An agent has been expelled from the newest of the redress schemes and could now find it impossible to remain in business unless it pays the sum ordered.

Jordan Residential, in South Croydon, has been expelled by the Property Redress Scheme.

There is a memorandum of understanding between the redress schemes that agents will not be able to join any of them until the terms of the decision have been met. Agents cannot legally trade without membership of a redress scheme.

Jordan Residential was expelled after failing to make an award of £612.80 to a complainant. If it does not pay this, it will not be able to join either of the other redress schemes. If it does pay, our understanding is that it can join either of the other two schemes or have its membership of the PRS reinstated.

The expulsion follows a complaint from a prospective tenant about a holding deposit.

The complainant had viewed a property advertised by Jordan Residential as three bedrooms. When the tenant arrived, it transpired that the property only had two bedrooms and a converted lounge.

The tenant claimed to have felt rushed and pressured and paid £600 without the reason for this deposit being fully explained and whether or not it was refundable.

Upon reflection, the tenant decided they were unhappy with the arrangement and informed the agent within 24 hours that they were only prepared to accept the property at a lower market rent based on two-bedroom property rentals in the local area.

Jordan Residential verbally refused the offer and did not enter into any further correspondence with the tenant.

The tenant sent two letters to the agent by recorded delivery in an attempt to resolve the issue but her communications were ignored.

The complaint was raised with the Property Redress Scheme and the head of redress deemed that retention of the tenant’s holding deposit in this situation was unfair because:

• The tenant pulled out of the tenancy before the relevant costs covered by the holding deposit had actually been incurred by the agent.
• The agent had not yet taken the property off the market so the landlord had not suffered any loss by the property being held.
• The property did not conform to its description.

Jordan Residential was told to pay £612.80 to the complainant in lieu of the holding deposit and recorded delivery costs.

The PRS said that Jordan Residential had not paid the award, not acknowledged the complaints process, nor attempted to deal with the matter.

The PRS said it has received no communication or evidence from the agent and they have also failed to pay the advertised complaint subscription fees to the scheme.

Jordan Residential had their membership suspended pending further investigation by the head of redress.

His recommendation to the PRS board has been ratified.

Sean Hooker said: “Failure to pay an award, however large or small, is a serious breach of our terms of reference. Agents must not assume that the complaint will go away if they remain silent and refuse to engage with the scheme.”