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Government “urgently exploring” Superstrike fallout

Government “urgently exploring” Superstrike fallout

The Residential Landlords Association (RLA) has received confirmation from housing minister Mark Prisk that the Government is “urgently exploring whether new legislation is required” following the controversial Superstrike tenancy deposit court case.

In a letter to RLA chairman Alan Ward, Prisk acknowledges the confusion within the private rented sector.

The Superstrike ruling was that when a tenancy goes from fixed to statutory periodic, a new tenancy is created. It was this that raised the issue as to what landlords or their agents should do in terms of deposit protection and the serving of Prescribed Information.

The RLA had recently written to Prisk expressing its members’ concerns at the Court of Appeal ruling. In his reply, Prisk admits that the judgement goes against the “intention” of the original tenancy deposit legislation, and that the Government is, “…urgently exploring whether new legislation is required to clarify the situation”.

He then states, that whilst he is unable to comment on individual cases, “…as a precaution landlords could decide to re-issue the prescribed information to tenant(s) which should ensure they can rely on the section 21 procedure if they wish to end the tenancy.”

The RLA says the minister’s reply cuts through the hysteria that has been created by the judgement. You can read the letter in full below:

Dear Mr Ward

Thank you for your letter of 11 July about the recent Superstrike Ltd vs Rodrigues Court of Appeal decision.

I am aware that this ruling has implications in respect of the tenancy deposit protection (TDP) legislation and the operation of the tenancy deposit protection schemes.

There are concerns that the Court of Appeal decision means that where a deposit was taken for an assured shorthold tenancy before the introduction of TDP and continued as a statutory periodic tenancy after 6 April 2007, the landlord should have protected the deposit at the start of the statutory periodic tenancy. This was not the intention of the legislation and we are urgently exploring whether new legislation is required to clarify the situation.

I understand that concerns have also been raised that the decision could have implications for some tenancies where a deposit has been protected in an authorised scheme in relation to a tenancy begun after 6 April 2007 and the fixed term has expired, and the tenancy continues as a statutory periodic tenancy.

While the Court of Appeal did not make a decision on these particular facts and we cannot advise on individual cases, as a precaution, landlords could decide to re-issue the prescribed information to their tenant(s) which should ensure they can rely on the section 21 procedure if they wish to end the tenancy. Again, we are exploring whether new legislation is required to clarify the situation.

Best Wishes,
Mark Prisk MP