Piggott V Slaven Great Grimsby County Court, 23 February 2009

Mr Piggott granted a tenancy to Ms Slaven in 2005. She paid a deposit of £600.00 for this tenancy. On 14 February 2008, another tenancy was granted for a different property. £75.00 from the earlier deposit was repaid to Ms Slaven. The balance of £525.00 was held by Mr Piggott. He said that £105.00 was for the first weeks rent and that £420.00 was “rent in advance”.

On 24 June 2008, Mr Piggott served a section 21 notice requiring possession on 27 August 2008. Possession proceedings were commenced and Ms Slaven defended those proceedings contending that the £420.00 was a deposit and the landlord had failed to protect the deposit as required by s.213 Housing Act 2004. If that was the case, the landlord was unable to serve a section 21 notice at any time the deposit was not protected (or prescribed information given) and the notice was therefore invalid (s.215 Housing Act 2004). She also counterclaimed for an order for Mr Piggott to pay three times the deposit.

After referring to s.212(8), District Judge Richardson held that the question of whether or not money is to be held as security is to be judged objectively. It would be contrary to the purpose of the Act to allow landlords to avoid its consequences by stating that they personally did not intend to hold money as a security. He found that the sum of £420 was not paid as rent in advance, but was intended to afford Mr Piggott security should Ms Slaven breach any future obligations to pay rent under the tenancy agreement. It was accordingly a ‘tenancy deposit’ for the purposes of s212(8). It had not been dealt with in accordance with an authorised scheme, as required by s213. He dismissed the possession claim and ordered Mr Piggott to pay £1260 within 14 days

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