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Superstrike/ Rodrigues


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Well, I am totally lost on this , are they saying we have to put deposits pre 2007 into a scheme or not ?. Today I have received an Email from my deposits that seems to say if you protect the deposit its ok for the first 6 months .then you have to re protect it , I am seriously thinking at 67 its time to sell the whole portfolio.

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I've got a 13 page copy of that judgement on my desk - what a load of s***.

Personally I think it is only a matter of time before there is another ruling setting out different guidelines form another judge so I am not getting too upset/excited.

Think of how many landlords/lets there are in England and Wales and will they all re-protect - there will be chaos?

I don't have any tenants deposits before 2007 now but once a year I send a standard letter saying where the deposit is with ID number and on entry I give out the 'prescribed information' and make tenants sign a receipt for it.

I think that shows 'reasonable care' and that at the end of the day is what the law wants us to do.

I don't use My Deposits - but I bet they are making £££s out of this new idea somewhere along the line.

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Yes it does make you wonder if being a professional minded landlord is worth it these days.

I did scale back my rental properties and slowly sold a few off over a period of ten years to minimise tax payable on the sales.

If it does get any worse then I may be minded to get out of it altogether as it is becoming too much of a red tape nightmare.

Funnily enough I have just had a phone call from a BTL landlord asking to buy my flat and I am seriously tempted but where do you put the proceeds these days with interest rates far below 2% ?

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I do have a deposit pre 2007 but I am going to return it as I just cannot be arsed with this new set-up.

My Tenant is one of the best I have ever had so it is extremely unlikely he will stuff me where the Sun doesn't shine and even if he did there is nothing I can do about it.

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I have a few long term tenancies.....

1. Tenancy started in 2000 on a 6 month AST........no deposit (already returned in full some years ago).

2. Tenancy started in 2003 on a 6 month AST........50% of deposit returned some years ago, AST never renewed, tenancy has been periodic for almost 10 years.

Actions I intend to take......NONE.

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  • 2 months later...

I have a few long term tenancies.....

2. Tenancy started in 2003 on a 6 month AST........50% of deposit returned some years ago, AST never renewed, tenancy has been periodic for almost 10 years.

Actions I intend to take......NONE.

That could turn out to be a costly mistake.

Below is an extract from a ambulance chasing deposit protected incorrectly company who act for the tenant. It appears a deposit of £820 wasn't re-protected and new PI served for 5 months of a periodic tenancy.

"The liability is an award of between one and three times the deposit for each breach. The original deposit will also have to be repaid. If this were to go to court we will strive for the maximum possible award and the return of the deposit in full, i.e. the return of £820 plus up to £12,300 (representing the deposit x3 [£2460] for each tenancy period).

We are, of course, willing to proceed to court on this matter. This means you will be liable for the court fees (about £1300) and costs associated with employing representation as well as the settlement figure awarded."

Now we know a judge may or may not award the full amount but do you all want to take the risk. That's a week or two fuel for the Sunseeker.

PS: The guidance given and that's all it is just guidance following the Superstrike court case by the deposit schemes and ARLA etc is being modified all the time. So it a good idea to keep re-visiting the sites for any changes.

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By coincidence I was having a read of this case yesterday and can you make top to tail of the whole sorry report? It does seem to change from week to week.

I only have one unsecured deposit from pre 2007 and it's only a small deposit anyway but having read this report and the very good chance of having the bat shoved where the sun don't shine I am inclined to protect it for free with the DPS or possibly just hand it back to the tenant.

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I have nine current tenancies, eight with deposits held, one held by me (pe 2007) .

There are more terminated tenancies (some hostile).

Looking at the threat by the "ambulance chasing" gits it follows that they could attempt to claim the 3x for not only current tenancies but for the terminated tenancies that hadn't had their deposits protected or re protected, and for each tenancy period. Here I feel some confusion as each month is a tenancy period for my 'periodic' tenancies.

We can see the obvious excitement of such tenants but should such a claim or claims enjoy success it would finish most of us, certainly me. Imagine the short term effect on the industry.

