Securing a tenant’s deposit is a pretty run of the mill process for landlords these days. Nothing new there; seems pretty straight forward; you secure your tenant’s deposit online, perhaps simultaneously watch a little bit of porn to fill in the page-loading blanks, job done.
Sadly, the golden days are only but a distant memory. Times have changed, and the Captain runs a tighter ship. I recently secured a tenant’s deposit and there was quite a bit of hoop-jumping required in order to stay on the right side of the law. Actually, I can only pray I did enough- it’s hard to tell these days. You give and you give, but they keep wanting more. Sounds a bit like my wife. Although I’m not actually married, but I imagine that’s what married life is like.
And… that’s probably why I’m not married.
Being a landlord is already convoluted enough with all the bullshit legal obligations and junk, so it became even more frightening when the powers that be, recently reconfirmed how unforgiving they can be. All landlords should already know that protecting their tenant’s deposit into a tenancy deposit scheme is a legal requirement. Alas, protecting it and informing tenants which scheme is used is only fulfilling half the landlord’s legal obligations regarding tenancy deposits. The Powers want more. There’s an entirely separate counter-part process that comes after protecting the deposit which is just as vital, but often neglected.
A recent Court of Appeal decision imposed the maximum penalty on a landlord (3 x the deposit amount) because he DIDN’T provide ALL the prescribed information relating to the protection of the deposit to the tenant. According to the law, the landlord must provide all the prescribed information to the tenant within 30 days of receiving the deposit money as required by the Housing (Tenancy Deposits)(Prescribed Information) Order 2007.
Now, this isn’t a newly imposed law, the legal obligation for providing the tenant with ALL the prescribed information has been required for a while, but until now no one has been, or at least, only a limited amount of tenants, have been brain-numbingly petty enough to attack that angle. It would be like reporting someone for placing a postage stamp bearing the British monarch upside-down. Believe it or not, that is an act of treason. But who would seriously complain against that nonsense?
What is the Prescribed Information?
This is key information relating to the deposit protection including details about the deposit, the scheme used to protect it, instructions about disputes and key contact information. The legislation says the following information should be provided as part of the PI:
- 2.—(1) The following is prescribed information for the purposes of section 213(5) of the Housing Act 2004 (“the Act”)—
- (a)the name, address, telephone number, e-mail address and any fax number of the scheme administrator(1) of the authorised tenancy deposit scheme(2) applying to the deposit;
- (b)any information contained in a leaflet supplied by the scheme administrator to the landlord which explains the operation of the provisions contained in sections 212 to 215 of, and Schedule 10 to, the Act(3);
- (c)the procedures that apply under the scheme by which an amount in respect of a deposit may be paid or repaid to the tenant at the end of the shorthold tenancy(4) (“the tenancy”);
- (d)the procedures that apply under the scheme where either the landlord or the tenant is not contactable at the end of the tenancy;
- (e)the procedures that apply under the scheme where the landlord and the tenant dispute the amount to be paid or repaid to the tenant in respect of the deposit;
- (f)the facilities available under the scheme for enabling a dispute relating to the deposit to be resolved without recourse to litigation; and
- (g)the following information in connection with the tenancy in respect of which the deposit has been paid—
- (i)the amount of the deposit paid;
- (ii)the address of the property to which the tenancy relates;
- (iii)the name, address, telephone number, and any e-mail address or fax number of the landlord;
- (iv)the name, address, telephone number, and any e-mail address or fax number of the tenant, including such details that should be used by the landlord or scheme administrator for the purpose of contacting the tenant at the end of the tenancy;
- (v)the name, address, telephone number and any e-mail address or fax number of any relevant person;
- (vi)the circumstances when all or part of the deposit may be retained by the landlord, by reference to the terms of the tenancy; and
- (vii)confirmation (in the form of a certificate signed by the landlord) that—
- (aa)the information he provides under this sub-paragraph is accurate to the best of his knowledge and belief; and
- (bb)he has given the tenant the opportunity to sign any document containing the information provided by the landlord under this article by way of confirmation that the information is accurate to the best of his knowledge and belief.
- (2) For the purposes of paragraph (1)(d), the reference to a landlord or a tenant who is not contactable includes a landlord or tenant whose whereabouts are known, but who is failing to respond to communications in respect of the deposit.
