Tenancy Deposit Scheme

[Resoli]

Hi everyone,

I've had a post running (some good debate with Planner) about the implications of s.214 and how it allows landlords a 'get out of jail' so long as they comply with s.213(6)(a) - i.e. they can protect the deposit whenever they choose because once protected and a deposit certificate issued and given to the tenant, the grounds for 3x penalty are no longer valid.

Has anyone else noticed this? Anyone found a way around it yet?

Mr. Pipps, Ed posted earlier on page two about how action might not succeed under s.214 if the landlord protects or returns the deposit. Your post directed Ed to re-read s.214. I've spent a lot of time reading s.214 and I've got to agree with Ed, unless you can pursuade me otherwise (please do because I've been caught by the letting agent here!), the 3x penalty is applicable where either a) the landlord has protected the deposit, but outside the 14 days, and provided the certificate after protection, or b) has returned the deposit.

Mr. Pipps, you were quite strong in your condemnation of Ed, please provide evidence - quote the section and your interpretation - for your view. Hopefully, we can all debate it / reach a consensus on what it really means. Two heads, or in this case probably twenty heads, are better than one letting agent!

[RentedAndRankled]

I'm not legally qualified, but here's my take.

S214(2) states that the penalties in 214(3) & 214(4) "apply if on such an application to the court" the requirements have not been satisfied. Therefore there is a strong case for situation as at the time of the application to the court, and not at the time of the hearing, to be what controls the outcome.

That said, the UK courts as operate on a "Spirit of the law" principal, so a judge may take the spirit to be a penalty on LLs who refuse to comply with the requirements and may see a LL who has subsequently protected or repaid the deposit in full to be a LL who just made an honest mistake, but in these cases there is potentially grounds for appeal on the basis that the law may have been misinterpreted.

The procedure for an appeal is relatively quick and painless, but must be started as soon as possible after the judgement. If you're not happy about the decision and there is a point of law behind your disagreement with it, the best thing to do is ask for "leave to appeal" at the time of the hearing, the judge will then usually tell you if they beleive you have a reasonable case for appeal and may offer you some suggestions (such as "get a solicitors advice"). You should always rememember though that just because you don't like a decision it isn't automatically wrong!!!!

So in a nutshell, it's down to the judges, and although they can't use their discrestion where there is a clear breach and the LL has not protected the deposit at the time of the hearing, they may see a LL who has repaid the deposit in full or protected the deposit before the hearing takes place (i.e. the LL has complied with one of the two options the court has available to it under S214(3)) as having made a reasonable efforts to have resolve the issue, and not award in the tenants favour.

Now if anyone wants to debate the point, I'm sure that any debate will help tenants going to court in a similar situation as it will provide comments and arguments why the judge should award in their favour.

[Mr Pipps]

Hello Resoli

Thank you for your comments.

Your post made for rather interesting reading. And it sounds to me as if you have approached this matter by firstly quite willingly believing any old yarn that the first man in the street has offered to spin for you - and only then subsequently deciding to ask someone to assist you with the Law. For future reference, that is the wrong order to be dealing with such matters.


Firstly, allow me to point out that I am not required to prove anything to anyone. I am posting here simply to provide some much needed assistance to people like you.


Secondly, it is quite evident to me that you have not sought any professional legal advice in respect of this matter. I should remind you that I am not here to provide you with legal advice. However, I am happy to help you read and interpret the provisions of The Housing Act 2004, Part 6, Chapter 4. And I hope you will find this information useful.


Now, the Law. Let's start with The Housing Act 2004, s.212, on page 183 of the digital document. This section is simply concerned with identify terminology and setting out the framework which must be provided indirectly by the Government.


Section 213 is where it gets interesting:


Sub-section (1) states that a landlord must place a deposit in an authorised scheme 'as from the time when it is received'. I believe this phrase is very important for your purposes.


