Judge strikes out possession claim over original deposit?

Judge strikes out possession claim over original deposit?

8:56 AM, 13th January 2025, About 6 hours ago 8

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Hi Guys, I am wondering if you are able to help with this situation:

I signed a tenancy agreement back in January 2015 and collected 6 weeks deposit with the rent of £1,075 per month and collected deposit of £1,600. I increased the rent twice – once in April 2019 from £1,075 to £1,200 and then in January 2024 to £1,400. In June 2024 I served the tenant with a Section 21 notice.

No new tenancy was signed and the contract rolled into periodic tenancy after 12 months of original tenancy. As currently rent is £1,400 therefore 5 weeks deposit would in fact be more than £1,600 but I currently hold £1,600. Furthermore, the tenant did not pay rent in JUNE 2024 and since then I am collecting rent directly from DWP.

The Judge has offered 28 days grace period Pursuant to CPR r.55.16 (4) (b) – the Claimant may apply within 28 days of the service of the order for the claim to be restored.

My question is: Do I have to submit a N244 application on the basis that rent is currently £1,400 per month, therefore my section 21 was compliant? Or will the Judge only look at only original amount of £1,075 and I have to refund the tenant the difference?

Do I have to start the whole process again?

Can I mention that the tenant owes me £1,400 in rent and can that count towards offsetting the arrears or do arrears not count?

This is the only property I have and a friend who helped me previously is very unwell and I am not too familiar with process and once possession is granted then I would look to sell this property.

Any help will be greatly appreciated.

By the way there are 2 fee structures for N244 application – £303 and £119 which one would apply?

Many thanks and Happy New Year to all fellow landlords.

Jaz


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Niwdog

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10:53 AM, 13th January 2025, About 4 hours ago

If you need to ask here for basic advice..... your best plan is to employ an eviction specialist.
Their fees are modest, and proceeding correctly will probably save you thousands.
I recommend Legal For Landlords.

Neil Heffey

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10:54 AM, 13th January 2025, About 4 hours ago

Based on the information you’ve provided, it seems your Section 21 notice is invalid. Attempting to restore your claim could expose you to adverse costs. When you originally collected the deposit, it exceeded the legal limit—you should have taken no more than £1,240, which must be protected in a government-approved scheme like the DPS or TDS.

If the deposit was not protected, your tenant could potentially claim up to 3 times the deposit amount for non-compliance. Additionally, failing to provide the prescribed deposit information could result in a separate claim for up to 3 times the deposit amount. If a solicitor represents the tenant, you may also face liability for their legal costs.

To address this, I recommend:

Refunding the excess deposit amount immediately.
Protecting the remaining deposit in a recognised scheme.
Ensuring all prescribed information is served, including the gas safety certificate, EPC, deposit information, and How to Rent guide.
Issuing a new Section 21 notice after full compliance and starting the possession process afresh.
This approach will reduce the risk of legal complications and financial penalties.

Judith Wordsworth

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10:54 AM, 13th January 2025, About 4 hours ago

From 1st June 2019, landlords in England are subject to new rules regarding tenancy deposits and fees under the Tenant Fees Act.
Deposit Cap
For all new and renewed tenancies:
Deposits are capped at the equivalent of five weeks’ rent for properties with an annual rent under £50,000.
You say you hold the deposit. Do you personally hold the money or it is held in a Deposit Protection Scheme, which has been required since 2007.
As your tenancy started in 2015 the max equivalent of 5 weeks doesn’t apply. Write to the Judge politely pointing this out IF the deposit is held in a Deposit Protection Scheme, and request an explanation as to why your have been denied Possession Order. Copy this to the Minister of Justice and your MP.
If the deposit is not protected then you face the possibility of being fined the amount of the deposit plus up to 3 times the deposit held.

NewYorkie

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11:06 AM, 13th January 2025, About 3 hours ago

We rely on these judges for their experience and expertise, but they can make mistakes, and you didn't have an 'expert' to put your case.

Could it be the judge viewed the tenancy as 'renewed', when it became 'periodic'?

Jaz Jaz

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11:23 AM, 13th January 2025, About 3 hours ago

Reply to the comment left by Judith Wordsworth at 13/01/2025 - 10:54
Hello Judith, the Judge is clearly saying that "All New and Existing Tenancies from 1st of June were subject to 5 weeks rent. Therefore I had to refund him 1 week deposit based on evidence in front of him as he does not know that I increased rent since tenancy became periodic.

The issue I have is that last rent increase was done after last section 21 which now equates to 5 weeks deposit.

My question is that can I now submit another Section 21 but DO NO REFUND HIM 1 WEEK'S RENT AND SAY BASED ON CURRENT RENT I ONLY HAVE 5 WEEKS DEPOSIT.

It is Inurance based deposit which means I personally have deposiit but based on current rent that is 5 weeks.

Jaz Jaz

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11:26 AM, 13th January 2025, About 3 hours ago

Reply to the comment left by Neil Heffey at 13/01/2025 - 10:54
The deposit was always protected and it is currently protected but based on original tenancy it was 6 weeks rent but not on current rent. Judge does not know current rent biut he only has old tenancy. But he makes clear that All tenancies are affected from 1st of June 2020

Neil Heffey

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13:35 PM, 13th January 2025, About An hour ago

Reply to the comment left by Jaz Jaz at 13/01/2025 - 11:26
Given that the deposit was insured and remains protected, you should generally be in a good position regarding compliance with deposit protection rules. This situation is somewhat unusual and may leave room for legal arguments, but based on the information you’ve provided.

When the deposit of £1,600 was originally taken in 2015, there was no statutory cap, so there was nothing unlawful about the amount collected at that time.

Impact of the Tenant Fees Act 2019:

The Act applies to new tenancies or tenancies that became periodic after June 1, 2019.
As your tenancy transitioned to a statutory periodic tenancy before that date, the deposit cap introduced by the Act does not retroactively apply to your situation. Therefore, the amount of £1,600 remains lawful.

You could apply to restore the claim by submitting an N244 form. On the form, request that the application be heard without a hearing (this may save time and costs).
To support your application, you may need to prepare a legal argument explaining why the deposit amount complies with the law, emphasising that the tenancy became periodic before the Tenant Fees Act came into force.

While you can make the application yourself, given the complexities of this situation, you may benefit from instructing a solicitor to represent you. A legal professional could ensure your argument is presented effectively and help you navigate any challenges raised by the judge or opposing party.

Jaz Jaz

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14:35 PM, 13th January 2025, Less than a minute ago

Reply to the comment left by Neil Heffey at 13/01/2025 - 13:35
Thanks for your response but the Judge is saying that from 1st Of June 2020 new Law which came in play on 1st of June 2019 applied on old tenancies too. My position is that I submitted Section 13 for higher rent before Section 2 1but higher rent only applied after issuance of Section 21 so the fact I submitted Section 13 Notice before Section 21 should I not be able to restore claim?

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