Summer Newsletter - ATTENTION ALL LANDLORDS!!
From 6 April 2007 all new Assured Shorthold Tenancies in England & Wales must be protected by a tenancy deposit protection scheme. A landlord has just 14 days to safeguard a deposit from the day of receipt. The landlord must provide the tenant prescribed information about the scheme safeguarding the deposit within that 14 day period.'
These provisions are intended to ensure a tenant’s deposit is safeguarded by landlord. There are two types of scheme: custodial and insurance-based (2 variants). The landlord – not the tenant – can choose which option to use. The Landlord and Tenant can agree how the deposit is to be paid back and in the absence of agreement the matter can be referred for Alternative Dispute Resolution or to the Court.
A 10 day pay-out period operates with either scheme: for the custodial scheme it must be paid out within 10 days of the scheme being notified of agreement between the landlord and tenant or of an ADR/Court decision (where there is a dispute); for the insurance-based scheme it must be paid out within 10 days of the tenant requesting the landlord return his deposit.
Failure to operate the tenancy deposit scheme has far reaching effects for the landlord.
The landlord will not be able to regain possession of the property using the usual 'notice only grounds'.
The Court will order the landlord to repay the whole deposit within 14 days or deposit it with the custodial scheme administrator.
The court must order the landlord to pay to the tenant a fine of three times the deposit amount within 14 days of the making of the order.
Attention all landlords indeed!