when the details are vague and would be happy to share this with you if you PM or email me.
    Rob
    Sourcing genuine property deals in Wakefield and The Five Towns
    Follow me on Twitter @walkerfox
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    Email rob@walkerfox.co.uk
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