Next would be claims of illegal eviction as if these deposits are 'now' deemed to not have been correctly protected I / we had no right to repossess using the S21.

There is no point in doing anything as it's already to late.

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I wouldn't say there is no point doing anything as protecting now and/or giving PI will mitigate any potential claim and would look better than reacting to the start of any court action.

We have a number of old tenancies and periodic ones on our books so we are trying to get them all on new AST's with new PI. Our AST's now have a provision that if it becomes periodic the PI will not need to be re-served and deposit re-protected.

Any tenancies that for what ever reason have to stay periodic we are just sending out new PI with an accompanying letter but not giving the reason why.

There is still a risk of a claim but hopefully reduced.

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According to Lord Denning - remember him - the interpretation of the law is about 'reasonableness'.

It is generally accepted now that if a landlord holds a deposit from a pre 2007 tenancy he/she should protect it or return it to the tenant.

Just like mis-sold loan insurance by the banks this has attracted the 'unreasonable' members of the legal proffession. As far as I am aware no cases have been brought by any of these companies yet.

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  • 4 weeks later...

Went on a course last week relating to the Superstrike case and some of the main things raised and clarified were:

Note it is the periodic tenancies and old pre 2007 tenancies element that is going to sneak up on landlords.

1 At the court of appeal it was unanimous with all three judges so very unlikely to be appealed.

2 There is a point of no return for the penalty. It you haven't protected or re-protected the deposit weather new tenancy, periodic or old pre April 2007 within the 30 day limit. You are liable for a penalty if the tenant or ex-tenant chooses to take you to court. As there is no defence.

3 There is a point of no return for the penalty. It you haven't given the prescribed information at the start of a tenancy, when the tenancy became periodic or for old pre April 2007 that is now periodic within the 30 days limit..You are liable for the penalty if the tenant or ex-tenant chooses to take you to court. As there is no defence.

4 Reasonableness doesn't really come into it, the court has to award a penalty up to 3 times the value of the deposit plus the return of the deposit if in breach as there is no defence. The only reasonableness element taken into consideration would be the amount of penalty awarded.

5 A section 21 can only be served if the deposit is protected and PI given.

6 The first thing Shelter and CAB are asking when they get a tenant asking for advice regarding s21 or s8 is the status of the deposit and PI to check it has been dealt with correctly by the landlord.

7 Use a section 8 with care as counterclaim for the penalty will be used to bring the arrears below the 2 months and likely get the possession claim refused.

8 We were shown a number a genuine letters from a number different companies who had written to a landlords threatening court action due to the above. The landlords were all advised to pay up as there was no defence and to avoid legal fees for both sides. These companies are charging 25% of what they win/collect. I wont name these companies for obvious reasons. One of these companies actually started up after going on one of these courses.

9 The options available to you if find yourself in this vulnerable position (before a (ex)-tenant claims) are:

a Do nothing. Not advisable which I will explain why below.

b Serve PI on the tenant now and re-protect the deposit. The down side to this is it could highlight a issue and the tenant will question why which could start a claim.

c Give the tenant a new contract and PI with the deposit protected correctly and a correctly worded clause to cover you when or if the tenancy becomes periodic in the future. This means you don't have to worry about further protection unless you want a new ast at a later date. This is the best of the three options as it muddys the waters and if a tenant goes to shelter or CAB they are likely to only show/have the latest (valid) contract. If you renew the AST a number of times even better, This option just reduces the risk not remove it.

10 The reason for doing nothing not being advisable is the penalty is "the court may order up to 3 times the value of the deposit" So if now or 3 or 4 years later your tenant takes you court and you did nothing the court is very likely to award the full penalty as you had 4 years to correct the mistake. But if you sort it asap it shows due diligence and acting promptly on law change and you should get a lot smaller penalty which may only be a few hundred quid not 1000's which makes it lot less attractive to these claim companies to take it on.

11 The momentum is building up for these claims as it is becoming more common knowledge in the industry and in the world of the tenant grapevine.

I admit there is a lot of ifs and buts regarding the above but it up to the individual and their view to risk how they chose to act.

