Tenancy Deposit Scheme

[Joa]

For clarity and ease of use, I would like to suggest that we use this particular thread to post helpful tips, "lessons learned", interesting developments etc , rather then to request help and assistance.

 

Please start your own thread if you need advice.

[Joa]

Tenancy Deposit Protection Scheme – Failure of Landlord to Comply

 

Commencing a County Court claim for compensation

The tenancy deposit protection scheme applies to all deposits paid on or after 6 April 2007, as provided for by Sections 213-215 of the Housing Act 2004.

 

This note does not cover circumstances in which the landlord has complied with the tenancy deposit protection scheme. If the landlord has complied and the tenant has a dispute about repayment of the deposit, the tenant should pursue the matter through the relevant tenancy deposit protection scheme’s arbitration service.

 

This note deals with the situation where it appears the landlord has not placed the deposit in an authorised scheme and/or has not provided the tenant with written information about the particular scheme that tenant’s deposit is held in.

 

 

What happens if the tenant renews their tenancy after 6 April 2007

If the tenant decides to remain in their existing rental property beyond the initial fixed term, how the deposit is treated depends on how the tenancy is continued.

 

Replacement tenancy – ie a new tenancy is created between the same landlord and tenant for the same property – any deposit previously paid will possibly now have to be protected as a new tenancy was created.

 

Periodic tenancy – ie the tenancy continues with no new agreement. Any deposit paid previously will probably not need to be protected because no new tenancy will have been created.

 

The law is not certain on these points, and it may have to take a court case for the matter to be decided. A tenant in this situation should seek specialist advice.

 

 

The obligations on the landlord are set out in S213.

There are two distinct elements to S213

 

1) The deposit must be protected in an authorised Tenancy Deposit Protection Scheme within 14 days of the deposit being paid to the landlord by the tenant.

 

2) The landlord must give the tenant written information about the particular scheme in which the deposit has been paid, within 14 days of the deposit being paid to the landlord by the tenant.

 

 

The compensation provisions are set out in S214.

 

The provision is that if the landlord does not comply with the requirements of S213 the tenant is entitled to compensation of three times the amount of her/his deposit.

 

This requirement is strict. If the judge finds that the landlord did not comply with S213 the judge must order compensation to be paid to the tenant. The judge has no discretion. Similarly, the judge has no discretion about the amount of compensation. If compensation must be paid, the judge must order that it be three times the deposit.

 

In addition to this compensation, the court must order either that the landlord repays the deposit, or that the deposit is protected in the Tenancy Deposit Protection Custodial Scheme within 14 days of the date of the court order. The judge has discretion to decide which of the two options to order but one or the other must be ordered.

 

 

What happens if the tenant has moved out of the property before the court hearing?

The law says that a tenant is entitled to claim compensation. It does not refer to a former tenant. There is an argument that if the tenant has moved out of the property so that they are no longer the tenant, they cannot claim compensation.

 

If the court claim was issued at the time the tenant was still occupying the property, then it is likely that the tenant will be entitled to claim compensation, as they were the tenant at the time the claim was issued.

 

If the court claim is issued after the tenant has moved out of the property, then it is possible that the former tenant will not be entitled to compensation, as they were not a tenant at the time the claim was issued. However, there is a counter argument that because the claim is all about the period when they were a tenant, that they will be entitled to claim compensation.

 

This is another area that is likely to take a court case to determine.

 

 

Current court decisions

There have been some recent county court decisions that have applied interpretations of Sections 213 and 214 that are not advantageous to tenants.

 

In one case it was held that even though the landlord had not provided the tenant with the information required by S213 within the 14 day time limit, the tenant was not entitled to any compensation because the landlord did eventually provide the information.

 

In other cases, judges have given conflicting decisions on the situation whereby the deposit was paid into a scheme, but was paid in after the 14 day time limit. In one such case the one judge did order compensation to be paid, and in another the judge refused to do so, saying late compliance was still compliance.

 

Because these were decisions of the county court they are not precedent, so they do not need to be followed by any other judge.

