There are a number of prescribed requirements that a landlord must meet before they are able to issue a Section 21 Notice to their tenant. One such requirement is found within Section 213 of the Housing Act 2004, which stipulates that a landlord must protect a tenant’s deposit and provide the tenant with the prescribed information within 30 days of receiving the deposit. Since 6 April 2007, it has been mandatory for a landlord to join a tenancy deposit scheme on the creation of a new AST, where a deposit is paid by the tenant to the landlord on commencement of the tenancy.
What is a Section 21 Notice?
A Section 21 Notice is a notice under the Housing Act 1988, which a landlord must give to their tenant to initiate the process of taking possession of their property which is let on an Assured Shorthold Tenancy Agreement (“AST”). The Section 21 route is commonly referred to as a non-fault eviction because the landlord does not need to provide a reason for wishing to take possession of their property back from the tenant.
There are a number of prescribed requirements that a landlord must meet before they are able to issue a Section 21 Notice to their tenant. One such requirement is found within Section 213 of the Housing Act 2004, which stipulates that a landlord must protect a tenant’s deposit and provide the tenant with the prescribed information within 30 days of receiving the deposit. Since 6 April 2007, it has been mandatory for a landlord to join a tenancy deposit scheme on the creation of a new AST, where a deposit is paid by the tenant to the landlord on commencement of the tenancy.
It is important to note that even where a tenancy was entered into prior to 6 April 2007, then a deposit may still need to be protected. In the case of Superstrike Ltd v Rodrigues, the Court of Appeal held that where a tenancy deposit had been paid by a tenant in relation to an AST entered into before the tenancy deposit protection rules came into force, would still need to be protected, if the initial fixed term tenancy expires and the tenant remains in occupation under a statutory periodic tenancy
As most ASTs are entered into for an initial fixed term period before being renewed either by an express agreement or by allowing the tenancy to become a statutory periodic tenancy, then it is likely that the majority of current ASTs, where a deposit has been taken, will need to comply with the tenancy deposit protection rules.
What if a landlord has not protected the deposit within the requisite time frame or not provided the prescribed information to the tenant?
If the deposit was not protected within 30 days of it being received by the landlord, then the landlord will be unable to serve a Section 21 Notice on the tenant, even if the landlord takes steps to protect the deposit after the expiry of the deadline, because the landlord will have failed to comply with their obligations within the requisite period.
This will also be the case if the landlord does not provide the prescribed information to the tenant within 30 days of receiving the deposit.
To serve a Section 21 Notice in the above circumstances, a landlord will be required to return the deposit to the tenant in full before they can serve a Section 21 Notice. However, the landlord will be unable to rely on the accelerated possession procedure and will instead have to issue a standard possession claim once the notice period within the Section 21 Notice comes to an end. A landlord will have to prove to the Court that the tenant has received the deposit, and the landlord may encounter issues if the tenant declines to accept the deposit back.
If the tenant refuses to accept the deposit, then a landlord will be unable to serve a Section 21 Notice and a landlord will only be able to progress a claim for possession based on a Section 8 Notice, which can only be served if there are relevant grounds to do so.
Can a landlord face sanctions for failing to protect a deposit or providing their tenant with the prescribed information?
Under Section 214 of the Housing Act 2004, if a landlord fails to protect a tenant’s deposit, or provide their tenant with the prescribed information within 30 days of receiving the deposit, then the landlord is in breach of their obligations and as such, a tenant will be able to make a claim against the landlord for failing to comply with their obligations in relation to the deposit. The tenant will be entitled to make a claim for the return of the deposit, plus statutory compensation of between 1-3 times the value of the deposit. The Court has discretion as to what level of compensation they award to the tenant and will therefore take into consideration the circumstances surrounding the breach before deciding what compensation, if any, is due to the tenant.
How can Talbots Law help?
Our Property Dispute Resolution team has extensive experience dealing with evictions, both for landlords and tenants, so please do not hesitate to get in touch with one of our Landlord and Tenant specialists who will be happy to assist. Call our team on 0800 118 1500 or email [email protected]
DISCnzIMER
The contents of this blog or any other published by Talbots law cannot be considered as legal advice and should therefore not be acted on without prior consultation with a qualified solicitor or legal professional.