Sub-section (2) may be paraphrased to say - 'If he doesn't intend to put the deposit in a TDS, then he has no right in Law to ask for a deposit from you.'

Sub-section (3) provides the timeframe for the landlord to meet his legal obligations under section (1) - and this timeframe is stated as 14 days from the date on which he has received the deposit from you, as established in sub-section (1).


Sub-section (5) requires the landlord to inform you of the TDS arrangements that have been made.


Sub-section (6) places a timeframe on the landlord for furnishing you with this information - again within the same 14 day period starting on the day on which he received the deposit from you.


Sub-section (7) reminds us that a deposit may only be cash - not jewellery, a car or any other real or immovable property.


Sub-section (8 ) clarifies the term 'deposit', to our benefit.


Sub-section (9) points out that no party concerned can claim to have agreed either expressly or otherwise - ie 'without prejudice' - to the contrary.


Now let's move on to section 214 of The Act:


Sub-section (1) gives you the right to apply to the County Court if the landlord fails to meet any of his legal obligations under section 213 of The Act.


Sub-sections (1)(a) and (1)(b) point out that you or your legal representative may have cause to make such an application to the County Court where the landlord either fails to put the deposit in a TDS or fails to notify you of the TDS arrangements - in either case - within the same 14 day timeframe which starts on the day on which he received the deposit in cash from you.


Sub-section (2) provides that where either such circumstances arise, the matter must be dealt with as follows:


Under sub-section (3), the Court is required to order the landlord to return the deposit to you or your representative within 14 days of the court reaching its decision on the matter.


Under sub-section (4) the Court is also required to order the landlord to pay, in addition to the return of the deposit, a penalty of a sum equal to three times the amount of the deposit, within the same 14 day timeframe from the date of the Court's decision on the matter.


Sub-sections (5) and (6) are also useful to us, but less interesting for your purposes.

So, on the basis of the above, I cannot see how you can have possibly taken the understanding which you have expressed in your first post on this thread – ie that a landlord is somehow at liberty to protect a deposit outside of the 14 day timeframe prescribed in section 213(3).


I also cannot fathom how you can possibly believe that any part of section 214 or section 213(6)(b) allows the landlord to furnish you with any such information relating to TDS arrangements, and to furnish you with those details within the 14 day timeframe which is specified in section 213(6) as commencing on the date on which he received the deposit from you, whether or not those arrangements made either inside or outside the 14 day timeframe stipulated in section 213(3), and whether or not that information is provided in the prescribed form or in a form substantially to the same effect as such, as specified within section 213(6)(a). I cannot see how the provisions which you cite could possible allow a landlord to belatedly protect a deposit and thereby somehow comply with his obligations which stated expressly in section 213(1) and 213(3). The very thought of this is completely contradictory to the express provisions and the very spirit of this legislation. In Civil Law matters such as these, there is no such thing as a 'get out of jail free card' - the responsible party either met their legal obligations or they didn't. There is no middle-ground or room for manoeuvre.


These legal provisions were drafted by the Legislator and were intended to apply to straightforward situations where a tenant pays a sum as a deposit to a landlord at the time of signing a legal agreement to be bound by a the terms of an Assured Shorthold Tenancy arrangement, in advance of occupying the property.


If you are interested in reading more about why the Legislator deemed it necessary to introduce these provisions into the Housing Act, then may I suggest you read the following Explanatory Memorandum. Section 7.2 of that document probably sounds all too familiar to many tenants who have shown interest in this discussion.


I can scarcely comprehend the proposition that you may have genuinely only discussed this matter with the letting agent to date? If this is indeed the horrific truth, then you have got a lot of work to do if you have any hope of getting your case in order and succeeding in demonstrating your position in front of a Court of Law. For goodness sake - seek some legal advice! And more importantly - stop talking to people who are clearly feeding you false information.


Would you like to know why the letting agent would appear to have been so keen to have convinced you of anything other than the abundantly simple truth?

