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Protecting deposits in residential lettings

February 24th, 2014

As a residential landlord, you are hopefully aware that the law may require you to register your tenant’s deposit in a governmental scheme.

If your tenancy is one which requires the deposit to be registered, then you must do so within 14 days of receiving the deposit from them. There are also rules relating to informing your tenants of the registration of the deposit and if you fail to adhere to these rules, you may find yourself having to pay your tenant compensation.

We have recently acted for a landlord who instructed a letting agent to deal with his tenant’s deposit for him. He believed, quite justifiably, that the letting agent would register the deposit upon receipt in accordance with the relevant laws. It transpired that the letting agent made an error and did not register the deposit within the requisite 14 day period. The tenant has now issued a claim against the landlord for compensation for this failure.

Even though the letting agent was supposed to be dealing with the deposit on the landlord’s behalf, the landlord will be held primarily liable for the error.

If you are a residential landlord and will be receiving a deposit from your tenants, make sure you seek legal advice as to the rules that you must follow upon receipt of the deposit to avoid the possibility of a claim being made against you for compensation. Even if your letting agent is undertaking this role for you, we would still recommend that you find out what steps they should be taking, and then obtain evidence from the letting agent that they have complied with the relevant rules.

If you require any advice in relation to residential lettings, please contact Andrew King or Stefania Fulford for advice at


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