It’s nearly six years since the relevant provisions of the Housing Act came into force which required landlords of assured shorthold tenancies (ASTs) to both protect any monetary deposit they choose to take by placing it into a government authorised scheme. They were also forced to comply with the prescribed information requirements.
Carla Williams, Legal Executive at Woodcocks Haworth and Nuttall states that serious implications can be imposed on a landlord failing to comply with its statutory duty, including difficulties in regaining possession of the property. Such implications can result in a County Court Judgment of up to the full amount of the deposit and compensation to the tenant between one and three times the amount of the deposit.
As a basic guide landlords should keep the following in mind:
- Do take legal advice before entering into a tenancy agreement verbally or in writing.
- Do ensure that any deposit is placed into an authorised scheme and comply with the prescribed information requirements within 30 days of taking it including providing the tenant with the necessary information within the same time scale.
- Do remember to comply with this duty even if the deposit was originally taken for a tenancy pre-April 2007 but a new AST has since been entered into. This includes ensuring you re-register a deposit for post-April 2007 ASTs if a further AST has been entered into since the deposit was originally registered.
- Don’t attempt to contract out of the provisions…you will not be permitted.
- Don’t try to serve a section 21 notice without complying with your statutory duty – it won’t be valid.
- Don’t take a deposit – consider whether a deposit is needed as one of the easiest ways of avoiding breaching your statutory duty is to not take a deposit in the first place.
For more detailed advice and assistance contact Carla Williams at our Rawtenstall office on 01706 225 621.