The reason is because, if your landlord entered into the lease with you via the letting agent, and the landlord contracted the letting agent to undertake what is often referred to as a ‘managed letting’, then in Tort the landlord would have the legal right to sue the letting agent for any penalty which he might be directed to pay in the event that the TDS obligations weren’t met and where the landlord can demonstrate that he should have been advised to have met those obligations. I would strongly urge you to keep this card very close to your chest throughout any and all proceedings which may follow for you.


I do hope you find this information suitably illuminating for your cause. I am always happy to qualify my position for anyone who cares to step up to the plate. I only ask that you be willing to talk Law, and not popular rumour or 'letting-agent-hearsay'.



The reason is because, if your landlord entered into the lease with you via the letting agent, and the landlord contracted the letting agent to undertake what is often referred to as a ‘managed letting’, then in Tort the landlord would have the legal right to sue the letting agent for any penalty which he might be directed to pay in the event that the TDS obligations weren’t met and where the landlord can demonstrate that he should have been advised to have met those obligations. I would strongly urge you to keep this card very close to your chest throughout any and all proceedings which may follow for you.


I hope you find this information suitably illuminating for your cause. I am always happy to qualify my position for anyone who cares to step up to the plate. I only ask that you be willing to talk Law, and not popular rumour or 'letting-agent-hearsay'.

Regards

Pipps

[Mr Pipps]

Dear RentedAndRankled

I'm afraid that the Legislation in point here presents no ambiguity whatsoever. Therefore, how do you suppose a Judge would have any reason to take a purposive approach as you suggest?

When presented with prescriptive legislation, a Judge will simply take the literal meaning. And there is only one possible meaning that can be taken from these provisions.

The wording of section 214(2) can only be paraphrased to read that - the Court will consider the matter, in the event of an application being made, on the basis of whether the requirements of sections 213(1), 213(3) and 213(6) were met - that is, whether the landlord protected the deposit within 14 days of receiving it and duly notified the tenant of these arrangements within the same timeframe.

Furthermore, do you know what the spirit of this legislation actually is here? Have you read the TDS explanatory memorandum? Have you read Hansard?

The spirit of the law, and the reason for the Legislator drafting this interesting piece of legislation, is to force all landlords to undertake the handling of a tenancy deposit in the correct and appropriate manner from the commencement of the tenancy and to the end.

Civil Law doesn't provide 'get out of jail free cards', or even discretion in such circumstances as where a landlord has meant well really, or even tried to cover his footsteps belatedly, once he found out what the sanctions would be if he didn't.


I’m afraid there can be no reason for Judicial discretion on this matter. The legislation is abundantly clear. Section 214(4) requires the Court to direct the return of the deposit and the additional penalty of three multiples. The only point that counts is whether the landlord met his legal obligations at that time or not.

Whilst I will agree with you that the Judiciary have a certain amount of discretion within their remit, they fortunately do not yet possess the magical power to invent contradictory legal provisions as they go along.

To anyone out there who’s confused by all this - just make sure you cite the relevant TDS law at your hearing and you should at least have a chance.

Regards

Pipps

[RentedAndRankled]

(I'm not legally qualified, so if you are then please state so and I'll bow to your experience).

First off I'm not sure how you can determine the legislators state of mind unless you were the legislator. Making assumptions about another persons state of mind when they were drawing up statutes is not the basis for a solid argument.

Secondly, S214 is the section governing the award, and S214(1) determines the conditions under which a claim can be made, so although other parts of the act may have been breached that may not be enough to qualify for the award.

Finally, you should remember the judge can refuse to award you costs on the grounds of unreasonable behaviour. So if you've not sent a letter before action, refused mediation on the allocation questionairre, and refused to comminicate with the LL to reach a settlement, then you may find that you're not getting your court costs back.

All that said, there are only two 100% certain ways for a LL to get out of the award, and those are;

- The start date of the tenancy was too early to be covered.
- The tenancy was not an AST (so check your agreement).

