As many will know, the case of Superstrike Ltd v Rodrigues  EWCA Civ 669 says that when a statutory periodic tenancy arises, a new deposit is in effect received because the statutory periodic is a brand new tenancy.
As a result, many commentators suggest that as a new deposit is received, new prescribed information must be given within 30 days of a tenancy becoming statutory periodic as well as within 30 days of the original tenancy. We advise this action is taken as do the tenancy deposit schemes themselves.
The reason for this is the wording in section 213(5) Housing Act 2004 which reads:
(5) A landlord who has received such a tenancy deposit must give the tenant and any relevant person such information …
This principle that prescribed information must be given upon a tenancy becoming statutory periodic has for the moment been confirmed in the county court by Gardner v McCusker 3BM70525, Birmingham County Court (link to the NearlyLegal note on the case).
In this case, a tenancy was granted by the landlords Mr & Mrs Gardner to the tenant Ms McCusker in November 2009. A deposit of £600.00 was paid which was protected in January 2010. It seems there were a number of attempts to provide the prescribed information between 2009 and 2012.
The fixed term expired in May 2010 and a statutory periodic tenancy arose [section 5 Housing Act 1988] and in March 2013 a section 21 notice was served.
The tenants defended the subsequent possession proceedings using the following arguments:
- A new tenancy arose at the end of the fixed term and as a result a new deposit was received by the landlord (see Superstrike).
- As a result, fresh prescribed information should have been given in relation to the new deposit.
- That had not been done in any of the various attempts.
- Therefore, the section 21 notice was not validly served [section 215 Housing Act 2004] and the landlord was liable to pay damages up to 3 times deposit (plus return of deposit).
The landlord responded by arguing:
- The prescribed information “rolled over” along with the new statutory periodic tenancy and therefore prescribed information wasn’t required again
- At least one of the various attempts to provide prescribed information was valid.
- Superstrike didn’t apply because in that case there was no attempt to protect the deposit or provide prescribed information whatsoever (because the original deposit was taken pre April 2007) unlike this case.
Unfortunately for the landlord (and all landlords generally) the court found for the tenant.
Superstrike decided a new deposit was received when a statutory periodic tenancy arises and as a result this needed new prescribed information just as a renewal tenancy would.
It was therefore held that the section 21 had not been validly served and the landlord was ordered to pay 2 times deposit plus return of the deposit (£1,800 in total) The landlords were also ordered to pay costs which were set off against some rent arrears and other costs from earlier proceedings.
So, this case follows in line with current thinking that prescribed information must be given not only when the deposit is first received but also when the tenancy goes statutory periodic. Of course this doesn’t apply with our tenancy agreements because ours don’t go statutory periodic.
In this case it’s unclear from the note whether a full and suitable prescribed information was ever actually given. One of the tenants arguments taken from the note was:
… (i) none of the various attempts at compliance met the requirements of the Prescribed Information order; …
Although the landlord argued that:
(b) the prescribed information which had been provided (on at least one of the four occasions) was valid;
But the result doesn’t answer that. If prescribed information had never been given adequately then the decision isn’t really of any particular significance. However, if the first one was valid and then no others after the statutory periodic were valid that adds more weight.
This case also opens up a further question:
If the first prescribed information was valid and the landlord had served a section 21 in month 4 before the end of the fixed term, would that have remained valid even if new prescribed information was not provided in month 7 after the fixed term?
Section 21 provides that a notice served during the term remains valid even when the tenancy turns statutory periodic [s.21(2) HA1988]. Therefore, is it now worth serving a section 21 notice on every tenant at some point during the fixed term?  That way, presumably, even if prescribed information is not provided a second time, the section 21 would nonetheless be valid (although the penalty of up to 3 times deposit would still remain payable).
How bizarre would that be if legislation designed to protect tenants actually has the end result of forcing landlords with no option but to give a section 21 notice on every tenant just to protect his or her position!
For the avoidance of doubt, we don’t suggest serving a section 21 notice on every tenant in this way. We have always held the view that notice should only be given at the point when the landlord truly seeks possession of the property. Our documentation avoids the problems encountered in this case so there is no need.
- It has been held recently that where a section 21 is served even before the deposit is protected / prescribed information given as long as these are subsequently done within 30 days, the notice will nonetheless be valid – Tummond, R (on the application of) v Reading County Court & Anor  EWHC 1039 (Admin) ↩