Deposit Dating

Another case about deposits! Our main deposit page, stated in relation to Superstrike that  a gap still remained, namely:

Although R had argued, even if the provisions of s.213 (Requirements relating to tenancy deposits) had not applied to the deposit as a result of the creation of the statutory periodic tenancy in 2008, nonetheless s.215(1) (sanctions of non-compliance) applied to prevent a s.21 notice from being served whenever a deposit is held which is not held in accordance with an authorised scheme. Whilst the Court could “see the basis for this argument” and if correct “it would have had extensive consequences when the legislation first came into force, since it would have required any deposit to be put into an authorised scheme before the landlord could serve a section 21 notice after the commencement date, even if there would have been no other obligation to do so under section 213. It is not clear how significant would be the effect of this point now, six years after the provisions first came into force


However, the Court stated “is not necessary to decide it for the purposes of determining this appeal. For that reason, I prefer not to deal with it but to leave it to be decided in a case in which it matters, if one such were to arise”.

The court in Charalambous & Anor v Maureen Rosairie Ng & Anor [2014] EWCA Civ 1604 has now stated that a deposit needs to be protected if it is held by the Landlord. If this is not done the s21 notice is invalid but sanctions do not apply.


The Landlord had given a tenancy which commenced in August 2002 for a fixed term of one year. It was renewed in 2003 and 2004 and thereafter became a statutory periodic tenancy. A s21 notice was served in October 2012. It was held valid at first instance and the tenants appealed.


The court found that:

  1. Retrospective legislation is possible if parliaments intention is clear. In this case the court stated the grace  period given to landlords to comply with the protection provision as brought in by the Localism Act 2011 (Commencement No. 4 and Transitional, Transitory and Saving Provisions) Order 2012  and the fact a provision contained in Article 16 of that Order held that the amendments would apply to any assured shorthold tenancy “in effect on or after 6th April 2012″ indicated parliament had meant for this to be applied to some degree of retrospectivity.
  2. In this instance the sanctions under s213 did not apply as it specified a time after the legislation was enacted;
  3. The requirement for the deposit being protected did apply as under s215(a) (has to be in an authorised scheme);

Remaining Issue

The one remaining issue that remains now is as per our last post ie when deposit protection expires or wasn’t fully “done”.

The Deregulation Bill is hopefully going to clear this up slightly but the current draft would need some amendments to help solve this string of cases quickly.



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About Arfan Bhatti

Arfan Bhatti is a Qualified Solicitor practicing Property and Public Law department dealing with all property related work and Judicial Review cases against public bodies.Read more about Arfan or give him a call.

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