Depositing Common Sense: Lowe v The Governor’s of Sutton’s Hospital in Charterhouse

[2024] EWHC 646 (Ch)
02 Apr 2024

Property, Public Law and Judicial Review


The High Court (Adam Johnson J) dismissed an appeal against the decision of HHJ Luba KC to dismiss of one of the largest known claims under the tenancy deposit legislation. This decision establishes as matter of precedent that the limitation period for such claims is 6 years, and provides useful guidance on how the requirements upon landlords, and their attempts to comply with them, should be construed.

The claim turned primarily on whether a certificate containing prescribed information which (1) contained an obvious error, and (2) was unsigned, was nonetheless sufficient to satisfy the statutory requirements under Housing Act 2004 (“HA 2004”). The court concluded it was.


The respondent Governors (“D”) are the trustees of the Charterhouse, a registered charity responsible for a historic complex of buildings dated from the 14th Century at Charterhouse Square in London.

Mr Lowe (“C”) took a written contractual tenancy of Flat 2, Preacher’s Court, within the Charterhouse, for a fixed term of 12 months, commencing on 4 January 2010. He paid a deposit of £3,300. At the time, the tenancy could not be an assured tenancy due to the size of the rent (£2384 pcm). As at January 2010, Housing Act 1988 Schedule 1 paragraph 2 provided that a tenancy could not be assured if the rent exceeded £25,000 pa.

However, from 1 October 2010, the rent limit was raised to £100,000 pa by the Assured Tenancies (Amendment) (England) Order 2010 [SI 2010/908]. It was common ground at trial that the tenancy thereby automatically became an assured (shorthold) tenancy from that date.

Section 213 HA 2004 provides that, “Any tenancy deposit paid to a person in connection with a shorthold tenancy must, as from the time when it is received, be dealt with in accordance with an authorised scheme.” There is no indication in the wording of that provision that its effect would have retrospective effect on common law tenancies, that later became ASTs.

However, at paragraph 4.6 of its Explanatory Note to the 2010 Order, the DCLG suggested (with emphasis added), “The Housing Act 2004 made provision for a tenancy deposit scheme for the purposes of safeguarding tenancy deposits. Landlords of all assured shorthold tenancies entered into on or after 6 April 2007 had to protect their tenants’ deposits in a recognized scheme. We consider that those common law tenancies entered into on or after that date, and which will become assured shorthold tenancies when the rental threshold is increased, must protect their tenants’ deposits in a recognised scheme.”

Out of an abundance of caution, D’s agents took steps to protect the deposit in a recognised scheme. On 28 September 2010, they sent C a covering letter explaining that they had done so, and enclosing a form containing prescribed information about the deposit and its protection.

The fixed term of the tenancy expired on 3 January 2011, and a statutory periodic tenancy then arose by operation of law (section 5 Housing Act 1988). The parties thereafter agreed various further fixed terms, also interspersed by other periodic tenancies. At the original trial, it was agreed that there had been at least 7 discrete tenancies in total; C contended there had been an additional 3 by a further agreed fixed term leading to 2 further periodic terms.

In June 2021 (11 years after the material events, and after D had served a notice seeking possession upon him), C  issued the current claim, seeking a payment of £120,888 for asserted breach(es) of HA 2004.

By the claim, C:

  • asserted that the deposit required protection under section 213 HA 2004 upon the coming into force of the 2010 Order;
  • asserted D failed to provide the prescribed information or TDS leaflet as required by the Housing (Tenancy Deposits) Order 2007 [SI 2007/797] (“the 2007 Order”);
  • alternatively, that the prescribed information provided was unsigned, and so failed to comply with article 2(10(g)(vii) of the 2007 Order;
  • asserted (as a matter of fact) a total of 10 tenancies including the original, including a fixed term tenancy said to arise on 1 October 2015;
  • claimed £120,888 under section 214(4) HA 2004, being the Deposit (and an additional payment also said to be a deposit) multiplied by 3, for each of the ten asserted tenancies.

