tenancy deposit scheme's and non compliance

shotton123

I have recently taken a case to court as my landlord failed to protect the deposit and provide me with the prescribed information.

I started court proceedings and had judgement for default but unfortunately the claim was changed and the judgement was not for 3 times the amount, as the deposit was finally lodged with the dps some 20 months late and after the court judgement, as the dps have no initial requirements and take deposits even with very late compliance you are unable to breach under section 214 for 3 times the penalty.

Despite campaigning to various housing minister's, mp's I am finally giving up the ghost now, MARTIN PLEASE PLEASE LOOK INTO THIS FOR ME or if anyone has anything to add please contact Wendy Armstrong at the Housing Communities office as she believes that this legislation is working very well and that all tenants deposits are being secured as per the legislation and that the government can not be held responsible for how courts are interpreting the law, draycott v hannels has just proved that the courts are intepreting the law correctly , it is the dps that are not working within the legislation. I am just a lonely individual who feels very passionate about this matter, and I have just had to stop my appeal as of cost implications and time constraints as I have spent nearly 12 months on this matter

I urge anybody out there to campaign to have this leglislation work for tenants and not landlords

clutton_2

have you contacted Kevin Firth - head of DPS ? he posts on here sometimes...

is there anything within the legislation that says tenancy deposit schemes cannot accept deposits late ?

wrightk

we did the same with our previous landlord who failed to pay into the dps then refused to give our deposit back when we moved.
We didnt go for the 3 times though, it was quite a smooth process. We originally got a judgement by default and a warrant of execution, then the landlord wrote a sob story to the court and applied to have the judgement set aside 3 times (paying £75 a time for this) each time refused by the court. The landlord told the court that because i didnt chase her for my dps ID number within 14 days it wasnt her fault.
Anyway we won the case, got our deposit back plus court fees and ballif fees and that was that.

Are you still living in the property. I'm 99% sure that if the landlord hasnt paid the deposit into the scheme within 14 days of your tenancy agreement starting they are liable.
Its much smoother to take them to court for the deposit back rather than going for the 3 times, when we looked into it there were various clauses under this route that the landlord could get out of, plus if your claiming for 3x the amount this will push you out of the small claims court and you will end up paying a lot out to get someone to represent you in court.

We went through the MCOL paid £35 for the claim,although it took about 6 months for us to get our money because of the faffing around by the landlord to try and get out of it it went really quick.

When you say the claim was changed how do you mean? give some more info.

If i was you i would give up on the 3x there is so many get out clauses, reclaim the deposit plus all court costs

shotton123

We filed claim as part 8 as instructed by court with guidelines, I got a letter to say that the claim had been changed by the judge no explanation to a part 7, judgement for default was given on 15th february 2010 as my landlord had failed to communicate with the court, at this time when the judgement for default was given without a hearing the deposit and prescribed information were not given,the judgement was worded with for an assessment for damages for the court to decide, deposit was finally protected on 21st february 2010 some 20months late with dps and I still received no prescribed information, but by this time we were serving our notice to leave, we left on 3rd March 2010, so deposit was only there for 2 weeks at the most, The dps allow this and no initial requirements, she argued the deposit and we had to go to adr got some back but not all, it took 4 months to go to court, at which time just received the court fee back and she left court laughing free to do it do another unsuspecting tenant.

shotton123

Wendy armstrong who works for the private sector housing division in london, states and I quote

The departments view is that the legislation is clear that the landlord must protect the deposit within 14 days, the policy intention was that landlords who do not comply should be subject to the penalty set out in section 214, which is enforced by tenants taking their landlord to court, however it is for the courts to interpret the legislation and to decide whether the penalty should apply , she also believes that section 214 is working and as there is limited caselaw available to assess its effectiveness.

