Please Note: This Article is 6 years old. This increases the likelihood that some or all of it's content is now outdated.

David Carter of the Sheriff’s Office writing in his regular e-newsletter about the Tenancy Deposit Protection regulations, warns of problems to come.

Since April 2007, all residential landlords letting assured shorthold tenancies have had to protect any deposit paid. But the Court of Appeal in Superstrike Ltd vs Rodrigues ruled that this could also apply to tenancies that ended before the scheme even started, and the Court of Appeal’s decision in Charalambous vs Ng confirms this.

Under the amended rules of the scheme, within 30 days of taking it, a deposit must be registered in an authorised scheme and the landlord must give the tenant (or the person lodging the deposit) the prescribed information about how it is held. If this is not done, the landlord cannot serve a valid

Section 21 notice to re-gain possession when the tenancy expires.

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If the tenancy is renewed (and this includes when the tenancy automatically becomes a statutory periodic one, where the tenancy is not renewed for a further fixed term), the landlord has to make sure the deposit stays protected (virtual renewal) and give the tenant the prescribed information again, within 30 days of the new tenancy.

It’s very important for landlords and their agents to get proof of service when the prescribed information is served; otherwise if the tenant denies ever having received it, any notices served will be deemed invalid by the courts even if the deposit was correctly protected.

It was assumed by many landlords and agents that tenancies before the scheme started and continued on a periodic basis were exempt. Not so.

The rulings mean that a deposit must still be protected or paid back to the tenant before a Section 21 notice can be served, even if the deposit did not need to be protected at the time it was given.

Review your deposits and take the appropriate action now.

Please Note: This Article is 6 years old. This increases the likelihood that some or all of it's content is now outdated.
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2 COMMENTS

  1. Can anyone please advise, i\’m ill with worry over this!!
    Firstly, i\’ve never rented or have rented out a place before. The current Tenant was a first and will most definitely be my last!!! I have been extremely naive…
    My Tenant is DSS & at first i didn\’t want to take her on. She convinced me that all would be fine (yes, completely naive of me) & as she was very nice & a neighbour knew her i agreed. She said that the \’deposit\’ would be mine to keep, to call it an incentive, a gift for allowing her to live in my flat. We signed a mini contract stating that under no circumstances would it be returned. The AST started July 1st 2013. I had no idea that a deposit had to be put in a scheme & as it was myn to keep i gave it little thought. She was a problem from the start. Late rent, no contact etc. In June 2014, I threatened to give her her notice unless i was paid up to date and the Council paid me direct. It was then i found out that if i issued her the S21 I would need to secure the deposit. I did, just under a year after the Tenancy started. As the Council agreed to pay me direct i let her stay on. She always knew that my intention was to sell the flat within 2yrs as me and my partner wanted to buy in Deal, Kent. The rent is my MAIN source of income and i make nothing from it after paying the mortgage and my bills. I am NOT a Landlord in the professional sense and this is my only home.
    To bring you up to speed… I told her in Jan of this year that the flat would be going on the market early Feb. She was fine and said she would start looking for somewhere to go (she\’s a single mum with a 6yr old). She also said she\’d show potential buyers around so i had no reason to believe she wouldn\’t go but it was at the back of my mind… I accepted an offer on April 2nd. As a caution i had already served her the S21 on Feb 1st to expire March 31st. All this time passed and as the sale progressed she asked i we could go on a rolling \’month by month\’ basis until i had exchanged. She said she had a place to go to in May. I agreed, foolishly. The new date for her to vacate was June 1st. I had tried to contact her weeks before but nothing. Both her mobile and landline had been cut off. I knew then my worst fear was coming true. She never left. By then I had applied or a Court Order. She of course in her defence statement based staying on \’Extreme Hardship\’ I realised the Council only house her WHEN she\’s been evicted!!!!! The court rejected by S21 as i was out by 1 bloody day!!!!! I\’m devastated!!!! The only thing she did do was allow the deposit to be returned to me a few days prior to June 1st. I have now issued her another S21 & re-protected the deposit as she didn\’t leave. This is what i need advice on. Have i done the correct thing? I cannot risk getting it wrong again!!!!! I will probably lose my buyer as a result anyway.
    Someone please help me!!!! I\’m ill with worry!!!
    Thanks Jen 🙁

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