Here is a question to the blog clinic from Susan who is a tenant:
We live in an HMO and have an AST tenancy. Our landlady failed to protect our deposit in a tenancy deposit protection scheme.
We were advised that because of this she would forfeit her right to serve us with a section 21 notice and that we would be able to make a claim for non-protection of deposit.
We requested that she protect our deposit but she refused and instead she posted the deposit in cash through our door along with a section 21 notice and said she had the police present to witness that she had done this.
Does the fact that she has now apparently returned our deposit mean that we can no longer claim for the penalty for x3 amount of our deposit?
You can still claim a penalty. The fact that the landlord has returned the deposit means that you can no longer claim for the return of the deposit or for it to be protected – as you now have it back.
However the landlord will have no defence to a claim for the penalty payment. The regulations now provide that this will be a sum between one and three times the deposit sum (rather than just three times as before), the exact amount to be in the discretion of the Judge.
As the deposit has been returned to you, and you have suffered no loss, I suspect that any award is more likely to be 1x the deposit sum than 3x.
However as the deposit has been returned this means that the section 21 notice served by your landlord is valid (assuming it has been correctly drafted) and she will be entitled to her possession order if you fail to vacate and she has to go to court to get you out (** see some of the comments on this point however).