 

Until a precedent court makes a ruling, it would be still be reasonable for tenants to issue claims when the landlord has complied with the scheme but outside the 14 day time limit. However, the tenant should be advised that the law is currently uncertain and they may lose their case.

 

 

The claim form

The tenant will have to fill in the appropriate court claim form N208

Blank forms can be obtained from any County court, or from the Court Service website http://www.hmcourts-service.gov.uk/HMCSCourtFinder/FormFinder.doc

 

There are two types of court procedure under which claims of this type can be commenced, called the Part 7 procedure and the Part 8 procedure.

 

The Civil Procedure Rules at CPR 56.1 and Practice Direction 56 para 2.1 require tenancy protection deposit scheme claims to be made under Part 8 on Form N208 http://www.hmcourts-service.gov.uk/courtfinder/forms/n208a_0499.pdf

 

Court guidance provides more details on how tenancy deposit protection claims should be made. http://www.hmcourts-service.gov.uk/docs/infoabout/housing/section-214-application.pdf

 

Currently some county courts do not appear to realise that tenancy protection deposit scheme claims must be made under Part 8, and are requiring tenants to make them under Part 7.

 

A claim wrongly made under Part 7 will not be dismissed by the court. The judge will either treat the claim as if it was made under Part 8, or will let the claim continue under Part 7.

 

There are significant differences between Part 7 and Part 8 claims in relation to the costs the tenant may be liable to pay, and in procedure. A tenant may need to get further advice on this point if necessary.

 

 

The court fee

 

There is a court fee for issuing a court claim. The amount depends on the amount being claimed http://www.hmcourts-service.gov.uk/courtfinder/forms/ex50.pdf

 

If the tenant is on a low income they may be entitled to full fee remission, or a reduction in the fee. Form ex160A will need to be submitted to the court to apply for fee remission, together with the required proof of income as set out in the guidance notes attached to the form. http://www.hmcourts-service.gov.uk/courtfinder/forms/ex160a_e.pdf

 

 

Claiming interest

The tenant is entitled to interest on the compensation from the date the compensation was due. Compensation will be due from 15 days after the deposit was paid, as the landlord had 14 days to comply with S213.

 

The tenant will need to claim for interest on the claim form. If interest is not claimed it will normally not be awarded. The tenant will need to calculate how much interest the landlord owes and put the specific sum on the claim form.

 

Using the figures as an the example , interest was calculated as follows:-

 

Amount claimed £2000.

 

0.00022 x £2000 = 0.44p

So, the daily rate of interest is 44p.

 

The deposit was paid on 24 March 2008. The landlord should have protected the deposit within 14 days, so by 9 April 2008. Compensation is therefore due from 10 April 2008. The claim form was completed on 15 April 2009. 371 days have passed between 10 April 2008 and 15 April 2009.

 

371 x 0.44 = £163.24

 

£163.24 is added to the £2000 claimed making a total claimed of £2163.24.

 

The correct wording should be used as set out on the example claim form.

 

 

Witness Statements

The tenant is allowed to rely on evidence, such as the tenancy agreement or the receipt for the deposit. In a Part 8 claim any evidence must be attached to the claim form.

 

An important piece of evidence the tenant should always consider providing to the court is his or her witness statement. A witness statement is the statement of someone who wishes to give information about the background to the case, see example witness statement available on the NHAS site.

 

The tenant and the landlord can provide witness statements if they want to. If they feel that someone else can say something helpful on their behalf, that person can provide a witness statement.

 

It is usually a good idea for the tenant to file a witness statement. Although the tenant will have the opportunity to put their side of the story to the judge at the hearing, the tenant may find afterwards that they did not tell the judge everything they wanted to. The tenant may have been nervous, or felt a bit rushed, or simply forgot to say something. A witness statement gives the tenant the opportunity to set out exactly what they want to say to the judge, so that if they get nervous or flustered at the hearing it will not matter because the judge will have all of the relevant information.

 

The tenant can attach to the witness statement copies of any documents they want the judge to consider. Originals should be brought to the hearing.

