Superstrike Ltd vs Rodrigues Tenancy Deposit Protection Court of Appeal

Surely when a tenancy comes to an end, that is in this case the end of a fixed term tenancy, the deposit should be reclaimed by the tenant. If the tenant fails to reclaim the deposit then that is his problem. The landlord does not take and therefore has no need to protect a deposit for the new SP tenancy.

Is this a too simplistic view?

@David Price - as I said in my article, your suggestion would be the basis of at least one of my arguments if a tenant were to take me to court based on this ruling.

The Court of Appeal dismissed the possession claim because the deposit had NOT been protected. A deposit was taken but not protected as deposit legislation was not in force at that time.

Coincidently, we have just received an automated email reminder from the TDS confirming that one of our fixed term tenancies has just come to an end and that if the tenancy is continuing on the same terms, etc, "You can now download a revised certificate, which reflects that the tenancy protection is continuing on a periodic basis. You should forward this to your tenant(s)."

I've just read the judgement. As an aside, the High Court cannot overrule the Court of Appeal - only the Supreme Court can.

I assume you got legal advice on the matter before writing the article? If you did, I'd get a second opinion. The case in question involves a tenancy whose deposit was never protected, rather than one that was being renewed. When it comes to applying a judgement on other cases this could be a crucial aspect in distinguishing. The law cannot work retrospectively, at least not without statutory intervention, so I would question whether or not this will suddenly unleash mayhem in the letting industry. Providing that deposits have been protected then landlords will have complied with s.213. The Court of Appeal seems to have ruled that you can 'receive' a deposit simply by circumstances changing i.e. the money doesn't have to change hands but if the circumstances do then, from a legal perspective, you have received the deposit and it must be protected. However, surely, by the same logic, s.213(3) would be complied with if the deposit is already protected. I am no longer a landlord, but when I was an found myself in a tenancy renewal situation a new thing from the TDS just arrived, presumably my agent had done something useful for a change, and that complied with the relevant statutory provisions. Similarly, when I was a tenant and renewed for a number of years I received a new TDS document. I can't see that this judgement really introduces anything radically new other than saying that if you had a tenancy before the protection scheme came into existence then any deposit taken in connection with that needs to be protected and if it isn't then you are liable. At least if I were constructing a legal argument using this case that's the rationale I'd be asking the court to apply.

Conspiracy theory. Could this be the catalyst required to justify a complete re-write of all landlord & tenant (and letting agent) legislation?

The case itself was based on very specific facts:

A pre 6th April 2007 tenancy, which then was not subject to the then deposit requirements, but had a renewal Periodic tenancy post 6th April 2007 which was.

It stated that the new tenancy (periodic) required the original deposit, which hadn't been registered, to be registered.

A massive leap and assumption has been made on this thread - which was not determined in this case.

That is that any deposits post 6th April 2007 that have been properly registered, need either to be re-registered, or have the Prescribed Information re-submitted when they become periodic.

This is not what the case states, nor it's determination.

I appreciate that the case does raise the question, but the answer as yet has not been provided by the courts.

To give tenancy agreements normal business efficacy, it is highly likely that should the matter be considered by the courts, then they will suggest that any properly registered original deposit and Prescribed information is carried over to the new periodic tenancy, and with the Prescribed Information deemed to have been already being served.

If this isn't decided in this way, then we'll all be in breach of our mortgages, the country will go bust and the last person left should turn out the lights 🙂

Mark, I have just spotted this on the Guild of Residential Landlords site.

As the statutory periodic tenancy is a new tenancy, the court held that in effect, the landlord had repaid the deposit to the tenant under the fixed term tenancy and then immediately the tenant had in effect paid a new deposit to the landlord for the new statutory periodic tenancy. This is the same as if a renewal had taken place:

Looks as if the landlords obey the laws of thermodynamics and cannot win.

Paraphrased the three laws of thermodynamics are
You cannot win you can only break even
You can only break even at absolute zero
You cannot reach absolute zero

After this ruling most landlords are close to absolute zero!

@ Jonathan and Glenn - I have read the Court of Appeal ruling in full many, many times I can assure you so I am confident that I know what it says and more to the point, the implications of what it says.

Do you agree that it says a Statutory Periodic is a NEW tenancy?

Do you agree that a NEW tenancy requires a deposit to reprotected within 30 days and that a deposit protection certificate and prescribed information needs to be issued to the tenant within that same period?

Have just spoken to My deposits who assure me that I do not need to protect statutory periodic tenancy. I also have it in writing on an email.
I have spoken to RLA who have heard nothing about this at all. They are looking into this now.