Iveta Purina made an application after her landlord, Elena Zaharchenko, cancelled a cheque for the full refund of her £325 deposit. In another application, Addington Formwork Ltd, which rented a property for members of its staff to live in while working at a site on Clyde Street, sought sanctions after it received no information on what had happened to the £2,000 deposit it paid.

Both applications were decided at Case Management Discussions held via teleconference. Mrs Purina’s application was decided by FtT legal member Richard Mill, and Addington Formwork’s by legal member George Clark.

Deposit paid in instalments

In Mrs Purina’s application, made in respect of a private residential tenancy that commenced on 17 May 2020, the deposit had been paid in three instalments from 24 May 2020 to 24 August 2020. Following the conclusion of the tenancy on 9 June 2021, the landlord issued a cheque to the applicant for the full amount of the deposit plus a partial rent refund, but later stopped payment on the cheque.

It was submitted by a representative for the landlord that the tenancy was exempt from the provisions of the Tenancy Deposit Schemes (Scotland) Regulations 2011 because the landlord was resident in the property. The applicant did not have a tenancy of the whole flat, with some areas reserved for the respondent to be able to sleep there overnight on occasion and to store belongings.

It was further submitted that it had been impossible to fully comply with the 2011 Regulations as the whole amount of the deposit had not been received within 30 working days of the beginning of the tenancy. The applicant disputed that the respondent was a resident landlord and argued that she had been denied a fair and efficient means for seeking return of her deposit by the landlord’s failure.

In the Tribunal’s decision, it noted: “The Tribunal was not persuaded that the Respondent’s use of the flat was sufficient to entitle her to assert that she was resident there. It could not be described as her only or principal home.”

Addressing the argument that the 2011 Regulations did not apply where a deposit was unable to be paid into an approved scheme timeously, it said: “The view of the Tribunal was that this could not have been the intention of the Scottish Parliament. It would be a stateable defence to a complaint that a deposit had been lodged late, but Parliament can never have intended that the obligation to lodge tenancy deposits did not apply at all if the deposit itself was paid late.”

Having satisfied itself that the 2011 Regulations had not been complied with, the Tribunal ordered the landlord to pay the applicant the sum of £500.

Attempted short assured tenancy

Addington Formwork’s application was based on a tenancy that commenced on 26 January 2020 between itself and City Centre Lets Ltd, which acted on behalf of a Mr Shoukat Khan. The tenancy agreement for the property at Naburn Gate purported to be a short assured tenancy under the Housing (Scotland) Act 1988, despite the fact that no such tenancy could be lawfully created after 1 December 2017.

Following the conclusion of the tenancy on 26 July 2021, the applicant made repeated requests to the City Centre Lets for the return of its tenancy deposit of £2000 and sought clarification regarding the tenancy deposit scheme with which it was lodged. No correspondence was received from either Mr Khan or City Centre Lets, leading to the making of an applicant to the FtT.

In its decision, the Tribunal accepted that the tenancy created was covered by the 2011 Regulations, saying: “The premises were not used for any business-related purposes. The Tribunal was satisfied that the fact that the applicant former tenant is a limited company does not prevent the property having been occupied as a residential property.”

Having accepted the unopposed evidence of the applicant that the tenancy was unprotected, it went on to say: “Mr Khan is operating in an undisclosed manner as if a commercial letting agent and yet neither he nor City Centre Lets appear to have any experience or knowledge of residential lettings given that an attempt was made to enter into short assured tenancy over 2 years after such tenancies were no longer valid. The Tribunal is also satisfied having regard to the entirety of the documentary and oral evidence that the respondents have failed to act diligently and professionally and failed to account to the applicant in a proper manner.”

Having failed to identify any mitigating factors in the circumstances of the case, the Tribunal ordered the respondents to pay the applicant three times the sum of the deposit, the maximum possible sanction under the 2011 Regulations, amounting to £6,000.