Renting Homes: The Final Report - Law Commission

MANAGEMENT CODES AND CONSULTATION 14
11.8 The Bill makes provision for a community landlord to negotiate a “management
code” with the contract-holders of its properties, dealing with how the landlord
intends to exercise its rights or comply with its obligations. Such a code will not
come into effect until and unless it is agreed by the contract-holders or their
representatives. Once a management code is agreed, it must be taken into
account by the court when considering a possession action or the withholding of
consent by the landlord. Thus a community landlord can require a court to have
regard to its management policies, but only if it is able to get its contract-holders
to sign up to them. This approach should provide a modest but significant boost
to contract-holder participation. 15
11.9 More generally, community landlords are required to make arrangements for
consulting contract-holders on questions of housing management 16 and to
publish a statement of those arrangements. 17 These arrangements, already in the
existing law, are carried over into the new scheme.
TENANCY DEPOSITS
11.10 One issue, with which we have not been directly concerned, but which has been
an important background issue during the time we have been engaged on our
project has been whether and if so how to regulate tenancy deposits. After much
debate, the Housing Act 2004 included provisions 18 that require landlords who
take deposits from assured shorthold tenants to secure those deposits in an
approved tenancy deposit scheme. It is clear that regulation of the tenancy
deposit scheme can be made easier through use of our recommended scheme.
11.11 Our Bill contains provisions dealing with tenancy deposits. The effect of them is
to extend the current statutory system for the protection of deposits to all
occupation contracts. 19 It is a fundamental term of all occupation contracts that if
a deposit 20 is to be paid in connection with an occupation contract, the deposit
must be dealt with in accordance with an authorised deposit scheme. 21 The
landlord must give the contract-holder and any interested third party sufficient
information 22 to enable them to ensure that the requirement has been complied
with. 23
14 This is discussed in Part 8 of Renting Homes (2003) Law Com No 284.
15 Cl 211, sch 4 para 6(8) and sch 7 para 8. The appropriate authority has the power to
regulate the procedures for obtaining the agreement of contract-holders or their
representatives to the management code: cls 211(3) to (5).
16 Cl 212.
17 Cl 213.
18 Ss 212 to 215 and sch 10 to the Act.
19 Part 2, ch 1, cls 36 to 42.
20 Defined to mean money paid as security: cl 37(4).
21 Deposit schemes are defined in cl 38.
22 To be defined in regulations: cl 39.
23 Cl 37.
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