Latest News

Mon 27th July 2009
Severe Penalties for Landlords in Breach of Tenancy Deposit Laws

Since April 2007, all deposits taken by landlords under assured shorthold tenancy (AST) agreements must be protected in a tenancy deposit protection scheme, which applies to most private rented accommodation.

The obligation is on the landlord to protect the deposit and provide certain scheme information to the tenant within 14 days of receipt. Since the introduction of the scheme by the Housing Act 2004, it seems there are still many landlords and tenants who remain oblivious to their legal obligations and rights until it is too late.

The scheme ensures that the deposit is held safely by a government authorised body. There are several types of scheme providers operating, but the same rules apply almost uniformly.

We have seen a growing recent trend in court action being taken against landlords for failing to protect deposits. The sanction for breach is an order to pay the deposit into a scheme or to the tenant, and to repay 3 times the deposit to the tenant, and it is irrelevant what the intentions of the landlord were when it failed to protect the deposit.

If you are a tenant who has provided a deposit, but not received the relevant scheme information, your deposit could be unsafe and you have a legal right to redress. If you are a landlord and think you may be in breach of your tenancy or legal obligations, you could face a costly penalty, as well as a county court judgment being entered against you. Despite the potential severe consequences, many landlords, it seems, are continuing to act in breach of their legal duties owed to their tenants.

At PWHM our property department specialises in setting up tenancy agreements addressing both the landlord's obligations and the tenant's rights. Our litigation department acts for both landlords and tenants when disputes arise from a failure to follow the terms of the lease, or the law in relation to deposits, and other breaches.

If you are thinking about letting out your property, entering a tenancy agreement, or are already a private landlord or tenant with a query, please contact our team at PWHM for advice.