So there we all were happily issueing prescribed information as required by the Housing Act 2004 when along came the Superstrike vs Rodrigues case and the world changed!
To summarise, the Court of Appeal case of Superstrike vs. Rodrigues concerns an assured shorthold tenancy that was created in January 2007 prior to the introduction of mandatory tenancy deposit protection on 6 April 2007. The tenancy continued on a
statutory periodic basis from January 2008 and the deposit remained unprotected.
In 2011 a Section 21 notice was served to end the tenancy. The Court of Appeal has ruled that when the tenancy continued on a statutory periodic basis in 2008 a new tenancy was made and a new deposit was deemed to have been received, and therefore fell under the requirements of tenancy deposit protection legislation. Having not met those requirements (to protect the deposit and serve Prescribed Information (PI), including serving the scheme leaflet, or equivalent) the landlord was not entitled to serve a s21 notice.
For months the lettings industry was left with a dilemma that no one seemed to know the answer to. That dilemma being does the deposit always have to be re-protected when the tenancy becomes periodic and does the prescribed information have to be re-issued.
The speculation was rife. Does a periodic tenancy become a new tenancy every month? Does the prescribed information have to be re-issued every month? This is how silly it got. Eventually the 3 Schemes issued joint guidance.
The decision in Superstrike confirms that a statutory periodic tenancy is a new tenancy. This begs the question whether the deposit that has already been protected needs to be re-protected and PI re-served. It should be stressed that these issues were
not directly addressed in Superstrike but we would suggest that this could be an
argument made for a tenant in any future case. In these circumstances, if a Court was persuaded by these arguments then a landlord who had either not re-protected the deposit, or with a protected deposit who had not served the Prescribed Information on the renewal of the tenancy or the creation of a statutory periodic tenancy, might be unable to serve a section 21 notice. They might also be subject to a financial penalty of between one and three times the deposit (plus the return of the deposit itself).
Even following the release of this joint information the Schemes would not advise clients on which way to proceed but merely the options available. The safest option was to re-issue the prescribed information for all tenancies that had become periodic at that time. Yes a court could decide that it was issued late and issue a financial penalty but the section 21 could be served if required For future tenancies it is recommended that you re-issue the prescribed information when the tenancy goes either periodic or a new fixed term is set up.