The ruling within Draycott v Hannells I think sums it up it is the initial requirements that you have to breach and if the company ie the DPS has none then there is simply nothing to breach and no penalty to pay.

the ruling is here

<LI value=54>The outcome of this appeal turns on whether the 14 day requirement is, or is not, a part of the initial requirements of an authorised scheme. If it is not, then when the deposit is paid into the scheme later than 14 days from its receipt by the landlord, but before the tenant commences proceedings, then the court cannot be satisfied under s.214(2)(a), and therefore the court will not be able to make an order under s.214(3) or (4). <LI value=55>If, in order to give any effect to Chapter 4 of the 2004 Act, it were necessary for s.214(4) to apply in such case, then it might be possible to interpret s.214 so that the 14 day time requirement is to be considered a part of the initial requirements of the scheme. But I think that would be a strained interpretation, and I do not think it is necessary in order for Chapter 4 of the 2004 Act to have effect. Chapter 4 has effect, in that so long as the deposit is not paid, the landlord cannot recover possession. Of course, if it is the tenant who wants to give up possession and recover his deposit, that sanction is nullified. But that does not mean that, on the interpretation that I would give to the ss.213 and 214, there is no sanction.
1. For these reasons I allow the appeal.

shotton123

My deposits do not accept late compliance, TDS does but the landlord has to pay to amend the documents and give a valid reason for late compliance, the DPS has no initial requirements and accept very late compliance it is there belief as per an email that I have received from them, that the primary purpose of the legislation is to protect deposits even if one is submitted eg on day 15, they do believe my deposits accept them after 14 days, but on reading other information on forums and advice from other people I believe this to be incorrect.

So my belief is that by accepting very late compliance and where do you draw the line on how late, 3 months, 3 weeks, 3 years ??? and no initial requirements that the legislation quite clearly states, it can not surely operate within the legislation.

shotton123

Here is the order
Deposit Protection Service is no banker for tenants



The message


Landlords and letting agents should note this significant decision relating to deposits for assured shorthold tenancies.

The case


The decision in Draycott v Hannells Letting (12.02.10) has important implications for landlords who take rent deposits from tenants with shorthold residential tenancies. Following the introduction of “tenancy deposit schemes” under to the Housing Act 2004, there has been much debate in the property industry about their application and this decision sheds a little more light on the matter.
Landlords often require tenants to pay a deposit as security for damage caused to the premises or rent not being paid. Some landlords, however, fail to return the deposit at the end of the tenancy when they have no right to retain it, so the statutory tenancy deposit scheme was introduced to provide more security to tenants.
Any deposit paid to a person in connection with a shorthold tenancy has to be dealt with in accordance with an “authorised scheme”.
In this case, the Draycotts were granted an assured shorthold tenancy on 28 February 2008. Hannells Letting was the landlord’s letting agent. Under the tenancy, the Draycotts were obliged to pay a deposit of £2,700 to Hannells as security, which required protection under the tenancy deposit scheme. This sum was credited to Hannells’ account on 4 March 2008.
The legislation requires that where a landlord receives a shorthold tenancy deposit, it must comply with the “initial requirements” of an authorised scheme within 14 days of receiving the deposit. The authorised scheme in this case was the Deposit Protection Service (DPS), which was authorised to hold deposits on a custodial basis to protect tenants’ interests in their deposits.
The DPS stated that the landlord or letting agent was responsible for ensuring that the deposit was submitted to the DPS for protection within 14 days of the landlord receiving it. The landlord was also required to provide certain information to the tenant within 14 days of receiving the deposit.
Hannells registered and lodged the deposit with DPS on 19 May 2008 and the Draycotts were not given the required information until 21 May — in both cases considerably more than 14 days after Hannells received the deposit.

Statute provides for adverse consequences for landlords if they do not comply with the requirements of the scheme, including repayment of the deposit and inability to recover possession. A court may also order the landlord — or person acting on its behalf — to pay the tenant a penalty equal to three times the amount of the deposit.
The court may make such an order following a tenant’s application on the ground, for example, that the initial requirements of an authorised scheme have not been complied with.

Fortnight opinion


The court first decided that the initial requirements of the DPS comprised lodging the deposit, but that doing this within 14 days could not be seen as an initial requirement of the scheme.
Second, the court considered that the penalty, if applicable, should be imposed on the person responsible for any failure to comply with the statutory requirements relating to the deposit.
In this case, that was Hannells, the letting agent, and not the landlord.
Finally — and the key point — the court had to decide whether the penalty would be payable where Hannells had protected the deposit in accordance with the legislation by the time the Draycotts started their claim, but had not done so within the 14-day period after Hannells received the deposit. The court held that no penalty was payable because lodging of the deposit within 14 days was not part of the DPS’s initial requirements.
More generally, the court appeared to take comfort from the fact that there were other sanctions for landlords, such as inability to recover possession of the premises until the deposit is lodged with the scheme.

