The recent Court of Appeal decision in Lowe v The Governors of Sutton's Hospital In Charterhouse [2025] EWCA Civ 857 marks a shift towards a more practical and purposive approach to tenancy deposit compliance. In the decision, the court confirmed that minor administrative or technical errors in the prescribed information will not, in of themselves invalidate compliance provided the tenant is able to understand the information that is provided and is not materially disadvantaged by the error.
The facts behind the dispute
Historically, the courts have adopted a strict and literal interpretation of the Housing (Tenancy Deposits) (Prescribed Information) Order 2007 requiring landlords and agents to adhere rigidly to its wording. However, Lowe signals a departure from this rigid approach, recognising that the purpose of the legislation is to ensure tenants are properly informed of their rights, not to penalise landlords for minor mistakes. The focus, therefore, is on substance over form and on whether the tenant has suffered any prejudice as a result of the error.
In this case, Mr Lowe, a tenant since 2010, claimed over £120,000 in penalties after his landlord’s agent served prescribed information that contained two technical errors: it referred to a non-existent “clause 6” in the tenancy agreement and the deposit certificate was unsigned (though accompanied by a signed cover letter).
The claim was based on multiple tenancy renewals over several years, with Mr Lowe arguing that each renewal triggered a fresh breach due to the same errors being repeated. He contended that the inaccuracies rendered the prescribed information non-compliant under the Housing Act 2004 and sought three times the deposit amount for each breach. The landlord’s position was that the errors were minor and did not affect the tenant’s understanding of the deposit arrangements.
When reaching its decision, the Court adopted legal reasoning consistent with the principles established in Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749 and Pease v Carter [2020] EWCA Civ 175. Specifically, the court applied the 'reasonable recipient test', assessing the notice from the perspective of how a reasonable person in the recipient’s position would interpret it, rather than focusing solely on strict literal compliance.
Applying the reasonable recipient standard, it found that the tenant reasonably would have understood the intended reference to the correct clause in the tenancy agreement and that the signed cover letter was sufficient to meet the confirmation requirement. The Court noted that the errors did not cause confusion or affect the tenant’s understanding of the deposit arrangements, and as such there was no injustice by the landlord. The Court also considered the context in which the documents were served and concluded that the landlord had reasonably complied with the requirements.
In practical terms, what should landlords and agents take away from this?
Tenant's rights: Landlords and agents must protect the tenant's deposit and serve prescribed information within 30 days of receipt.
Clarity: While prescribed information may contain minor inaccuracies, compliance can still be satisfied if a reasonable recipient would understand the intended meaning and not be misled. Nonetheless, landlords should take all reasonable steps to avoid such errors, as even minor mistakes may increase the risk of a breach.
Evidence: Landlords should retain proof of delivery to protect their position. A signed covering letter from the landlord’s agent, when delivered alongside the prescribed information, can satisfy the requirement for a landlord-signed deposit certificate.
Limitation: The ruling confirms the limitation period for tenancy deposit claims is six years.
The judgment in Lowe reflects a more flexible approach to technical breaches. It confirms that minor errors, as long as they do not mislead a reasonable recipient, will not likely result in successful claims for breach of the tenancy deposit prescribed information legislation. This should help discourage opportunistic actions, particularly where landlords have acted in good faith and tenants have not been unfairly affected.
This isn’t a loophole, it’s a reminder to focus not just on ticking boxes, but on ensuring tenants genuinely understand their rights.
