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EViS
03-10-2011, 18:44 PM
Does a tenant's deposit need to be protected within 14 days of it being received by the landlord? Or can it be protected at any time between when the deposit is received and before it is returned to the tenant?

I have always been led to believe that it must be protected within 14 days. However, I am unsure as to whether this is a law or merely a recommendation by the TDS?

Snorkerz
03-10-2011, 18:54 PM
Section 213(3) of the 2004 Housing Act states:

Where a landlord receives a tenancy deposit in connection with a shorthold tenancy, the initial requirements of an authorised scheme must be complied with by the landlord in relation to the deposit within the period of 14 days beginning with the date on which it is received.

Due to appeal court decisions, there is no effective sanction for late compliance.

The forthcoming Localism Bill will extend that to 30 days, but if a landlord fails to comply he will have a choice...
- Return he deposit; or
- Not be able to serve a section 21.

EViS
03-10-2011, 19:14 PM
Thank you for the reply. Now to complicate this a tad (sorry!).

The tenant was only able to pay 50% of the deposit when they moved in (this was protected). The landlord then agreed to let them pay £x each month towards their deposit until it reached the figure agreed to in the AST. This did not materialise and the tenant then refused to pay any more towards their deposit each month. 4 months into the AST, can the landlord now pay the tenant's first rent payment into the deposit scheme (which would equal the deposit total as per the AST), however this would essentially make the tenant 1 month in arrears on rent?

It looks like the DPS scheme has an option to select a date when the deposit is paid (and secured from), or will it still be possible to see the actual date of protecting the deposit?

Snorkerz
03-10-2011, 19:23 PM
No, if money was paid as rent, it IS rent. You can not 'create' arrears on the rent account.

Other than s21 you have no real way of enforcing a deposit once the tenancy has begun.

The tenant would get a confirmation from the scheme which would confirm when the deposit was protected.

EViS
03-10-2011, 20:20 PM
How would a s21 enforce a deposit when the AST has not yet expired?

westminster
04-10-2011, 00:05 AM
The tenant was only able to pay 50% of the deposit when they moved in (this was protected). The landlord then agreed to let them pay £x each month towards their deposit until it reached the figure agreed to in the AST.
Really stupid idea, as this would mean that each installment would have to be separately protected and the prescribed information given again each time. Apart from the hassle, it has the potential to create huge complications if wanting to apply for possession under s.21.


This did not materialise...
What a surprise.


4 months into the AST, can the landlord now pay the tenant's first rent payment into the deposit scheme (which would equal the deposit total as per the AST), however this would essentially make the tenant 1 month in arrears on rent?
Nothing to stop LL protecting the money and trying to argue this, but if it ended up in court the court might ask to see evidence that the rent payment had been taken as a deposit, not as rent. If the contract specified that the deposit was payable in installments this would obviously not assist the LL's case.

westminster
04-10-2011, 00:10 AM
How would a s21 enforce a deposit when the AST has not yet expired?
You can't 'enforce' a deposit, or make the tenant pay it after the tenancy has started.

Always insist that the deposit is paid in full, in cleared funds, before the tenancy starts (and also, obviously, the first month's rent in advance). No exceptions.

EViS
04-10-2011, 06:30 AM
Thank you for the replies. I appreciate I am myself in a pickle now, after 10 years of trouble-free renting, the first time ever I gave someone the benefit of the doubt, it has backfired on me!

I am going down the section 8 route, I issued a Notice (as per templates on this forum) 2 weeks ago on grounds 8, 10 and 11. However, this is only valid if the court accept that one month's rent payment was put towards the deposit. I do not have any concrete proof of this and it is merely being done to 'speed up' the process of having to wait for 2 months (or 1 month and 1 day). I take it there is a considerable risk the court could throw the case out because of this?


Really stupid idea, as this would mean that each installment would have to be separately protected and the prescribed information given again each time. Apart from the hassle, it has the potential to create huge complications if wanting to apply for possession under s.21.


This is also relevant to applying for a section 8 as I currently am (as the AST is only a couple of months in), correct? Or am I misunderstanding something here?

Snorkerz
04-10-2011, 13:40 PM
it has the potential to create huge complications if wanting to apply for possession under s.21.


This is also relevant to applying for a section 8 as I currently am (as the AST is only a couple of months in), correct? Or am I misunderstanding something here?

I think Westminster is refering to the fact that there would be (say) 12 individual deposits that would need protecting to prevent the s21 being invalid. Deposit protection isn't notionally an issue for section 8 - though I have heard of a case where the 3x deposit claim has been used as a counterclaim for s8 - thus removing the rent arrrears. IIRC, this was a county court case, so is not binding on other judges.