PP 2008/68

New provisions aimed at safeguarding residential tenants’ deposits came into force on 6 April 2007 in England and Wales. As a result, landlords that take a deposit in respect of an assured shorthold tenancy on or after 6 April 2007 must protect the tenant’s deposit within 14 days of the start of the tenancy using an approved deposit protection scheme. There are various sanctions for non-compliance. The county court decision in Harvey v Bamforth [2008] PLSCS 250 is one of the first cases to be decided under the new legislation. Mr Bamforth was the assured shorthold tenant of a property owned by Mrs Harvey. Mrs Harvey protected his tenancy deposit with one of the approved schemes within 14 days of the start of the tenancy, but neglected to notify the tenant that she had done so (as is also required by the legislation). Mr Bamforth soon fell into arrears with his rent. However, Mrs Harvey was forced to withdraw from possession proceedings because she had failed to notify the tenant that his deposit had been protected in accordance with the requirements laid down in the legislation. Mrs Harvey subsequently rectified her omission. However, during subsequent proceedings between the parties, the judge ordered Mrs Harvey to return the deposit and to pay the tenant a penalty (in the sum of three times the value of the deposit) for non-compliance with the legislation. Mrs Harvey appealed against the judge’s decision. She argued that she had provided the tenant with the relevant information before the proceedings were heard. She argued that the court’s power to order the return of a deposit and to require the landlord to pay a penalty arose only if the court was satisfied that the landlord had: (i) failed to protect the deposit within 14 days of the start of the tenancy; or (ii) totally failed to comply with the notification requirements set out in the legislation. The county court judge accepted Mrs Harvey’s arguments. He ruled that the punitive provisions in section 214 of the Housing Act 2004 differentiated between failing to provide: (i) the prescribed information to the tenant within the short period laid down by the Act; and (ii) the tenant with any information at all. The statutory sanctions for failing to comply with the notification requirements were triggered by non-notification, as opposed to late notification, of the prescribed information. Landlords will be relieved by this decision. However, it is important to note that this is only a county court decision and that, as such, it is not binding on other judges. Consequently, the safest course of action for landlords is to comply with all the requirements laid down in sections 212 to 215 Housing Act 2004, and in the Housing (Tenancy Deposits)(Prescribed Information) Order 2007. In other words, landlords must protect deposits paid by assured shorthold tenants and serve the requisite notices confirming that they have done so within 14 days of the start of a tenancy. Allyson Colby is a property law consultant