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Tenancy Deposit legislation still producing unwelcome surprises

RLA
Written by RLA

The Court of Appeal handed down a decision yesterday in the case of Charalambous v Ng on tenancy deposit protection. Tenancies where deposits were taken before tenancy deposit legislation came into force in 2007, which then turned into periodic, also before the law came into force, will now have to protect deposits. These landlords were outside the original decision, but now must comply.

The Court of Appeal handed down a decision yesterday in the case of Charalambous v Ng on tenancy deposit protection. Tenancies where deposits were taken before tenancy deposit legislation came into force in 2007, which then turned into periodic, also before the law came into force, will now have to protect deposits. These landlords were outside the original decision, but now must comply.

This will only impact few landlords, those that have a tenancy that falls under the following categories:

  • A very long fixed term AST which started before 2007
  • A periodic AST which started before 6th April 2007
  • A continuation as a contractual run on following the end of the fixed term

In response the RLA has updated Section 21 forms on the website to make sure that they are up to date with the changes implemented by the recent ruling.

This constant ‘shifting sands’ of tenancy deposit regulation is frustrating and highlights the dangers of passing legislation based on flawed data and analysis, and that unintended consequences can arise many years afterwards.

Some seven years after tenancy deposit legislation was enacted, new circumstances are being discovered and only causing headache for those trying to remain inside the law.

Those pressing for further changes to section 21 legislation to deal with so called retaliatory eviction should take note!

About the author

RLA

RLA

The Residential Landlords Association (RLA) represents the interests of landlords in the private rented sector (PRS) across England and Wales. With over 23,000 subscribing members, and an additional 16,000 registered guests who engage regularly with the association, we are the leading voice of private landlords. Combined, they manage almost half a million properties.

3 Comments

  • I know that nationwide this will be a fairly small number of tenancies, but for me it will be a fair number. I have many tenants who have been in properties for a large number of years, and their tenancies have all become periodic at the end of the fixed term.

    One question which isn’t totally addressed by the article is that it seems that deposits for tenancies which were still within the fixed term when the deposit registration legislation took effect will not need to be registered. Is that correct?

    Taken with the problems that have arisen at the end of the fixed term this is clearly legislation that needs revising – fast!

  • Is the judgement available anywhere? I know it was yesterday so maybe it’s a bit soon. Let’s hope it’s on the web before Xmas so we can all mull over it, no pun intended!

  • As a small landlord for many years I believe the issue that is not being addressed is the following –
    [I] Periodic tenancies
    These are not valid in law when a contract AST establishes a legal term that terminates at a time certain there should not be an automatic renewal. To have the automatic right to a periodic tenancy is a fallacy and an error in law. Once a contract is terminated it can or should only be continued with a NEW AST paid for by the Landlord – This allows the Landlord to vary the AST if needed (as few of our tenants follow the rules or their AST) The reality is that most tenants do not comply with the Tenancy agreements they sign and do not have a clue or obey or even read the covenants they agreed in their AST. Therefore a periodic renewal defeats the purpose for compliance with the Rule of Law.
    Tell that to the Judges –
    [ii] Additionally Diane Abbott (MP’) s bizarre interference with the rates of rent that private landlords can charge is not index linked and is unlawful. Who is she to make arbitrary & undemocratic proposals that have no economic basis without input from us Landlords who would be affected – this is undemocratic nonense coming from a Labour MP… Who does Ms Abbott think she is and on what basis does Ms Abbott think she has the Right and Power to exclude us who render a vital service for a great number of the population who choose to rent our accommodation. This is more interference by someone who knows little of the facts & pursues publicity on a biased and undemocratic proposal that is not good for the economy or in line with the increased costs we landlords pay to keep our properties to the standard required which is the reason our tenants choose to rent from us. .

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