TENANCY DEPOSIT SCHEME CHANGES – LOCALISM ACT 2011
The Localism Act (which amends the Housing Act 2004) received Royal Assent on 15 November 2011 and is thought likely to come into force in April 2012. The most significant changes are:
- The time period for complying with the initial requirements of a scheme and providing the prescribed information is to be extended from 14 to 30 days after receipt of the deposit;
- The penalty will be payable if the Landlord fails to comply with the time limits imposed by statute, i.e. within 30 days of receipt;
- The Landlord will no longer escape liability for the penalty if he/she complies with the requirements before the day of the hearing of the tenant’s claim for the penalty, (the Localism Act 2011 has reversed the Court of Appeal’s decision in Tiensia v. Vision Enterprises Limited);
- A person who was the tenant, will be able to bring a claim for the penalty, (the Localism Act 2011 has reversed the Court of Appeal’s decision in Hashemi v Gladehurst);
- The penalty will not necessarily be “equal to three times the amount of the deposit” (and will not be in addition to the Court ordering the repayment of the deposit, or that it be paid into a scheme). The amount of the penalty will be at the Court’s discretion but no more than three times;
- The restriction on the service of a s21 Notice has been removed where the deposit has been returned in full, or else returned less any agreed deductions and if a tenant has brought a claim, that claim has been either determined by the Court, withdrawn or settled
Anthony Best
Partner