The Government has tabled an amendment to the Deregulation Bill in a bid to clarify the situation surrounding Tenancy Deposit Protection (TDP) after the case of Charalambous & Karali v Ng & Ng in December.
The judgement from the case stated that the landlord’s Section 21 (served in 2012) was invalid because the tenancy deposit was never protected, despite the deposit being taken before TDP legislation was in place.
The ruling hinged on the wording of TDP legislation and effectively the judge ruled that although the landlord was not required to have protected the deposit before the law came into force, they were indeed required to have a deposit protected in order to serve a s21 notice.
The Government’s amendment looks to clarify that:
>No matter when a landlord took a deposit they will be unable to serve a s21notice if the deposit was not properly protected at the time of serving the notice.
>If a landlord took a deposit on or after 6 April 2007 they will be unable to serve a s21 if they failed to protect it within the deadline for compliance – 30 days.
>A tenantwill only be able to apply to the County Court for financial sanctions against the landlord if the deposit was taken after 6 April 2007.
In other words, the amendment will mean that if a landlord took the deposit before the law came into force, they just need to protect it before serving a s21. However, if a deposit was taken after 6 April 2007, then the landlord should have complied anyway and could still be liable for financial sanctions for non compliance