Can an agent refuse to provide tenant referencing reports to the landlord?

No – probably not…

Fiduciary relationship

The agent is contracted by the landlord to act on behalf of the landlord (the principal). Agents have what is known as a ‘fiduciary relationship’ with the landlord. Data collected, or artefacts created, by the agent in performance of the contractual obligations is collected or created on behalf of the landlord.

If the landlord signs a contract which specifically states that he will not have access to the tenant’s reference report, he will probably be bound by this but where the contract is silent, it is the property of the landlord as it was obtained by the agent for the purpose of the landlord’s property, in his capacity as agent for the landlord.

Data protection

Agents will sometimes argue that passing the reference report on will be in breach of the Data Protection Act. Guidance from the Information Commissioners Office (ICO) here states:

Can landlords see references which were provided to the letting agents?
The agent can pass this information to the landlord, as long as, when the reference is asked for, they make clear to the tenant and the referee that this will happen.

This ICO guidance is not entirely consistent with the opinion of many legal experts who see passing on the reference report as an automatic right as the agent is an extension of the landlord.

Duty of obedience

An agent has a duty of obedience – express instructions are paramount and this duty takes precedence over the duty to exercise all reasonable care and skill.

Tenant referencing reports belong to the landlord not the agent and the agent should not disobey the landlord’s instructions to provide them.

Why a landlord should see reference reports

There are two important reasons why the landlord should be entitled to see the reference reports if he wishes, before the tenancy is granted:

1. Landlords can suffer massive losses through bad tenants being allowed into their property, both through unpaid rent and through the tenant damaging the fabric of the property itself.

2. The landlord may want to check that the agent has carried out any referencing at all. Sadly, it is not unknown for agents to pocket the reference fees and not actually obtain references. There have been many cases where the referencing carried out was grossly inadequate for the type of property being let and as a result the landlord suffered great losses (see Saul Shevlin v. Sequence (UK) Limited below).

If the agent is able to say “sorry, we can’t tell you anything about the references we have because of the data protection”, how can the landlord be sure that this important part of the agent’s job has been done properly?

Saul Shevlin v. Sequence (UK) Limited

This case heard in June 2016 in Colchester County Court found Sequence to be negligent as they had referenced a (bad) tenant and granted a tenancy, refusing to pass on the reference report to the landlord (they had done so previously). The landlord approached the company commissioned to carry out the referencing directly and was emailed the report. The reported highlighted a number of ‘red flags’ which the agent should have investigated.

This case is interesting with regard to this topic question because a). the company who were commissioned to compile the reference report provided it to the landlord directly after the agent refused b). had the landlord been provided with a copy of the report when it was first compiled, the tenancy would almost certainly not have been granted.

Advice for landlords

Make it very clear, when you instruct an agent, that you will want to see the reference reports, before the tenant’s application is approved.

Make it clear to the agent that it is the agent’s responsibility to take such steps as are necessary (i.e. tell the tenants and the reference company) in order to prevent their being in breach of data protection legislation in passing reference reports to the landlord.

Further Reading

Landlord wins long-running case against agent after tenancy went wrong (Property Industry Eye article)

Can an agent withhold part payment of 6 months rent in advance?
(Jungle Property blog article)

Are landlords entitled to see tenants references obtained by their agents? (The Landlord Law Blog article)

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