The recent decision of Siddeeq v Alaian may prove to be a cause of concern for some landlords who may find themselves in breach of legislation regarding the registration and protection of deposits and thus unable to serve a valid section 21 notice as shown below.
The case concerned a defence against a possession order following the expiry of a section 21 notice. Before the beginning of the tenancy, the Landlord had served the tenant with the Prescribed Information relating to the protection of their deposit before the deposit was ever received. At the first hearing, the District Judge initially held this to be a correct and valid procedure. This was however, reversed on appeal by the Circuit Judge, holding that serving Prescribed Information prior to receiving a deposit would not satisfy the statutory requirements for serving Prescribed Information.
It should be noted that this appears to be the most logical interpretation of the relevant legislation (Section 213(6)(b) Housing Act 1988) which requires that the Prescribed Information be served within the period of 30 days beginning with the date the deposit (or any part of it) is received by the landlord. Nonetheless, many landlords and agents may have been hoping such legislation would be interpreted slightly differently, allowing Prescribed Information to be served any time before the lapse of the 30-day period, whether this be before or after the deposit was received.
While the decision coming from the County Court will not be binding, the decision being made by a Circuit Court judge will likely lead to other County Court judges being very hesitant to depart from the decision. As such it could be ill-advised for landlords to continue to serve Prescribed Information, whether as part of the Tenancy Agreement or separately, before they have received the deposit. As has always been PainSmith’s position, it may be far safer to delay the service of Prescribed Information until the landlord has received the deposit.
For any landlords or agents who believe themselves to now be in breach of this interpretation of the statute it may be wise to keep close tabs on any developments in this area of law. Siddeeq v Alaian may have reached its conclusion, but it is likely this will not be the last time that such an issue is contested. In the meantime, it may be prudent for agents not to send Prescribed Information until they have received the whole deposit. However, it is vital that the deadline of 30 days after the receipt of the deposit is not missed as this can open the landlord to severe fines of one to three times the value of the deposit per year of the tenancy.
Published 19/08/2024
