Date Published 08 November 2012
The Court of Appeal has this week imposed the maximum penalty on a residential landlord following a dispute with a tenant over prescribed information under tenancy deposit law. Virtually all of the prescribed information had been supplied and what was omitted was described as `minor`. After the case, lawyers said the omission could have been put right by giving the tenant a copy of the Scheme`s leaflet – something the tenant could have got for themselves.
Landlords (or their agents) have a duty to produce a list of ‘prescribed information’ to all their tenants, covering standard information about how the relevant scheme operates. The exact information required is set out in the Housing (Tenancy Deposits) (Prescribed Information) Order 2007.
In the case of Ayannuga v Swindells, the landlord omitted to provide minor pieces of information listed in the prescribed information.
The case arose after the tenant allegedly fell into rental arrears and the landlord sought possession. The tenant countered, by saying that the landlord had not supplied all the prescribed information. The landlord did not dispute this, but argued that the requirement was largely a procedural one and that the deposit had been protected as the law required. The landlord also said that the tenant could have found out everything he needed from the scheme`s administrator.
Thus, at the first hearing, the landlord argued that he had provided most of the information and that the only deficiencies related to the mechanics of the scheme which the tenant could easily have found for himself from the provider of the scheme. The judge agreed and dismissed the claim brought by the tenant for the return of the deposit. The court agreed and dismissed the tenant`s claim. The tenant then appealed.
This week the Court of Appeal overturned that decision and awarded the tenant the maximum compensation of three times the tenancy deposit.
Luke Maunder, a property specialist with law firm Barlow Robbins, said: `This case has important implications for residential landlords and residential agents.
"It is not uncommon for minor pieces of information to be omitted from the prescribed information, particularly as the Act allows it to be produced separately from the Tenancy Agreement, and some required items instinctively seem less important as the tenant can find it easily elsewhere.
`In the case of Ayannuga v Swindells, the landlord failed to provide details of the procedures to be followed in certain events. Details of the Tenancy Deposit Scheme had been provided, but the omission of the additional information – potentially as simple as including a leaflet provided by the Scheme – has cost him thousands.
`The maximum fine is three times the deposit, but the landlord also forfeits the original deposit, so in reality it is four times. As a deposit is usually at least a month’s rent, a small error can be very costly."
He advised: `All residential landlords and letting agents need to take note of the important decision in Ayannuga v Swindells and make sure that they provide all the necessary prescribed information, ideally well within the 30 days allowed.`