COMMERCIAL DEPOSITS UNDER INVESTIGATION

Who held your money? Who received the interest? And was your deposit returned?

Thousands of pounds may have been paid in commercial rent deposits by businesses occupying Flexspace premises across the United Kingdom.

But important questions deserve answers.

Where were these deposits held? Were they kept in designated accounts? Did they earn interest? If so, who benefited from that interest? And were deposits returned in accordance with the original agreements?

Ripped Off by Flexspace? is gathering evidence from former and current tenants to investigate these questions.

We are particularly interested in hearing from businesses that paid deposits several years ago, never received interest, faced disputed deductions or had their deposits withheld after vacating their premises.

The Royal Institution of Chartered Surveyors (RICS) is one of the UK’s leading professional bodies for property and surveying.

Its Code for Leasing Business Premises in England and Wales, Section 3.2, sets out a recommended approach to commercial rent deposits.

The RICS standard recommends that rent deposit agreements provide for deposits to be held in designated bank accounts used only for rent deposits, with any bank interest accruing for the tenant.

This is a recognised professional standard, not a universal statutory requirement that every commercial landlord must pay deposit interest.

Nevertheless, it raises important questions about how commercial landlords administer money provided by tenants as security.

We want to establish:

• Whether Flexspace tenants were informed where their deposits would be held.
• Whether deposit funds were held in separate, designated bank accounts.
• Whether deposits earned interest during the tenancy.
• Whether agreements entitled tenants to that interest.
• Whether any interest due was properly accounted for and paid.
• Whether deductions were contractually permitted and supported by evidence.
• Whether deposits were returned within the agreed timescale.

These are questions our investigation seeks to answer. They are not findings that Flexspace acted unlawfully.

This is one of the central questions of our investigation.

When a commercial tenant pays a deposit, the legal arrangements governing that money should be established by the relevant agreement and any applicable legal obligations.

Depending on those arrangements, tenants may be contractually entitled to interest earned on their deposits.

We want to hear from tenants whose agreements provided for interest but who believe they never received it.

We are also interested in hearing from tenants who were never informed how their deposits were held or whether interest accrued.

We intend to collect tenancy agreements, deposit receipts, correspondence and statements to determine whether any recurring issues exist.

Where evidence reveals money legally owed to former tenants, we intend to seek independent legal assessment of the available recovery options.

Interest is only one aspect of our investigation.

We are also examining reports from former tenants concerning disputed deposit deductions and financial demands when vacating commercial premises.

Questions include:

Were deductions properly justified?

Did tenants receive written explanations, invoices, photographs or other evidence supporting charges?

Were contractual conditions followed?

Were deductions consistent with the original agreement and any deposit deed?

Were restoration charges reasonable and properly supported?

Were businesses charged for work that was unnecessary, disputed or outside their contractual responsibilities?

Were outstanding balances correctly calculated?

Did tenants receive a clear reconciliation showing the deposit paid, deductions applied and any remaining balance?

Were deposits returned when legally due?

Were tenants required to pursue repayment repeatedly or prevented from recovering funds without adequate contractual justification?

We are gathering information from current and former Flexspace tenants across the United Kingdom.

Our aim is to establish whether reported concerns about commercial deposit administration are isolated incidents or form part of a recurring pattern across locations and over time.

We are interested in historical agreements, including arrangements entered into before the current RICS leasing standard took effect.

Older agreements will be assessed against their own contractual terms and the law and professional guidance applicable at the relevant time.

If you occupied a Flexspace office, workshop, industrial unit or other commercial property, your experience could help establish the facts.

We are working to bring together former and current Flexspace tenants and assemble an evidence base suitable for independent legal examination.

Our intention is to identify potential breaches of contractual duties, determine whether deposits or interest may be recoverable and establish whether coordinated civil proceedings may be justified.

We are seeking appropriate legal professionals to evaluate the evidence and advise on remedies available to affected businesses.

Where claims can be substantiated, our aim is to support tenants in pursuing money legally owed to them and any additional remedies available under the law.

TOGETHER, WE ARE WORKING TO BUILD A LEGAL TEAM TO CHALLENGE FLEXSPACE’S BUSINESS PRACTICES.

Every relevant agreement, deposit receipt and documented experience could help establish whether further legal scrutiny is warranted.