Summing up:


Draycott v Hannells

• The Draycotts said Hannells did not lodge a deposit with the Deposit Protection Service (DPS) in time.
• The High Court said the DPS did not need to receive the deposit within 14 days.
• Therefore the court also decided that no penalty was payable.

There appears to be alot of grey matter in the sense of who has what obligation.

My next step is to see my MP to perhaps the Parliamentary and Health Service Ombudman look at this for me as I have exausted all other avenues


Postscript:

shotton123

Here is the requirements I don't think it refers to anything about deposits being accepted late, it mentions 14 days so I think that is the law and those initial requirements again which clearly the dps does not have ? help as I am not a Lawyer, and it does not appear to be that straight forward is it ?

Also when I started my claim I thought it to be a straight breach of section 213 (6)(a)
and it appears not to be the case,

Section 213: Requirements relating to tenancy deposits
501. From the time these provisions come into force all landlords and their agents will be required to ensure that any deposit required in relation to an assured shorthold tenancy is safeguarded by a tenancy deposit scheme. Landlords, agents or tenants will not be able to avoid the legislation by agreeing that a deposit should not be safeguarded by a scheme. If a deposit is required the landlord or his agent will always be required to comply with the provisions. Within 14 days of the landlord or his agent receiving a deposit he must ensure that the deposit is safeguarded by an authorised TDS in accordance with the scheme's requirements and give the tenant and, if relevant, the person who paid the deposit, such information as is prescribed by the appropriate national authority as to which scheme is safeguarding their deposit, how the scheme's initial requirements have been met and details of the relevant legislation which protects their deposit.
Section 214: Proceedings relating to tenancy deposits
502. The tenant, or the person, who paid the deposit, will be able to apply to the court for an order requiring the person holding the deposit to repay the deposit or to pay it into a custodial scheme in two circumstances. Firstly, where a landlord has not safeguarded a deposit in accordance with the initial requirements of a scheme or given the tenant the required information within 14 days. Secondly, where the landlord has informed the tenant that a particular scheme is safeguarding the deposit and the scheme has not been able to confirm this.
503. If at the court hearing the court is satisfied that the landlord has not complied with the initial requirements of a scheme or provided the information required by section 213 (6)(a) or that the deposit is not being safeguarded by an authorised scheme the court must either order the person holding the deposit to repay the deposit to the applicant or pay it into an authorised custodial scheme within 14 days of the order being made. The court must also order the landlord or his agent to pay the applicant an amount equivalent to three times the deposit.
504. Where a landlord or his agent has taken a deposit which could not be lawfully required, i.e. one which does not consist of money, the person who gave it to the landlord or his agent is entitled to recover it through the courts.
Section 215: Sanctions for non-compliance
505. The landlord may not serve a notice under section 21 of the Housing Act 1988 at any time where a deposit is not being safeguarded in accordance with an authorised scheme or where either the initial requirements of the scheme have not been met or the prescribed information regarding the safeguarding the deposit has not been given. Under section 21 of the Housing Act 1988 a landlord can obtain an order for possession of an assured shorthold tenancy at any point after the first 6 months of the tenancy providing that any fixed term has expired and that they have given the tenant at least 2 months notice. This is sometimes referred to as the 'notice only' ground for possession as there is no need to prove fault on behalf of the tenant.
506. A landlord also cannot use this 'notice only ground' for possession while they are holding a deposit which could not be lawfully required, i.e. one which consists of something other than money.

N79

What is the point of this thread?

shotton123

Surely if a landlord uses the DPS he/she can never comply with the intitial requirements as there are'nt any so therefore can never abide by the requirements of the legislation, therefore rending the leglislation useless ?

Am I correct in this ?

shotton123

I am asking for some information on non compliance of tenancy deposit schemes