With the relevant parts of the Deregulation Act 2015 having come into force on 26 March 2015, time for a quick outline of what the changes mean for deposit protection and section 21 notices.
Deposit taken pre 6 April 2007 which became statutory periodic after April 2007.
Superstrike [our note] found that any pre 2007 deposit had to be protected if the tenancy became a statutory periodic after April 2007. This decision is shortly to be redundant.
For all pre-April 2007 tenancies which became statutory periodic after 6 April 2007, any deposit must be protected and prescribed information served by 23 June 2015. The deposit will then be treated as if it has always been protected (no retrospective claims). If they are not, then the usual s.214 and s.215 penalties for failure to protect will apply.
Deposits taken pre 6 April 2007 and tenancy became statutory periodic before 6 April 2007
The Court of Appeal, in Charalambous v Ng, [our note] had found that while deposits taken before 2007, where the tenancy had also become a statutory periodic before 6 April 2007, did not have to be protected, no s.21 notice could be served until the deposit was protected or returned.
The Deregulation Act makes no change to this. The deposit doesn’t have to be protected, but no s.21 notice can be served until it is either protected or returned. No penalty claims are possible.
Post 6 April 2007 tenancies
Where a deposit was taken, protected and the prescribed information served within the fixed term, this will be held to count for service of the prescribed information on any subsequent new tenancy (or statutory periodic) arising, so long as the deposit is with the same scheme.
There are a couple of points to note here.
This does mean that the Superstrike position on re-service of prescribed information on new tenancy or statutory periodic arising no longer applies.
But only if the deposit was protected and prescribed information served within the initial fixed term,
The original protection of deposit and service of prescribed info may have been late (after the 30 days). The Deregulation Act will still deem the prescribed information served for any subsequent ‘new’ tenancies (replacement or statutory periodic).
This will not prevent a penalty claim in respect of the original late protection and/or service of PI, as far as I can see, at any time. And even more oddly, it will still be impossible for a landlord to serve a s.21 notice if a deposit has been protected late – after the 30 days – before returning the deposit, unless the tenancy has since been renewed or become a statutory periodic, at which point the new s.215B will apply and the deposit and PI will be deemed to be compliant for the purposes of serving a s.21.
Any ongoing failure to protect and/or serve the prescribed information is wholly outside the provisions of the Deregulation Act. For these, Superstrike principles will continue to apply, so cases like Gardner v McClusker would still be possible.
Retrospective and transitional provisions
The new s.215A and s.215B are treated as having had effect from 6 April 2007, with some exceptions.
Any past possession claims, or penalty claims which have had a final order, and the time for any appeal has expired, cannot be re-opened even if the outcome would have been different had s.215A or s.215B been in force.
Any current s.21 possession claims or s.214 penalty claims, issued before 26 March 2015 will be determined on the basis of s.215A or s.215B. So what had been an invalid s.21 notice will become valid if those sections apply. What had been a valid s.214 penalty claim will be dismissed if the only basis for the penalty claim was the Superstrike failure to serve the prescribed information on a statutory periodic arising. However, the landlord will not be awarded the costs of the possession claim, or defending the s.214 claim (New s.215C(5) ).
In all other situations covered above, what had been a breach is now as if it never was, so there can be no claims for a past Superstrike failing.
As a last detail, the prescribed information requirements have been amended to allow for an agent’s details to be given where the agent is dealing with the deposit.