 

 

What happens next

The claim form is served upon the landlord by the court. What happens next will depend on how the landlord chooses to respond to the claim, and how the claim is treated by the court. The tenant will be notified by the court of the next steps.

 

 

SUMMARY

The following must be filed at court to commence the claim

 

• Part 8 claim form

 

• Court fee, or fee remission application form and proof of income.

 

• Any evidence the tenant wants to rely on

Edited November 3, 2009 by Joa
New briefing

[Joa]

This is a very recent advice sheet provided by NUS: http://resource.nusonline.co.uk/media/resource/enforcement_pack.pdf

I need to underline that currently (March 2008 ) we still have very little information about the way the courts are treating claims made under provision of TDS legislation- so tread carefully and share your experiences with us.

[Joa]

I wouldn't go as far as dismissing the whole document as not useful; it does contain some good stuff. Tgk's comments on it in light of our current interpretation of the legislation; that the 14 days period is crucial and once crossed, there is no going back, the landlord cannot remedy things "later". But many landlords will and that's where the 3x fine would be still applicable.

 

But we really do not know what the judges are going to do with this quite harsh piece of regs. HA 214(4) does state (clearly, in my opinion) that the court must also order the landlord to pay to the applicant a sum of money equal to three times the amount of the deposit within the period of 14 days beginning with the date of the making of the order.

So once the deposit has been paid into TDS or repaid - the landlord still must be fined, if initial requirements have not been fulfilled.

 

I think there will be some time before judges are fully on the ball with the above.

[Joa]

Guys, could we just post definite news, tips and experiences of TDS here, please? Otherwise thread becomes difficult to manage. Many thanks!

[Joa]

Ladies and gents, we have a decision!

TENANCY DEPOSIT CASE (S213 HA 2004)

 

 

Stankova v. Glassonbury 10th March 2008, Gloucester County Court

 

 

 

The claimant Ms Stankova is from Bulgaria and took a private tenancy with Mr Glassonbury on 1.8.07. She was a joint tenant with her daughter and another tenant (unknown to her before start of tenancy).

 

 

 

The tenants jointly paid a deposit of £600 in order to move in. The landlord did not notify any of the tenants that he had deposited the money in any of the statutory Schemes at any time.

 

 

 

There were various problems with the landlord and he served notice on 2.10.07. The notice was defective. The third tenant moved out of property shortly afterwards and the three tenants made arrangements about how the deposit would be dealt with on its return.

 

 

 

On 28.10.07 the landlord entered the property and removed a carpet and the fireplace from the lounge making it unusable and also pulled the extractor fan out of kitchen leaving a hole in roof. The Council dealt with the harassment. The landlord promptly served a further notice November 2007 under s21 which was on the face of it a valid notice.

 

 

 

Ms Stankova moved out in Feb 2008. She made a claim under the Housing Act 2004 against the landlord for his failure to notify her within 14 days of how he would deal with the deposit and which scheme he was using.

 

 

 

The landlord submitted various arguments against the claim; that the tenant owed some rent arrears, that he had now placed the deposit in a scheme and that there was damage at the property for which he would wish to withhold some or all of the deposit.

 

 

 

At the hearing of the matter District Judge Singleton ordered the landlord to pay £1800 +£75 costs in respect of three times the deposit plus the court fee.

 

 

 

In awarding the monies, the judge accepted the tenant’s argument that the award was a strict liability penalty, and that consequently there was no provision for counterclaim for outstanding rent arrears or other arguments about the return or retention of the deposit on the basis that a statutory scheme included arbitration for disputed about returning or retaining deposit monies.

 

 

 

Comment: In giving his decision the judge expressed concern that ‘it goes against the grain’ and advised the landlord to take legal advice as to whether he could delay the 14 days in which he must pay the claimant.

 

With thanks to Gloucestershire HAC

[Joa]

Be warned of what, you muppet? you think I made it up?

Gloucester Crown & County Court

http://www.stltrainingschool.co.uk/WESTERN_CIRCUIT.pdf

combined, is the word.