[Mr Pipps]

I’ll forgive you for not being legally qualified. Firstly, in brief, the Legislator and any associated parties must at various junctures outline the basis for their legislative proposals as a fundamental part of the enactment process. In the case of the Tenancy Deposit Order 2007, we are lucky enough to have the rather useful explantory memorandum, and I’m sure you’ll find it rather interesting once you read it. New legislation simply cannot be introduced without it’s requirement and worthiness having been sufficiently demonstrated to the Lords and for this information to be made publicy available.

Secondly, section 214(4) is specifically introduced within The Act with express reference to section 213. The preceeding section is therefore the only section that possesses any relevance to 214. In the event of an application to the Court, the requirement for the Court to order payment of the penalty turns solely on whether the provisions in sections 213(1), 213(3) and 213(6) were met at the time when the landlord received the deposit from the tenant. I really cannot see how there could be any other way to interpret section 214. It’s one of the simplest legislative provisions I’ve ever had the pleasure of reading.

Furthermore, a Judicial decision to not award costs is also one which can be appealed. There is absolutely no requirement under the Housing Act 2004 or any supposed expectation of conduct for the tenant to attempt to coerce or mediate with the landlord before legal proceedings commence. Nor would there be any basis in law for a Court to refuse a claim for costs in the absence of any such quite unnecessary endeavours.

[nelly.1880]

Hi
This is my first post.
I am using this to gain some info. I too have been having difficulty in gettting info from my letting agent (LA). i took out a tenancy on the 25th march 2008. There were various problems with the LA and the landlord (LL). Basically, the LL had breached the tenancy act and he knew this. I asked the LA to leave 3 months early, they agreed. They said the LL agreed to this. Stupidly, I didnt get this in writing and more stupidly, the LA didnt get this in writing from the LL.
So fast forward to 25th July and I move out, all agreed with the LA that if I leave the place in good condition, the deposit will be returned - normal practice. I was not aware of the Tenancy Deposit Scheme - but I am know!
So up to yesterday, I am trying to get this deposit back - the LL saying no because I moved out early. The LA saying I might not get it back because I never got it in writing. Even though I have witnesses to them saying I could vacate no problems.
I went to the Cit Advice/B and they told me all about the TD/scheme and by sound of it I am not in one.
I got the letting agent to today admit they never placed my money in one.
They handed me back the deposit - as a 'good will gesture' as they know that I know the legal implications (should have been deposited into one of three schemes within 14 days and given a certificate etc).
I have the money back now and I am happy. But I wish to complain.
Out of interest, who is the best person to complain to? This by the way is a huge UK estate/letting agent and each shop is a franchise.
Can I still claim three times the amount even though I have vacated?
The LL has taken the property off the books so dont think I can demand him name/address within 21 days?
Surely there must be something to be done?
I am the usual type to let stuff lay but this LA is a horror - they wouldnt fix things, they let me go for weeks without a boiler/hot water before arranging a call out, never supplied the CORGI certs, the manager called me and told me I was a nuisance and she wished I never lived there. She told me to my face that the deposit was in a scheme, she lied to me and I cant believe the company/franchise branch will get away with it.

Please, does anyone have sme advice?
Thank you,
N.

[RentedAndRankled]

Originally Posted by Mr Pipps

I’ll forgive you for not being legally qualified.

Does this mean you are, or are you just a layman like I am? Unless you say you are qualified I will assume that your knowlege of the law is not formally taught and you are not legally qualified.

Originally Posted by Mr Pipps

Firstly, in brief, the Legislator and any associated parties must at various junctures outline the basis for their legislative proposals as a fundamental part of the enactment process. In the case of the Tenancy Deposit Order 2007, we are lucky enough to have the rather useful explantory memorandum, and I’m sure you’ll find it rather interesting once you read it. New legislation simply cannot be introduced without it’s requirement and worthiness having been sufficiently demonstrated to the Lords and for this information to be made publicy available.

