Many letting agents still don’t know what Prescribed Information is or even that, if they’re protecting the tenant’s deposit on behalf of the landlord, they need to give Prescribed Information to all tenants.
This could mean unfortunate consequences for your landlords, who can not only be fined but can lose the ability to gain possession of their properties.
Prescribed Information is a document which explains where and how the tenant’s deposit has been protected and how it will be dealt with when the tenant leaves. It can be a separate document or included within a tenancy agreement.
As well as protecting the deposit in a deposit protection scheme, Prescribed Information must be given to the tenant, and anyone who pays the deposit on the tenant’s behalf, within 30 days of receipt of the deposit. The deposit protection certificate and a terms and conditions leaflet must also be given at this time.
Landlords, or their agents, should re-serve Prescribed Information at the start of every new tenancy, including when the tenancy becomes ‘statutory periodic’.
Prescribed Information is a ‘hot topic’ at the moment for tenants, and their legal representatives, who may try to raise it as a defence to possession proceedings.
There are generally two sanctions when Prescribed Information has not been given to the required people and the deposit requirements have not been met:
• Fine against the landlord - this can be up to three times the amount of the deposit
• Prevent recovering possession of the property using the section 21 notice
The landlord may then be able to sue the agent for their loss. Rent guarantee and legal policy claims may also be declined, due to failure to comply with relevant legislation.
If a tenant does use lack of Prescribed Information as a defence, there are some remedies to the situation that you could try:
• Return the deposit to the tenant or serve them the Prescribed Information – then a section 21 notice can be served
• Where Prescribed Information has not been served and/or the deposit protected, a section 8 notice may be served
However, it’s important to note that the financial risk of a fine to the landlord remains in all circumstances mentioned above.
The law is currently based around the ‘Superstrike’ case and legislation should be made in 2015. We’ll endeavour to keep you updated through our blog on any changes to this but, if you require any more information in the meantime, please speak to your deposit holder scheme.