Tenancy Deposit Claims

Former and present tenants and/or relevant person can claim against the former / present landlords under s.214 Housing Act 2004 for the landlord and / or agents failure to protect the tenants deposit in a tenancy deposit scheme within the prescribed 30 days, and / or failing to provide the tenant with the prescribed information to allow the tenant to check that the deposit has in fact been secured.

Pursuant to the Act if the court is satisfied that the deposit has not been protected and/or that it was protected late the court must “…order the Landlord to pay to the applicant a sum of money not less than the amount of the deposit and not more than three times the amount of the deposit within the period of 14 days beginning with the date of the making of the order.” The Court may also order the person holding the deposit to pay the deposit into a scheme, if for example you are still a tenant, or pay the deposit back to you, if they have not already done so. Therefore, if you are a former tenant and the Landlord / Agent did not return the deposit to you the Court could award up to 3 x the value of the deposit plus the return of your deposit.

If you have paid a “holding deposit” before the tenancy agreement started, to hold the property, this “holding deposit” becomes a deposit for the purposes of s.214 as soon as you become a tenant and so must therefore be protected within 30 days of the tenancy starting.

There are various cases on the issue of tenancy deposit claims more recently the majority of which are County Court decisions which seem to indicate that the awards vary between 1 – 3 times the value of the deposit depending on a number of factors:

  1. Is the landlord a first time landlord who was mistaken as to their obligations and they protected the deposit but a few days late – the likely award will be 1 times the value of the deposit
  2. The Landlord did not protect the deposit at all and / or they are seasoned landlords who know the requirements and didn’t protect the deposit or protected it late – likely award 2 times the value of the deposit
  3. The Landlord is a company who deal with various rental properties, there are various claims against them from various tenants, they have not protected the deposit, the tenant can show other unreasonable behaviour – likely award 3 times the value of the deposit

There is a set protocol for dealing with these claims and the landlord has 20 days in which to respond to a ‘letter of claim’ so the timescales are tight.

Legal aid is only available in Housing Disrepair claims where the disrepair is a serious risk to a person’s health and safety so most claims do not qualify.

We recommend:

    1. In your Letter of Claim / Letter before Action – asking the Landlord and Agency for a copy of the tenancy agreement. Notably, these should be kept by the landlord / agent for HMRC purposes and so if they do not have them then this would raise concerns over their ability to adhere to any regulations / requirements and could be raised as a conduct issue and the Court be asked to consider the same. We always state that if the tenancy agreement and / or a response to the request is not provided within 7 days then a PAD application will be made for an order in respect of the same and costs sought.
    2. Obtain evidence of the deposit payment such as a bank statement, text or email to the landlord / agent confirming payment was made, and or a receipt. However, if the tenancy agreement provides for a deposit to be paid this may be enough
    3. Obtain confirmation that there are no rent arrears, eviction notice or counter claim. If there are then this may affect the claim and / or any award for costs.

It is always better to be forewarned and forearmed in these claims.  Some courts will take into account any rent arrears in a counter claim and off set the same against your claim which if they are equal to or of similar amounts a court may not award you your costs.

In respect of costs we have found that some Landlords and unfortunately some inexperienced Solicitors do not understand that these claims are not small claims track matters and that standard costs apply.

It is also worth noting that if the landlord has not protected the deposit no section 21 notice may be given in relation to the tenancy at a time when the deposit is not being held in accordance with an authorised scheme. The landlord may choose to protect the deposit late so that they are then able to serve the tenant with a section 21 notice.

It is always recommended to make reasonable, early part 36 offers and calderbank offers in these claims as the landlords failure to consider, reply to and / or beat these offers can be referred to the Court as evidence of unreasonable behaviour when dealing with the issue of costs.