Tenancy Deposit Schemes - More Changes For Residential Landlords!

Since 6 April 2007, it has been mandatory for a landlord to protect a deposit paid in connection with an assured shorthold tenancy within an authorised tenancy deposit scheme ("TDS") and to provide certain prescribed information to the tenant within 30 days of receipt of the deposit. If the landlord fails to do so, it will not be able to serve a valid section 21 notice to bring the tenancy to an end, and it may also be liable to financial penalties.

In the 2013 case of Superstrike Ltd v Rodrigues [2013] EWCA Civ 669, the Court of Appeal considered what steps a landlord should take where a fixed term tenancy, entered into before the tenancy deposit registration rules came into force, expires and the tenant remains in occupation under a statutory periodic tenancy after the rules came into force. The Housing Act 2004 makes clear that such a periodic tenancy will be a new tenancy and so the Court of Appeal decided that the landlord would be required to register the deposit (and provide the prescribed information to the tenant) at the time the statutory periodic arises under the Act.

The recent Court of Appeal decision of Charalambous and another v NG and another [2014] EWCA Civ 1604 has taken this point further and will come as unwelcome news for a number of residential landlords.

In Charalambous, the fixed term tenancy came to an end in August 2005 (some 20 months prior to the tenancy deposit registration rules coming into force), and the tenant remained in occupation under a statutory periodic tenancy. On 17 October 2012, the landlord served a section 21 notice requiring possession of the property. The tenant challenged the validity of the section 21 notice as the deposit paid by the tenant was never held under a...