Musings on the tenancy deposit protection scheme

Note - the Landlord Law Blog has now moved to www.landlordlawblog.co.uk.

One of my landlord clients who has successfully defeated a nuisance claim brought by her tenants under the tenancy deposit protection legislation, has reported an interesting conversation she had with the Judge. Apparently the Judge said that the judiciary generally are unhappy with the legislation. The main reason being the automatic aspect, as they do not like having their decision power taken away from them.

That’s fair enough and I can understand their point of view. The trouble is, that if the Judges have a discretion whether to make the award or not, it makes it impossible for us advisors to give any meaningful advice. Inevitably different Judges will decide similar cases in different ways. This will result in injustice overall, as it is inequitable for a tenant’s right to an award to depend on the particular viewpoint of the Judge concerned (who may not be experienced in housing work). If the award is automatic then people know where they are.

It is important also to understand the reason for the legislation in the first place. It is to force landlords (many of whom are still in denial) to use the tenancy deposit protection scheme. A scheme set up to protect tenants from the injustice of landlords (not all of them by any means but a fair number) effectively stealing tenants money by unreasonably refusing to return deposits.

If landlords see a window of opportunity many of them will continue to refuse to protect deposits, rendering the new scheme useless. It will of course mostly be the ‘bad landlords’ who will do this – ‘good landlords’ are on the whole already compliant.

So automatic penalties are the best way of preventing avoidance. It is harsh justice on those who offend through ignorance, however this is not the only field where ignorance of the law is no defence – and there are many sources of free help and information. This legislation has been in force for over a year now - there is really no excuse for non compliance any more.

Incidentially, my client had protected her deposit and had the paperwork to prove it.