By its Defence, D asserted that:

  • section 213 HA 2004 did not apply in relation to the deposit received in relation to the original 2010 tenancy;
  • in any event, the deposit was protected on 7 September 2010, and the requisite prescribed information and leaflet provided under cover of letter of 28 September 2010 (“the Letter”), and that protection ‘carried through’ by virtue of section 215B HA 2004;
  • it was denied that any fixed term tenancy was agreed or arose on 1 October 2015, consequently there were only 7 tenancies following the original 2010 tenancy;
  • D relied upon section 9 Limitation Act 1980 (“LA 1980”) to limit C’s claim to the any cause of action accruing after 10 June 2015 (i.e. a limitation period of 6 years);
  • without prejudice to the above, any award under HA 2004 should be minimal to reflect a technical breach, low in culpability, that did not cause prejudice to C.

On the eve of trial, C abandoned the assertion that a claim lay for the original (2010) tenancy. However, he continued to deny receipt of the Letter. Importantly, D accepted that the prescribed information certificate that had been enclosed with that Letter was not signed by its agent.

At trial, C sought to raise additional issues: (1) he asserted that article 2(1)(g)(vi) of the 2007 Order has also not been satisfied, as the information in the certificate contained an error (it referred to clause 6 of a tenancy agreement, that was not attached, and there was no clause 6 in the existing written agreement); and (2) he sought the return of the deposit, though such a claim had not been pleaded. C also argued that section 215B could not be relied upon where the original deposit had not been received “in connection with” an assured shorthold tenancy.

After trial over 2 days, by a detailed written judgment, HHJ Luba KC dismissed C’s claim. He determined that:

  • the majority of C’s claim was time-barred under section 9 LA 1980 – this applied as the claim was one to recover money under HA 2004;
  • the ‘additional payment’ was a not a deposit within the meaning of HA 2004;
  • the Letter had been signed, and was sent and received by C, with its enclosures (including the TDS Booklet);
  • the service of the prescribed information certificate under a signed Letter was ‘substantially to the same effect’ or satisfied the statutory purpose of article 2(1)(g)(vii);
  • though the certificate contained an error by reference to ‘clause 6’, it satisfied the statutory requirements (or was substantially to the same effect) as the reasonable recipient of the information would have seen the provision dealing with the deposit in his tenancy agreement;
  • the term ‘original tenancy’ section 215B HA 2004 was able to apply either to the first contractual tenancy or the first periodic tenancy thereafter – on either basis, its protection was afforded to D (to find otherwise would run contrary to the very mischief the provision had been designed to address);
  • there was no further agreed fixed term, as alleged by C, and so only 7 tenancies between the parties;
  • there was no pleaded claim to the return of the deposit, and the wording of section 214(3) HA 2004 did not compel it;
  • had he found against D, the Judge indicated he would have ordered no more than the minimum (1 x deposit) penalty as the deposit was protected, C knew it was protected and D’s agents sought genuinely to comply with the statutory requirements.

There was no appeal against the factual findings made by the Judge. However, by permission granted by Stewart J, C appealed on the following broad points of law:

  • as to article 2(1)(g)(vi) – this was a requirement of substance and so could not be satisfied ‘in a form substantially to the same effect’ – the error could not be remedied by recourse to the tenancy agreement;
  • as to article 2(1)(g)(vii) – the requirement of a signature could not be remedied in the absence of a signature;
  • as to section 215B, the strict wording of the provision did not apply as the ‘original’ tenancy for which the deposit had been received was not an AST;
  • C repeated his earlier submission that section 9 LA 1980 did not apply as his claim did not seek to ‘recover’ money in the sense of getting back something he had paid, as such he claimed a 12 year limitation period applied under section 8 (a statute being accepted to be a specialty);
  • the Judge ought to have required the return of the deposit under section 214(3) despite the absence of any pleaded claim.

