Your Name (required)

Description (required)

Your Phone Number (required)

We will endeavour to contact you
within the next hour.

Gladehurst Properties Limited v Hashemi

Call me lazy but here’s the summary of the case.

The Court of Appeal in their judgement held that the case of Tiensia did not assist the landlord in this case because the landlord had never complied with the initial requirements or provided the prescribed information and given that the lease had now ceased they cannot do so.

The landlords arguments in defence of the application were:

  • That it could not be the intention of the legislature to require compliance with s.214 of the Housing Act 2004 after the lease when deposits were generally handed back after some appropriate deductions;
  • That the word ‘tenant’ in s.214 could only mean a tenant in a lease that was subsisting;
  • That none of the schemes intend for deposits to be registered once the lease has ended and if the claim by Hashemi were to succeed this would mean that tenants could have a claim for some years after the lease is over;
  • As an alternative that the landlords liability should be limited to the deposit amount that is held by the landlord because most of the despot had been returned.

In response to the above arguments the court held that the legislation does not make it a prerequisite of any application by a tenant that the lease must still subsist. The legislation also does not include a definition for ‘tenant’ although it is accepted that the word is used to refer to former tenants by the DPS. Finally that the word deposit had a clear meaning which was the deposit money paid at the commencement of the tenancy.

Taking all of this into account and the circumstances of this case the Court of Appeal has made the decision that the court cannot make an award for three times the deposit where the lease has expired. Whilst it was recognised that a landlords failure to register the deposit was unlawful it was not a criminal offence for which there were criminal sanctions imposed.

The obvious problem with this decision is that if no liability is going to be imposed then landlords will simply choose not to register the deposit and will only do so if the tenant makes a threat to go to court during the tenancy. When this was put to the court the response was that tenants could still rely on the Act to make an application for the award during the tenancy. In relation to the loss of the benefit of the deposit adjudication services that tenants would experience from this becoming a common strategy the Court noted that they would be able to make use of the small claims track in the county courts…..which was one of the things that tenancy deposit protection was introduced to get away from!

5 Comments

  • collette 26th May 2011 at 7:21 am

    whoever wrote the 2004 Act needs to go back to lawschool…….

  • Tony 29th May 2011 at 12:36 pm

    Am I correct in assuming that Landlords and their Agents have now been fully gifted a “get out of jail free” card in respect of the Housing Act 2004, tenancy deposit scheme 2007, specifically s214 (4) sanctions.

  • Andrew 18th June 2011 at 3:24 pm

    So does the court also lose the power to order the landlord to repay the original deposit under s214 once the tenancy has expired?! That’s what my landlord’s solicitors seem to be claiming now!

    • PainSmith 21st June 2011 at 9:47 pm

      If the deposit is held as stakeholder then the deposit should be returned pursuant to the terms of the agreement that you both entered into. If the landlord is attempting to make a claim for x amount and you are not happy about this then you may go to court for a determination on the issue.

2 Trackbacks

Leave a Reply

Please wait...

Subscribe to our blog

Want to be notified when our article is published? Enter your email address and name below to be the first to know.