[Joa]

I have asked before and I am going to ask again; can all queries, requests for advice, support etc be posted in a main forum. This thread is ONLY for TDS related news, tips, updates, comments on legislation etc.

[Joa]

I am not sure what's happening here with regards to the applications under s.214, so I thought I'll post this just in case. I have not had time to pop in here at all recently but whole libel case ( bloody ridiculous) has brought me back.

 

One more thing- despite the clear recommendations below, I have so far been using N1 for my clients. Never had any comments or challenges about it from the courts.

 

taken from http://www.hmcourts-service.gov.uk/docs/infoabout/housing/section-214-application.doc

 

Tenancy Deposit Protection – Housing Act 2004

 

County court applications under section 214 of the Act

 

 

Background

1. Landlords and agents are required to protect their tenants’ deposits under a scheme set out by the Housing Act 2004 (“the Act”) .

 

2. Under these provisions, the landlord or agent is required to place any deposit into an approved tenancy deposit scheme (“TDS”) within 14 days of receipt. The landlord is also required to provide the tenant with confirmation that the deposit has been put into a TDS.

 

3. Where a landlord fails to do this, a tenant may apply to the county court to compel the landlord to repay the deposit or place it in an approved TDS (see section 214 of the Act).

 

“Section 214” application to the county court

4. The application under section 214 can only be made on limited grounds. If the court is satisfied that those grounds have been met, the court must either order the repayment of the deposit or order the person who appears to be holding the deposit to pay it into a designated account under a authorised custodial tenancy deposit scheme. The court must also order the landlord to pay a sum of money equal to three times the amount of the deposit.

 

CPR Part 8 procedure

5. The appropriate procedure for starting a “section 214 claim” is provided by Part 8 of the Civil Procedure Rules (CPR). A tenant will therefore need to follow the procedure set out in Part 8 of the CPR and the accompanying Practice Direction and pay the appropriate court fees in accordance with The Civil Proceedings Fees Order 2008 (if not exempt). Details about the correct claim form to be used (Form N208 ), the contents of the claim form and filing of evidence in support of the claim, and also the procedure to be followed by the defendant landlords are set out in this part of the CPR – for more details see footnote .

 

6. Detailed guidance on completing Form N208 and subsequent action to be taken by the defendant landlord is also set out in the relevant forms as attached below (also available in hard copy from any county court office):

• Part 8 Claim Form (N208 ) http://www.hmcourts-service.gov.uk/courtfinder/forms/n208_1000.pdf

• Notes for Claimants (Form N208A) http://www.hmcourts-service.gov.uk/courtfinder/forms/n208a_0499.pdf

• Notes to Defendants (Form N208C) http://www.hmcourts-service.gov.uk/courtfinder/forms/n208c_1202.pdf

 

7. To avoid any confusion, Part 56 of the CPR will be shortly be amended to state that section 214 applications must be started using the Part 8 procedure.

 

Disputes after deposit is placed in a TDS

8. Please note that this guidance is only aimed at resolving disputes about placing a deposit into a TDS. It is not aimed at resolving disputes about the return of a deposit that has been placed in a TDS – e.g. at the end of the tenancy. Each TDS scheme is supported by a free alternative dispute resolution (ADR) service whose role is to resolve such disputes about the return of a deposit that has been in a TDS. Use of the scheme’s ADR service is not compulsory but their purpose is to avoid such disputes reaching the courts.

 

9. If however parties to such disputes do decide to use the courts to resolve these particular matters, they are advised to seek separate advice about appropriate court procedures that may be available.

 

Further Help and Advice

10. There are other HMCS leaflets available from the HMCS website Her Majesty's Courts Service - Home or county court offices which are designed to help claimants and defendants, but they can only give a general idea of what is likely to happen. Court staff can advise on court procedures and provide the forms needed and help to fill them in, but they cannot give legal advice.

 

11. Free legal advice may be available from Citizens Advice Bureaux, law centres or independent advice agencies. Contact details can be found in the local phone directory and details may be displayed in local courts. Alternatively, contact Community Legal Advice on 0845 345 4345 or their website at Community Legal Advice