Late tenancy deposit protection fines

Late tenancy deposit protection fines

8:54 AM, 11th February 2014, About 8 years ago 72

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I spoke to someone on the NLA helpline this morning who told me that the law is unambiguous – landlords registering deposits later than one month after receipt are liable to be sued for three times the deposit amount.

Looking online, I am unable to find definitive reference to this, and, most importantly, how are courts tending to implement this?

Are landlords being being subjected to these levels of punitive damages?

Can anyone help me with this? Late tenancy deposit protection fines

I am interested to know primarily how this is working out in practice. I would imagine that if it were the case that tenants absolutely have the right to 3X the deposit amount in the case of late registration, there would surely be an epidemic of lawsuits going on right now?

Do you have any direct, recent experience of how this is being implemented or have no cases yet come to court under the new rules yet?

Thanks in advance.


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by Romain Garcin

18:09 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Scott 44 " at "13/02/2014 - 15:59":

If tenancy started on 26/5/11 and hasn't ended yet, then I think the cause of action would have arisen on the 31st day after 26/5/11.

by Mark Alexander

18:13 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Romain " at "13/02/2014 - 18:04":

Perhaps I misunderstood what you were trying to say when you wrote .....

"whenever the contract to create a new tenancy is signed, the deposit is held in relation to the existing tenancy until that tenancy is replace by the newly agreed one."

by Industry Observer

18:13 PM, 13th February 2014, About 8 years ago


I agree with all your recent posts and your responses to the comments on those posts.

I really and truly do not understand why people seem to find such difficulty with all this. I understand why people don't like it, but what they find so difficult in understanding and implementing it I do not know.


My opinion is of course just that, but there is a massive difference in that I base my opinion on the Law and the Cases that interpret it. S5 of the 88 Act has always said a periodic tenancy was a new tenancy the wording is there for all to see.

Others seem to base their opinion on how they would prefer things to be, having first criticised the decisions as being anything from silly to irresponsible.

As I have told you off piste, don't hold your breath for legislative changes. They may come it makes no odds to me whether they do or not and in some ways I hope they do, at least for clarification.

But I fail to see where they are going to come from.

by Mark Alexander

18:27 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Industry Observer " at "13/02/2014 - 18:13":

I base my opinion on the fact that Mary Latham was a party to the consultation prior to the drafting of the legislation and also that her understanding of what was meant was the same as the housing minister Mark Prisk, who said in the wake of Superstrike .... and I quote ....

"I am aware that this ruling has implications in respect of the tenancy deposit protection (TDP) legislation and the operation of the tenancy deposit protection schemes. There are concerns that the Court of Appeal decision means that where a deposit was taken for an assured shorthold tenancy before the introduction of TDP and continued as a statutory periodic tenancy after 6 April 2007, the landlord should have protected the deposit at the start of the statutory periodic tenancy. This was not the intention of the legislation and we are urgently exploring whether new legislation is required to clarify the situation.

I understand that concerns have also been raised that the decision could have implications for some tenancies where a deposit has been protected in an authorised scheme in relation to a tenancy begun after 6 April 2007 and the fixed term has expired, and the tenancy continues as a statutory periodic tenancy. While the Court of Appeal did not make a decision on these particular facts and we cannot advise on individual cases, as a precaution, landlords could decide to re-issue the prescribed information to their tenant(s) which should ensure they can rely on the section 21 procedure if they wish to end the tenancy. Again, we are exploring whether new legislation is required to clarify the situation.

Best Wishes,

Mark Prisk MP”.

by Romain Garcin

18:35 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Mark Alexander" at "13/02/2014 - 18:27":

Well whatever the intention was, clearly it was not expressed in the statute.
Personally, I think that the Superstrike decision is correct considering the way the act is drafted: all the requirements are stated as applying to a single tenancy.

I don't know what the original intention was. It would make sense to protect the deposit only once when actually paid to cover any number of replacement tenancies until the tenant leaves and requests the money back.
This would require drafting the statute very differently.

by Mark Alexander

18:39 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Romain " at "13/02/2014 - 18:35":

Not according to David Smith at Anthony Gold solicitors. He reckons one word "AND" could change the entire legislation to what was actually intended.

A lot of water has passed under the bridge since I had the conversation with him I'm afraid so please don't ask me to recall exactly where the "AND" is needed because I can't remember now.

by Romain Garcin

18:47 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Mark Alexander" at "13/02/2014 - 18:13":

I meant that if:
1. You have an existing tenancy A for which a deposit is held.
2. You sign a contract to create a replacement tenancy B at a later date. The contract states that a deposit must be paid for that tenancy (I'm assuming same amount as tenancy A to simplify).

1. The tenant actually send you the money for tenancy B's deposit. In which case that money must be protected within 30 days of receipt, and tenancy A's deposit must be refunded when that tenancy ends.
2. The tenant does not send you any money with the implied understanding that when tenancy A is replaced by tenancy B the deposit held in relation to tenancy A will be carried over to tenancy B instead of being refunded.

I think (2) is the common scenario both when a statutory periodic tenancy or a replacement fixed term tenancy arise. This is basically Superstrike, and the deposit for tenancy B is deemed received on the first day of that tenancy whatever the date the contract was signed.

by Industry Observer

18:52 PM, 13th February 2014, About 8 years ago

Mark Prisk - yes where is he now, another brilliant really effective Housing Minister?

About the 15th Housing Minister in the past 20 years from memory - says something about how high up the pecking order housing is regarded in any shade of Govt wouldn't you say Mark?

If the industry likes what Mark Prisk says presumably middle sentence second paragraph means all his devotees are serving and re-serving PI without question then?

by Mark Alexander

18:54 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Romain " at "13/02/2014 - 18:47":

I was with you right up until you said "This is basically Superstrike".

That's the part I contest.

Using your own analogy, the deposit for Tenancy A was not protected in the Superstrike vs Rodriguez case.

If there was, the outcome may well have been very different and it's that scenario which needs to be tested in Court, or better still, for legislation to be re-drafted to deal with a scenario where a deposit was protected within 30 days of the commencement of Tenancy A.

by Mark Alexander

18:57 PM, 13th February 2014, About 8 years ago

Reply to the comment left by "Industry Observer " at "13/02/2014 - 18:52":

The poor chap was never really given a chance, unlike his predecessors who had several chances and seemed to screw up at every given opportunity to do so.

In my opinion, what we need to solve the housing crisis is a housing committee, independent of government and politics, more akin to the Bank of England framework with targets set by government.

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