If any of you would like one of the contracts with the get out clause mentioned in 9c above join the Guild of residential Landlords for £80 or £9 pcm https://www.landlordsguild.com/ We have been using the contacts for the last 3 months.

The joys of being a landlord.

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Thanks again Grampa. You have helped me look at this industry with an increased view of pessimism.

Like many I have several properties that are now negative equity. I see the light at the end of the tunnel getting closer but also believe recovery to be slow and not sustainable enough to become attractive equity wise.

For some time I have been experiencing longer voids. I promote at very competitive rents but admit I don't create and re-create palaces, They are however very secure, efficient and habitable. I now am paying council tax in these cases and on one now at 150%.

Depending on the area water rates can be payable, of course electric is payable as used.

One, still mt, property is under 'selective licencing' so that after finding a HB T (most likely), then hoping for rents to come in, I have 30 days to register the property and pay £750. This will have associated costs of inspections and any works deemed necessary by an inspector. No profit there then, and the mortgage is £58k on a property of less than £30k value. Wait for interest rates to rise and it'll be costing me to house a T who is likely to abuse where possible.

You may remember Mr Ciderhead. I'm just back from the Caribbean and thinking it's time to progress his expired S21. The lead period for court would mean he's hoofed shortly after xmas. Then I am liable for the council tax for an unknown period. I know he will go to Shelter, they always do in Prestatyn. I am guilty of not re-protecting his deposit and having experienced the local court sympathies toward abusive T's and G'tors I would only expect him to enjoy a payout.

To 'attempt' to reduce exposure, to 'attempt' to look as though I tried in the eyes of a judge I should now apply much administration effort when I see my role as getting up a ladder and improving the properties, nah this additional admin is not for me.

If they are coming for me let 'em. I can only hope I can move fast enough to be in a better place when they get here. I didn't sign up for this lot.

A small point, even with my view that the deposit protection was so that those in the Smoke could enjoy those many millions (deposits) that we used to hold I don't see that in it's biased design that it was ever designed for this corruption to be the result.

Where is common sense ?

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Yes all very messy at present. Fortunately I have been doing this landlording malarky for a long time so I can roll with the punches every so often.

I do wonder why newbie landlord's want to get into this business. It is sooooo one sided in favour of the tenant.

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Yes and for the people who don't take the liability/risk seriously you only need to look on landlordzone to see the posts of landlords already getting caught out by these claim companies.

The momentum is building.

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  • 4 months later...

I know this is an old thread.

I just spoke with a local lettings agent who I'm friendly with and happened to mention the Superstrike case. Apparantly, they tell me they have no knowledge of it and so have taken no avoiding action. They have hundreds of managed properties on their books and I guess quite a large number of them would already be periodic and have missed the 30 day PI deadline.

I've now given them :

* The DPS Guidance notes and

* The joint industry statement on the court rulings.

I'll give them a couple of days to read & digest and go revisit.......it'll certaiinly be interesting to see what action plan, if any, they decide on.

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One on the reasons the industry needs to be regulated as I had a very similar conversation with a agent 10 miles up the road from me who I am maybe buying a property from. (they do both sales and lettings)

I didn't let on I was in the same business.

The silly thing is there is a very easy fix to the periodic situation and the re-serving of the PI.

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The silly thing is there is a very easy fix to the periodic situation and the re-serving of the PI

Is this ?.......

1. Get any old tenancies on new AST's with new PI.

2. Add clause to all new AST's saying that if it becomes periodic the PI will not need to be re-served and deposit re-protected.

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  • 2 months later...

The DCLG has published the text of the Government amendment to the Deregulation Bill that is proposed to deal with tenancy deposits and specifically the Superstrike position of a new tenancy (and requirement to re-protect the deposit and re-serve the prescribed information) arising when a fixed term ends and a statutory period tenancy begins.

The text of the amendment – a new S.215A to the Housing Act 2004 – is below.

Briefly, the effect appears to be to provide that a deposit shall not be deemed to be paid or received in respect of a statutory periodic tenancy arising. Once it is in force, there will be no need to re-protect the deposit or re-serve the prescribed information.

