Government to step in to resolve Deposit Protection ambiguityMake Text Bigger
At last it seems that common sense will prevail in Westminster.
Last year the Court of Appeal ruled (in the case of Manual Rodriguez vs Superstrike Limited) that statutory periodic tenancies are indeed new tenancies . This cast a shadow over interpretation of the law and whether or not new deposit protection prescribed information needs to be served when a fixed term tenancy ends and automatically rolls over to being a statutory periodic tenancy.
This ambiguity resulted in a state of panic for landlords and letting agents and sent their representative bodies into a spin given that consensus of opinion and most associated advice was that once a deposit was protected that was all that was required. The Superstrike case cast doubt over whether a tenant could claim compensation equal to the deposit plus three times the deposit for failing to serve prescribed information again within 30 days of a tenancy becoming a statutory periodic tenancy.
Ministers acknowledged the issue relatively quickly and agreed that the drafting of the legislation upon which the Court of Appeal had ruled was indeed ambiguous and not as intended, hence they committed to legislating to correct the situation
Much of the progress of the Deregulation Bill through parliament has already taken place and while the amendments will first need to be agreed by both Houses it is unlikely to meet too much resistance.
If passed, the changes in legislation will mean that all landlords with tenancies that commenced post April 2007 and which were originally compliant with deposit protection legislation will be deemed to have complied.
A 90 day amnesty is proposed for landlords who have tenancies commencing pre April 2007, and which have become periodic and for which a deposit is still held, following commencement of the legislation in order to protect the deposit and serve the appropriate prescribed information.
For all tenancies that have ceased or where a deposit is no-longer held, it is proposed that landlords will be deemed to have complied.
— Mark Alexander (@iAmALandlord) June 20, 2014
— Property118.com (@Property118) June 20, 2014
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