The Deregulation Act 2015, which came into effect by Royal Assent on Thursday 26th March 2015, clarifies a number of issues and requirements for Landlords. Two key areas that may catch unaware Landlords out relate to deposits and notices.
Deposits
Since 6th April 2007, it has been a requirement for a Landlord to protect any deposit they receive from a tenant where a property is let under an Assured Shorthold Tenancy Agreement (the most common type of tenancy agreement). Protection takes the form of the Landlord paying the deposit into a recognised Tenancy Deposit Scheme and advising the tenant of the details of that scheme (prescribed information). Previously, where the deposit was taken before 6 April 2007 there was no requirement for a Landlord to protect a deposit. Under the new legislation this has now changed. Where a deposit was taken prior to 6 April 2007, for a tenancy whose fixed term ended after 6 April 2007, Landlords have been given until 23 June 2015 to protect those deposits or face a potential fine.
A great deal of confusion and difficulty arose last year as a result of a series of cases decided by the Courts, including Superstrike v Rodrigues, over the requirements where a deposit was correctly registered at the start of an Assured Shorthold Tenancy which continued after the expiry of its fixed term. The Courts had ruled that the deposit needed to be re-registered and the prescribed information once again given to tenants. The Deregulation Act has effectively overturned this position so that fulfilling the requirements at the commencement of the tenancy is sufficient.
Notices
Under the Housing Act 1988, notice has to be given to bring about the end of an Assured Shorthold Tenancy Agreement. The most common form of notice is the Section 21 (s.21) Notice which gives a minimum of 2 months’ notice to the tenant to vacate the property. Serving a valid s.21 Notice has long been a problem for Landlords as a failure to enter the correct information invalidates the notice. The Deregulation Act places further hurdles for a Landlord to overcome in order to regain possession of his property.
Alongside the provisions on deposits detailed above, if a deposit has not been properly protected then it is impossible to serve a valid s.21 Notice. The Landlord can now no longer serve a valid s.21 Notice within the first 4 months of an Assured Shorthold Tenancy Agreement. This prevents the once common practice of serving the notice at the same time as starting the tenancy to ensure possession was handed back at the end of the tenancy.
The Deregulation Act also puts measures in place to prevent future ‘retaliatory evictions’. For agreements entered into after 1 October 2015, should a tenant complain about disrepair and the local authority issue an enforcement notice requiring improvements, any s.21 notice served thereafter will be invalid until the issues are rectified.
If you need any assistance or legal support, please contact us on propertydisputes@jefferieslaw.co.uk.