Ayannuga v Swindells
The case in question was Ayannuga v Swindells. In summary, the tenant allegedly fell into rent arrears, consequently the landlord sought possession. The tenant responded with a big “Fuck you” and decided to counter-claim against the landlord for not providing him with enough information about the secured tenancy deposit. Incidentally, if the deposit is not correctly secured and the correct information is not provided to the tenant, the landlord cannot serve a valid Section 21 notice, which means he cannot repossess the property from the tenant. That’s the tenant’s motive for being a turd right there.
It’s obvious what happened here- the tenant was clearly scraping the bottom of a barrel, looking for any old counter-claim to either delay possession and/or find any means possible of getting money out of the landlord instead. Turns out the tenant was scratching away in the right gloomy corner, because he managed to do both.
I’d be interested to know who assisted the tenant to make that counter-claim. A part of me despises the individual, the other applauds his/her… actually, no, fuck it, whoever helped the tenant is a moron. I know lawyers have a job to do, and they only follow the guidance of the law, but it leaves a bad taste in my mouth when they neglect the moral perspective, and purely focus rely on the law for greed.
I’ve read various articles that have already discussed this issue, and many people felt justice was served, and the landlord deserved to be made an example of (I’m sure some of you feel the same). While the landlord did fail to comply with the law in it’s entirety on this issue, the bigger picture is still relevant to me. Perhaps that’s besides the point, and clearly irrelevant in the eyes of the law.
If the landlord didn’t provide any information regarding the protection of the deposit, then that’s another issue. But as it turns out, the information that was omitted by the landlord was in fact publicly available, and could have been found easily by the tenant on their own. So I can only assume the landlord protected the deposit, told the tenant where it was protected, and provided them with a Deposit Submission Confirmation/Certificate (provided by the deposit protection scheme)… yet, miraculously, still fell short of what was required and managed to get prosecuted.
Now the question begs to be asked… did this particular landlord really need to be made an example of?
Unfortunately, this case may have opened the floodgates for many tenants to do the same thing, as I’m sure many landlords have failed to provide all the prescribed information, even while protecting the deposit. You can bet your bottom dollar on the fact that anyone that has the legal authority to advise tenants on how to prolong repossession will grab this lifeline, so it’s more important than ever for landlords to make sure they completely fulfill their legal obligations when it comes to securing deposits.
So what should you do after your tenant’s deposit is secured?
When you take a deposit from your tenant on an Assured Shorthold Tenancy (AST) in England and Wales you will need to Protect the deposit with a government authorised scheme with in 30 days of receiving the deposit. Assuming you have done that, you will then need to provide the tenant(s) with the Prescribed Information also within 30 days of receiving the deposit from your tenant.
Most deposit schemes are being helpful by providing landlords with “Prescribed information” download packs, which covers everything they should be handing over to tenants. I’ve put together a list of the information you should be serving to your tenants, along with the relevant download links depending on which deposit scheme you use. Each tenancy deposit scheme has its own rules setting out in detail how it operates.
|Scheme||Description||Required to be served to tenants|
|With Tenancy Deposit Scheme (TDS) you must give your tenant and any third parties who have contributed towards the deposit everything listed on the right.|
|If using DPS you must give your tenant and any third parties who have contributed towards the deposit everything listed.|
|If using MyDeposits you must give your tenant and any third parties who have contributed towards the deposit everything listed.|
I recommend checking the scheme’s website for the most up-to-date legislation and download links! What I have provided is merely a guide, which may eventually get out-dated.
Re-issuing Prescribed information and periodic tenancies
Please note… there was a time when the Prescribed information needed to re-issued when a fixed tenancy rolled into a periodic tenancy. Since the Deregulation Act 2015 was introduced, the rules have changed; if the tenancy rolls over into a new fixed term AST or a statutory periodic tenancy there is NO need to re-issue the Prescribed Information as long as:
- The deposit was properly protected and Prescribed Information served at the start of the original tenancy
- The property let remains the same
- The tenant(s) remain the same
- The landlord(s) remain the same
- The deposit protection scheme used remains the same
Source of above information: RLA
Prescribed Information Release Form
In light of penalties landlords could face if deposits are not secured and the correct Prescribed Information (P.I) being served, I have put together a Tenancy Deposit P.I release form, which I ask my tenants to sign. The form confirms that they have been provided with the Prescribed Information. You can download a copy by entering your name and email address below.
Disclaimer: I'm just a simple landlord blogger, I am not qualified to give legal or financial advice. Any advice I give is my opinion based on my experience, and is never legal or professional advice. You should always get professional advice on any legal and financial matters!