The Decision

Fittingly, on the day of HHJ Luba KC’s valediction in the LCJ’s court, Adam Johnson J dismissed the appeal.

The Judge had been right to conclude that though the certificate contained an obvious error, it caused no real prejudice, on the established line of authority from Mannai Investments v Eagle Star [1997] AC 749, as summarised in Pease v Carter [2020] 1 WLR 1459. A reasonable recipient of the certificate in these circumstances would have appreciated there was an error (as there was no clause 6), and seen that clause 5.3 set out the circumstances in which part of the deposit might be retained by the landlord. The court agreed with C that the savings words of section 213(6)(a) (in ‘a form substantially to the same effect’) did not apply, as the requirement of article 2(10(g)(vi) was not one of form. However, the Judge’s conclusion on the correct interpretation of the information provided remained correct. The statutory purpose of promoting transparency with a view to avoiding disputes had been satisfied.

The requirement of a signature in article 2(1)(g)(vii) was a requirement of form. The provision of that information in an unsigned certificate, but under cover of a signed covering letter from the landlord’s agent was a in a form ‘substantially to the same effect’ within section 213(6)(a). The purpose of the certificate was to confirm that the landlord considered the information provided to be correct. That purpose was satisfied by its provision under a signed covering letter. The same approach had been taken in Stiddolph v American School in London Educational Trust [1969] 20 P&CR 801 in the context of an unsigned notice served under LTA 1954.

Section 215B HA 2004 had clearly been enacted to address the practical issues arising from the analysis of the Court of Appeal in Superstrike v Rodrigues [2013] EWCA Civ 669. Parliament clearly considered that if information was supplied at the outset of the parties’ relationship, it need not be supplied again. The Judge had been right to dismiss what he termed the “singularly unattractive” submission that the words of section 215B did not achieve that purpose. The words “in connection with” (an AST) were sufficiently flexible that they might apply to a contractual tenancy that had become an assured one. To assert otherwise ignored the ambulatory nature of assured status under Housing Act 1988.

This was clearly a claim caught by section 9 LA 1980. The word ‘recover’ or ‘recoverable’ is used throughout Part I LA 1980 with the meaning to ‘obtain’ monies not previously paid (e.g. interest, damages or contribution). C sought to obtain monies via an entitlement that only arise under the provisions of HA 2004. The Judge was right to conclude this was a claim caught by section 9 LA 1980, and so had a limitation period of 6 years. To the extent necessary, that analysis was supported by Re: Farmizer [1997] BCC 655 and Rowan Companies v Lambert Eggink [1999] CLC 1461 in which David Steel J considered that as between sections 8 and 9 LA 1980, “The relevant distinction would seem to be between claims under an enactment for non-monetary relief and those claims under an enactment for monetary relief whether in the form of debt, damages, compensation or otherwise”.

The Judge was right to reject a claim to the return of the deposit, and was not obliged to make such an order on the wording of section 214(3) HA 2004, never mind that no such claim had been pleaded.


This decision provides welcome clarity on the relevant limitation period for tenancy deposit claims, and as to the effect of section 215B HA 2004 to claims where the original tenancy may not originally have been assured.

Of greater note, however, will inevitably be the application of established common law principles relating to the interpretation of statutory notices to the requirements of various articles of the 2007 Order:

  • A certificate of information containing an obvious error should be construed as any statutory notice. If the reasonable recipient of that notice would understand the correct information to have been given, that would satisfy the requirements of the legislation.
  • The lack of signature upon the certificate of prescribed information was not fatal to its validity. Here the certificate had been provided under a covering letter signed by the agent of the landlord. The information was thereby given in a form ‘substantially to the same effect’ as that required in the 2007 Order.

This may provide welcome respite to landlords confronted by technical, but unattractive, claims brought under the tenancy deposit legislation.

The judgment will be of interest to all residential landlord and tenant practitioners, and can be found here.

Shomik Datta represented the successful Respondent (as he did at first instance), instructed by Tony Pidgeon of Stone King LLP.