Tenant Deposit Protection Case Law
R (Tummond) v Reading County Court and Another  EWCH 1039
With regard to serving s21 notices and protecting tenancy deposits, general practice has been to wait until the tenancy deposit scheme requirements have been complied with before serving a s21 notice, meaning that protecting and serving the statutory notice must have been complied within 30 days of receipt of the deposit.
However, in the case of R (Tummond) v Reading County Court and another  EWCH 1039, a tenant challenged a landlord in court because a s21 Notice had been served before the deposit had been protected. The challenge from the tenant (Mr Tummond) centered on s215 (1) of the Housing Act 2004 (sanctions for non-compliance) which states: ‘If a tenancy deposit has been paid in connection with a shorthold tenancy, no section 21 notice may be given in relation to the tenancy at a time when (a) the deposit is not being held in accordance with an authorised scheme, or (b) the initial requirements of such a scheme (s213 (4) have not been complied with in relation to the deposit.’
So, because the deposit was not officially protected until after the s21 notice was served, the tenant argued it was therefore invalid.
The High Court judge however disagreed because as the tenancy agreement specifically stated that the landlord was contractually obliged to protect the tenancy deposit in an authorised scheme within 30 days of receiving it, and as the landlord had fully complied, she could be deemed to ‘hold the deposit in accordance with an authorised scheme’ from the time it was received. Therefore the s21 Notice was valid.
Note: the overview of this case was sourced from issue 49 of the Landlord & Buy-to-Let Magazine by Tom Entwistle.
Charalambous and Another v Ng and Another  EWCA Civ 1604
The following cases are sourced from the Property Tribes website page: ‘The PRS – Summary of Legislative Changes’.
Under s31 of the Deregulation Act, (non-compliance with tenancy deposit requirements) the decision made in the Court of Appeal case of Charalambous and Another v Ng and Another  EWCA Civ 1604 is set into statute. Namely, that where the landlord received the deposit prior to the coming into force of the tenancy deposit legislation on 6 April 2007 in respect of a tenancy which began before that date, and which has continued without renewal since before that date, landlords will need to protect such deposits if they wish to be able to rely on the no-fault ground for possession in s21 of the Housing Act 1988 at the end of the tenancy. However, landlords in this situation will not be subject to any fines should they fail to protect deposits.
Superstrike Limited v Marino Rodrigues
The Deregulation Act 2015 also provided an immediate amendment of the law in relation to tenancy deposits due to a flurry of cases following the decision made in Superstrike Limited v Marino Rodrigues 2013 which deemed that a statutory periodic tenancy was a new tenancy, not a continuation of the existing one as was previously believed. So, at the end of the fixed term the Landlord/Agent was deemed notionally to have returned the deposit and then re-received it so the deposit protection rules began again. This meant requiring the re-protecting and re-serving of prescribed information for deposit protection under Chapter 4 Tenancy Deposits ss212 to 215 of the Housing Act 2004 which in turn was amended by s184 of the Localism Act 2011.
This meant that:
- A deposit must be protected within 30 days rather than 14;
- The tenant and any other person who provided such deposit must be given the prescribed information within 30 days (rather than 14) which should be localised to the Tenancy Agreement. The Deposit Schemes clearly state in their Terms and Conditions that they do not issue all the required Prescribed Information and reiterate it is the Landlords responsibility to comply.
- A s21 notice may not be given where a deposit has not been protected within the 30 day period. A Notice to Vacate under an Assured Tenancy would also be rendered invalid.
The amendments to the Deregulation Act 2015 are as follows:
- If the deposit was received before 06 April 2007 and went period before 06 April 2007 then the position set out in Charalambous v Ng continues to apply (see above);
- If the deposit was received before 06 April 2007 but was renewed or went periodic after 06 April 2007 and the deposit was not protected then landlords were given 90 days from 26 March 2015 (or before the Court hearing to determine a tenant claim for compensation or to determine the landlord’s claim for possession under s.21, whichever is the earlier) to protect the deposit and serve the prescribed information;
- If the deposit was received after 06 April 2007, has been protected and the prescribed information served at the outset, as long as the deposit remains the same with the same scheme, the landlord will be treated as if he/she has complied;
- If the deposit has not been protected at all, the Act doesn’t change the landlord’s liability.
Under s32 of the Deregulation Act 2015, landlords had (in most cases), until 23rd June to protect their tenant’s deposit or potentially face a fine. In cases where legal proceedings were already underway and the case was due to be determined before 23 June, the landlord would need to protect the deposit and send the prescribed information to the tenant prior to the date on which the court makes its determination. S32 of the Act also covers cases where a landlord ‘receives’ a deposit on or after 6 April 2007 (which could be at the start of a brand new tenancy or at the start of a renewed tenancy) and subsequently protects that deposit and sends the required information to the tenant. If the tenancy is subsequently renewed or rolls over into a statutory periodic tenancy, then so long as the deposit remains protected in accordance with the same authorised tenancy deposit scheme from one tenancy to the next, there is no requirement for the landlord to re-send the same information to the tenant each time the tenancy is renewed or rolls over: the landlord will be treated as having complied with the tenancy deposit protection requirements afresh at the start of each new tenancy.
This applies not just to the first ‘renewal’ of the tenancy but also to cases where there are multiple tenancy renewals, which could include a mixture of fixed term tenancies and periodic tenancies. Under s30, (provision of information by Agents) the Act also makes retrospective amendments to the Housing (Tenancy Deposits) (Prescribed Information) Order 2007 to make it clear that each of the references to “the landlord” in the order are to be read as references to either the landlord or the letting agent where relevant.