This will also apply to any previous move from fixed term to statutory periodic where the issue has not yet been decided in proceedings, at least by the date it is in force – “shall always be deemed to apply [...] whenever it was paid or received”. This is not quite full retrospectivity, but means after the provision is in force, the court shall treat any past fixed term to statutory periodic change accordingly.

The other significant element is that any deposit taken prior to the Housing Act 2004 provisions coming into force in April 2007 before the Housing Act 2004 provisions came into force, which is not yet protected, must be protected within 3 months of this provision coming into force. This is a useful sweeping up, meaning that after the 3 months, all deposits that have taken for an AST, whenever they were taken and no matter how long ago, must be protected and prescribed information served.

The amendment look like it should work at first sight. But, a few points:

This will only apply to fixed term to statutory periodic tenancies. It does not, categorically not, apply to ‘renewal’ tenancies for a fresh fixed term. The deposit will need to be re-protected and the prescribed information served within 30 days for those, even if the landlord/agent just keeps hold of the same deposit.

This does not apply until the bill is passed and the provision is in force. Until then, Superstrike remains valid in operation and not re-serving the prescribed information on a statutory periodic arising means that no section 21 can be served. While this will change once the provision is in force, any possession claim issued before that on an invalid s.21 should still fail.

There is a big question whether the provision would retrospectively validate a purported s.21 notice served (where the prescribed information was not reserved in time) before it came into force.

Those advising both landlords and tenants should look at all of this very carefully.

The clock is ticking on Superstrike defences to possession, and s.214 claims. But I suspect that, as with the Localism Act amends in 2012 and the requirement for all post April 2007 deposits to be protected within one month, there will be a lot of landlords and indeed agents who get caught out by the 3 month provision here. There may not be that many pre-2007 deposits around, but the numbers are not insignificant.

The text of the amendment:

(1) The Housing Act 2004 is amended as follows.

(2) In section 215, paragraph (5), at end insert—

“Shorthold tenancy deposit: further requirements


(1) A tenancy deposit shall not be treated as being paid or received in connection with a shorthold tenancy by reason only of the deemed grant of a statutory periodic tenancy pursuant to the provisions of section 5(1) of the Housing Act 1988 (“the 1988 Act”).

(2) Subsection (1) shall apply (and shall always be deemed to apply) in respect of any tenancy deposit whenever it was paid or receive whether before or after the coming into force of sections 212 to 215 of the Housing Act 2004 (“the 2004 Act”).

(3) Where—

(a) a tenancy deposit has been received in relation to a shorthold tenancy under a tenancy (“the original tenancy”);

the original tenancy was granted as a fixed term tenancy;

© the original tenancy commenced before 6 April 2007;

(d) immediately upon the expiry of the fixed term of the original tenancy a statutory periodic tenancy was deemed to be granted pursuant to section 5(1) of the 1988 Act;

(e) the initial requirements (as defined by section 213(4) of the 2004 Act) have not been complied with in respect of that tenancy deposit; and

(f) no event has occurred on or after 6 April 2007 which would otherwise require that tenancy deposit is to be protected in accordance with an authorised scheme under section 213 of the 2004 Act the provisions of subsection (4) shall apply to that tenancy deposit.

(4) The initial requirements under section 213(4) of the 2004 Act and the requirements of section 213(6) of that Act (relating to prescribed information) must be complied with in respect of any tenancy deposit referred to in subsection (3) within 3 months of the date when the provisions of this Act come into force.

(5) The expressions “tenancy deposit” and “shorthold tenancy” in this section shall have the same meanings as for the purposes of sections 212 to 215 of the 2004 Act.”.’.

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So it does look like my pre 2007 deposit taken does have to go through the DPS system and to be registered.

I have to say I am not really against that being necessary, being a lawful landlord, but it does still seem the minority are spoiling it for the majortiy yet again and the powers to be always seem relunctant to actually take positive action against Scumbag landlord's.

Perhaps their next actions will be to ensure tenants adhere to a few basic rules and a good start would be if you rent a property you pay rent and Shelter/CAB are not permitted to tell defaulting tenants to sit tight and not to pay their landlord and to wait for eviction.

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