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This article looks at the timing of when tenancy deposit prescribed information can be given, and whether the deposit must be paid before the prescribed information can be given to the tenant.
In a recent case, Siddeeq v Alaian (K00BF465), heard by HHJ Hellman at the Mayor’s and City of London County Court on 9 August 2024, a significant legal question was addressed regarding the timing of prescribed information related to tenancy deposits under the Housing Act 2004. The case, initially heard at Brentford County Court, centred on whether a landlord could serve prescribed information before the deposit was actually paid and still satisfy the legal requirements for serving a valid Section 21 notice.
The case applies similarly in Wales, as the wording of the Renting Homes (Wales) Act 2016 is similar in relation to a section 173 notice.
The tenancy began on 12 November 2021, when both parties signed an Assured Shorthold Tenancy (AST) agreement. The agreement included a section containing various elements of the prescribed information required under the law, including the deposit amount. The landlord also provided the tenant with a leaflet from the Mydeposits scheme at the time of signing.
The tenant paid the deposit the following day, 13 November 2021. The landlord then protected the deposit with the Mydeposits scheme around 19 November 2021 and provided the deposit protection certificate to the tenant. However, neither party signed this certificate. Therefore, the only signatures related to the prescribed information were those on the tenancy agreement, which had been signed before the deposit was paid.
On 3 November 2022, the landlord served a Section 21 notice to recover possession of the property. When the tenant contested this notice, arguing that the prescribed information had not been adequately served, the case proceeded to the County Court. In the first instance, the District Judge ruled that it was permissible to provide the prescribed information before the deposit was paid. However, the tenant was granted permission to appeal, which HHJ Hellman heard.
In the appeal, HHJ Hellman overturned the initial ruling. The critical issue was whether the Prescribed Information Order 2007 required the information to be served only after the deposit had been paid. The Judge concluded that both the Housing Act 2004 (specifically sections 213(5) and (6)) and Article 2 of the Prescribed Information Order require that the prescribed information be provided after the landlord has received the deposit.
HHJ Hellman emphasised that simply providing the required information is insufficient unless supplied at the correct time—after the deposit is paid. He noted that the legislative intent is clear: the prescribed information must reflect the actual deposit amount, which cannot be confirmed until the deposit has been paid.
Furthermore, the Judge rejected the landlord's argument that complying with section 213(6)(a) of the Housing Act 2004 could occur even if the information was provided before the deposit was paid. He clarified that this interpretation would undermine the legislative framework to protect tenants and ensure clarity in deposit-related disputes.
The appeal was allowed, reinforcing the legal principle that landlords must provide prescribed information only after receiving the deposit.
This summary is based on the detailed case analysis available on the Nearly Legal Blog.
In our view, the intention behind the timing mentioned in the legislation is to give an accurate cut-off date when the information must be provided. It seems harsh (and not Parliament's intention) for a landlord to receive a penalty of between 1 and 3 times the deposit and be unable to serve a section 21 for giving prescribed information alongside a tenancy agreement! It has been suggested that as the deposit has not yet been protected, it is not accurate at the time as the scheme could change. However, nothing requires the prescribed information to be given 'after' the deposit has been 'protected'. The information could be provided on day one after receiving the deposit and then protected 20 days later. Also, landlords typically belong to a single scheme and protect all deposits similarly without change.
The problem is that it's often easier to provide the prescribed information at the time of the tenancy because the tenant must "be given the opportunity to sign the information." However, a landlord can't receive the deposit at this time because only a holding deposit is allowed under the Tenant Fees rules until the grant of a tenancy. This will require all parties to have two separate documents to sign at different times, which wastes everybody's time. This will be noticeably time-consuming in student lettings where there can be four or more tenants who may often have a relevant person (e.g. parent) who must also sign the prescribed information.
Anyway, it is what it is, and for now, it's an easy fix for the majority who would prefer the prescribed information to be signed by the tenant and relevant persons at the same time as the tenancy for ease and convenience to all parties. After the deposit has been paid, the deposit certificate provided by the scheme should be provided to the tenant regardless of this decision. At the same time, a copy of the already signed tenancy agreement and prescribed information should be included in the email. The email body might read something like:
I am attaching a copy of the deposit protection certificate, tenancy agreement, deposit prescribed information and the other documents attached to the tenancy.
Keeping a record of this email will be essential and must be shown to have been after the deposit was received. Email delivery will be adequate, assuming the tenancy they have signed allows document service by email like the Guild contracts have (where a service email address has been entered in Tenancy Builder).
If prescribed information has been provided within the tenancy and a Section 21 notice is to be served, it would be advisable to send a copy because prescribed information beyond 30 days still allows a Section 21 notice to be served.