The explanatory notes for the TDO 2007 only cover it's modifications. Do you have a link/location of the notes for the TDS sections of the HA 2004?

You've previously stated that "The spirit of the law, and the reason for the Legislator drafting this interesting piece of legislation, is to force all landlords to undertake the handling of a tenancy deposit in the correct and appropriate manner from the commencement of the tenancy and to the end.". I would be interested to know where you have got this from.

From the various sources I've read the main benefit of a TDS comes when the tenancy ends as it ensures a means of arbitration for deposit disputes which does not require court involvement. Therefore I would suggest that the spirit of this law is to ensure that this method of arbitration is available at the end of the tenancy and if the LL protects the deposit before the tenancy ends the spirit of the law has been complied with.

Originally Posted by Mr Pipps

Secondly, section 214(4) is specifically introduced within The Act with express reference to section 213. The preceeding section is therefore the only section that possesses any relevance to 214. In the event of an application to the Court, the requirement for the Court to order payment of the penalty turns solely on whether the provisions in sections 213(1), 213(3) and 213(6) were met at the time when the landlord received the deposit from the tenant. I really cannot see how there could be any other way to interpret section 214. It’s one of the simplest legislative provisions I’ve ever had the pleasure of reading.

I've double checked my copy of the HA 2004 and S214(4) makes no reference to S213. The only references to S213 from S214 are the following;

S214(1) refers to S213(10) for a definition of relevant person.

S214(1)(a) refers to S213(4) for a definition of the initial requirements of an authorised scheme, and refers to S213(6)(a) to cover the provision of information to the tenant (but it does not refer to S213(6)(b) which specifies the 14 day timeframe).

S214(2)(a) refers to S213(6)(a) again to cover writen notice to the tenant (but again it does not refer to S213(6)(b) which specifies the 14 day timeframe).

S214(5) refers to S213(7) allow the court to issue an order to recover non-monetry deposits.

S214(6) refers to S213( 8 ) for a definition of deposit.

If you can provide me with a reference where S214 refers explicitly to S213(6)(b) which states the 14 day timeframe I would be grateful, otherwise the more I look at it the more I come to the conclusion that applications for the penalty made under S214 may not be successful because the 14 day timeframe is not specified or referenced as grounds for an application to court as stated in S214(1).

Originally Posted by Mr Pipps

Furthermore, a Judicial decision to not award costs is also one which can be appealed. There is absolutely no requirement under the Housing Act 2004 or any supposed expectation of conduct for the tenant to attempt to coerce or mediate with the landlord before legal proceedings commence. Nor would there be any basis in law for a Court to refuse a claim for costs in the absence of any such quite unnecessary endeavours.

There is an absolultley solid basis in law for refusing costs, and it's clearly written in Rule 44.3 of the Civil Procedure Rules. You can find this at PART 44 - GENERAL RULES ABOUT COSTS

It clearly states in 44.3(4)(a) that the conduct of the parties is one of three factors relevant in determining if costs should be awarded, 44.3(5)(a) covers whether pre-action protocol has been followed (i.e. a letter before action), and 44.3(5)(c) covers the manner in which a party has persued a case (i.e. entering into mediation).

Again, if you know better please provide links to the relevant statutes which override this.

[Planner]

Originally Posted by RentedAndRankled

There is an absolultley solid basis in law for refusing costs, and it's clearly written in Rule 44.3 of the Civil Procedure Rules. You can find this at PART 44 - GENERAL RULES ABOUT COSTS

It clearly states in 44.3(4)(a) that the conduct of the parties is one of three factors relevant in determining if costs should be awarded, 44.3(5)(a) covers whether pre-action protocol has been followed (i.e. a letter before action), and 44.3(5)(c) covers the manner in which a party has persued a case (i.e. entering into mediation).

Again, if you know better please provide links to the relevant statutes which override this.

