There are two appeals on cases involving claims for the return of deposits and the three times penalty in both of which – astonishingly, given the recent history of High Court and Court of Appeal decisions – the tenant was awarded the penalty. We have said before that it would now be a somewhat incompetent landlord who would be caught by a claim. You can draw your own conclusions from the facts of these cases. The way in which Hashemi is distinguished in the first of these cases is interesting, but perhaps unlikely to be of general application

First, in the High Court:
Suurpere v Nice & Anor [2011] EWHC 2003 (QB)

Ms Suupere was an assured shorthold tenant of the Defendant, of part of a house. The tenancy began on 6 January 2009. Rent was £300 per month, with a deposit of £500 paid to the landlord. The landlord was described by the Judge as ‘inexperienced’.

Relations between Ms S, other tenants and the landlord became difficult. On 11 May 2009, Mr N served a ‘notice to quit’ on Ms S.  This was invalid, not being in the prescribed s.21 form or providing two months notice. On 18 May 2009 a further notice was served, giving two months, but back dated to 11 May 2009. On 12 June 2009, Mr N fixed a ‘notice of eviction’ to the front door, which was, of course, no such thing. On 15 July 2009, Mr N brought possession proceedings in Guilford County Court, relying on the backdated notice. This claim was later stayed.

On 20 July 2009, following a letter from the CAB, Mr N transferred the deposit to the DPS scheme, but no prescribed information was sent to the tenant (nor was the need to do so mentioned in the CAB letter). Ms S did receive information from the DPS about the deposit having been protected.

On 10 August 2009, Ms S issued proceedings claiming for return of the deposit and the 3 x penalty, as well as, later,  unlawful eviction (unsuccessful) and breach of quiet enjoyment (successful). On 14 August, she left the property, allegedly after harassment.  The deposit was returned to her in full on 1 September 2009. Mr N defended the claim saying that the deposit was protected and ‘required information provided’ once they had been told about the requirements of the scheme by Guildford BC. The deposit had been returned in full and there was only ‘an innocent technical breach’.

At the hearing in June 2010, the Circuit Judge relied on Draycott & Draycott v. Hannells Letting Limited (trading as Hannells Letting Agents) [2010] EWHC 217(QB) and found that, as the deposit had been protected prior to the commencement of proceedings, s.214(4) Housing Act 2004 penalties did not apply.

On appeal, Ms S argued that, while the deposit was protected prior to the issue of proceedings, the prescribed information which was required to be provided under s.213(5) & (6)(a) had not been complied with prior to issue or before the hearing of the claim. The Claimant’s claim raised non compliance with s.213(6)(a) so s.214 was enagegd and the penalty order should have been made. Tiensia v. Vision Enterprises Limited(Trading as Universal Estates): Honeysuckle Properties v. Fletcher and Others [2010] EWCA Civ. 1224 relied upon – para 37.

The Respondents argued that:

they transferred the deposit on 20 July 2009; that they gave the Appellant full details of registration of the deposit on 21 July, confirming the deposit reference number and providing details of the DPS website; and that they had complied with their duty to provide information as required by the Act and the 2007 Order. Alternatively, if they are wrong about that and they did not comply, then they contend that they were not required to supply the Appellant with the prescribed information after they had returned the deposit to her on 1 September. They state that the purpose of these statutory provisions is to protect tenants from unscrupulous landlords. They argue that a tenant who has had information provided about the deposit and has then had the deposit returned in full does not require protection. It would have been futile for them to have given particulars of the scheme to the Appellant between 1 September 2009 and 1 June 2010, the date of the hearing of the Appellant’s claim under s. 214, by which time the deposit was no longer in the scheme.

The High Court, Mrs Justice Cox DBE, held:

Following Sharp J in Potts v Densley and Pays [2011] EWHC 1144 (QB), it will make no difference to the landlord’s statutory obligation to provide the prescribed information if, by the date of the hearing, the tenant’s deposit has been repaid.

The letter from the DPS that the claimant/appellant had received did not provide all the information required by the 2007 prescribed information order and it was not enough for the Defendants to say that the information was available on the DPS site. The landlord was obliged personally under the Housing Act 2004 to provide the information.

On representations made after the hearing but once Gladehurst Properties Ltd v Farid Hashemi (on behalf of himself and Matthew Johnson [2011] EWCA Civ 604 had been handed down, the Defendants/Respondents argued that the tenancy had ended when Ms S left the property on 14 August 2009, so, following Hashemi, it was not open to the Court to make an order under s.214.

However, it was not at all clear that the tenancy had ended at that time [paras 61-62]:

there is no evidence to support the submission that the tenancy came to an end when the Appellant left. It was not in dispute in Gladehurst that the tenancy had terminated. However, the Appellant in the present case did not accept that her tenancy had been determined because she brought a claim for wrongful eviction, claiming that she was forced to vacate as a result of the Respondents’ harassment.

Nor is there any evidence to show that she had surrendered the tenancy. The Respondents issued and pursued a claim for possession, which was stayed by Judge Reid pending determination of the Appellant’s claim for damages, and which therefore remained outstanding as at the date of the hearing. In fact, Judge Reid found that the Notice to Quit was defective in this case because it did not provide the Appellant with two months’ notice, as required by s.21(1) of the Housing Act 1988. It is perhaps unfortunate in the circumstances that he did not deal with both claims together and decide the issue of determination of the tenancy before going on to consider the Appellant’s claim in respect of the deposit.

In short, the Appellant’s tenancy had not been lawfully determined as at the date of the hearing. So Hashemi did not apply.

The Judge below should have ordered the payment of the 3 x penalty under s.214(4). Payment of £1,500 ordered.

We only have a short note from the Garden Court Housing Bulletin on the second case, which was a refusal of permission to appeal to the Court of Appeal. I’ve not been able to find a transcript.

Owolabi v Bello [2011] EWCA Civ 881
29 June 2011

The claimant landlady sought possession and arrears of rent. The defendant assured shorthold tenant counterclaimed for damages for unlawful eviction and harassment and for a penalty of three times the deposit (which had not been protected). At trial the judge gave judgment for £2500 rent arrears but on the counterclaim awarded £13,000 damages and repayment of the deposit (£220) and a penalty of three times that amount (£660). The Court of Appeal dismissed the landlady’s renewed application for permission to appeal because it simply amounted to an attack on the judge’s findings of fact based on his having taken a dim view of the landlady’s credibility.