Tenancy deposit claims are dealt with under Part 8 procedures (N208 Form ). This is allocated to the fast track not the small claims track. Costs are therefore awardable under Part 46 of CPR and are listed.

PART 46 - FAST TRACK TRIAL COSTS

[RentedAndRankled]

Planner,

Do you know if anyone has got a TDS claim through Part 8 and the fast track?

Most of the ones I've seen have been allocated to the small claims track because the amount is less than 5K primarily because the initial deposit is less than 1250GBP.

R&R

[Mr Pipps]

Let's not muddy the waters any further here. This really is a very simple matter.

Regarding section 214(1)(a), I can only say that I wonder how the ‘initial requirements’ of an authorised scheme could possibly be met where a deposit was not introduced to a scheme at the time when it was received?

I think there is now enough information on this thread to allow those wishing to pursue their own cases to reach their own conclusions.

My final advice to everyone would be that, if you find anyone on this forum touting their legal experience when responding to threads, then you should run a mile.

[RentedAndRankled]

Originally Posted by Mr Pipps

Let's not muddy the waters any further here. This really is a very simple matter.

Pipps, if it really was that simple we wouldn't have already seen people failing in their court actions .

Originally Posted by Mr Pipps

Regarding section 214(1)(a), I can only say that I wonder how the ‘initial requirements’ of an authorised scheme could possibly be met where a deposit was not introduced to a scheme at the time when it was received?

The reason is that s.212 to 214 and Schedule 10 of the HA 2004 do not require the scheme to enforce the 14 day rule as part of its initial requirements.

S214(1)(a) makes it clear that it's a schemes initial requirements which need to be breached in order make an application to court. It does not say that a breach of requirements placed on a landlord in other parts of the HA 2004 constitute grounds for an application to court for the 3x penalty.

Originally Posted by Mr Pipps

I think there is now enough information on this thread to allow those wishing to pursue their own cases to reach their own conclusions.

My final advice to everyone would be that, if you find anyone on this forum touting their legal experience when responding to threads, then you should run a mile.

Completely agree, thats why I keep repeating I'm not legally qualified and my posts are my personal take on things.

[Planner]

Originally Posted by RentedAndRankled

Planner,

Do you know if anyone has got a TDS claim through Part 8 and the fast track?

Most of the ones I've seen have been allocated to the small claims track because the amount is less than 5K primarily because the initial deposit is less than 1250GBP.

R&R

No, but that said its not something I activley monitor!.

The Part 8 ( N208 ) route, is the route that the court advises you to use, Part 56 of CPR will shorlty be amended to say that s.214 claims must be conducted via Part 8. Hows that for legal advice?!

[Resoli]

Thanks expressed to RentedandRankled for replying to Mr. Pipps before I could. Without repeating many of his points, here are my thoughts.

Firstly, people have asked for disclosures of experience. Although not legally qualified I have two key areas of experience to disclose - one, I law at undergraduate level, two, I've worked for over a year in a lettings market, albeit nothing in relation to any of this.

Your post made for rather interesting reading. And it sounds to me as if you have approached this matter by firstly quite willingly believing any old yarn that the first man in the street has offered to spin for you - and only then subsequently deciding to ask someone to assist you with the Law. For future reference, that is the wrong order to be dealing with such matters... Firstly, allow me to point out that I am not required to prove anything to anyone. I am posting here simply to provide some much needed assistance to people like you.

Mr. Pipps, I asked you for evidence of what you were / are saying is accurate because there are differing viewpoints on how the legislation can be interpreted. Ed, previous page, has a differing interpretation. RentedandRankled has a differing interpretation, I have a differing interpretation at this point. Surely the point of CAG forums is to people can get together in a neutral atmosphere and help each other?! By pointing us all to the sections you interpret we can all work together to understand it better. How is that a bad thing? You seem to attack the idea that you need to substaniate your viewpoints.